Financial Bank Inc. offers its employees a pension program with the following design:
The base retirement age is 65.
Employees can retire up to 5 years early with a 2% reduction in benefit for each year.
Employees can work an additional five years for a 1.5% increase in benefit (not subject to the maximum) for each additional year worked.
The benefits are based off of the average of the three highest salaries earned during their careers.
Employees receive 3% of their salary per year worked up to a 66% maximum.
Find the benefit earned by the following employees:
a.Adam, aged 65, worked for the company for 22 years. Average of his last three-years of salary: $63,000.
b.Bridget, age 62, worked for the company for 19 years. Average of his last three-years of salary:$72,000.
c.Camille, aged 68, worked for the company for 31 years. Average of his last three-years of salary:$45,000
Realty Development contributes to its employees 401(k) based on the following design: it matches its employee’s
contributions dollar-for-dollar up to 6% of their salary. Find the total contributions made to the retirement account for
the following employees during a one-year period:
a.Delwyn earned $62,000 per year and contributes 0% of his salary to his retirement account.
b.Eugene earned $49,200 per year and contributes 5% of his salary to his retirement account.
c.Felicity earned $71,500 per year and contributes 8% of her salary to her retirement account.