Target contribution rate for a defined contribution plan

Calculates the contribution rate required to achieve a target replacement ratio.

Usage

contribution_rate_target(x, z, Sx, RR_target, i, adue_z, g = NULL, s = NULL)

Arguments

x

Scalar entry age.

z

Scalar retirement age.

Sx

Positive scalar salary at age x.

RR_target

Scalar target replacement ratio in [0, 1].

i

Scalar annual effective investment return greater than -1.

adue_z

Positive scalar whole-life annuity-due factor at retirement.

g

Optional scalar annual salary growth rate greater than -1.

s

Optional positive salary-scale vector of length z - x.

Value

A numeric scalar. The result may exceed one when the target cannot be achieved with a contribution rate no greater than 100 percent.

Examples

contribution_rate_target(
  x = 30,
  z = 65,
  Sx = 60000,
  RR_target = 0.50,
  i = 0.06,
  adue_z = 11,
  g = 0.04
)
#> [1] 0.1052808