How much does mr heffernan need to save on a monthly basis

Assignment Help Financial Accounting

Reference no: EM132641054

Mr. Donald Heffernan, a 35 years old account manager At Wells Fargo has gross annual income after all deductibles of $85,000. Mrs. Heffernan quit her job at Walmart to take care of their twin kids, Luke and Christine. So Mr. Heffernan is the only income earner at his house hold.

Mr. Heffernan is filing income using the following "Married filing jointly" tax rate schedule.

Taxable income over Not Over Tax rate

$0 18,450 10%

18,451 74,900 15%

74,901 151,200 25%

151,201 230,450 28%

230,451 411,500 33%

411,501 464,850 35%

464,581 ....... 39.6%

Problem 1: Mr. Heffernan wants to give his twin son and daughter $100,000 each when they turn 18. Currently they are 3 years old. How much does Mr. Heffernan need to save on a monthly basis? Assuming that he could invest his savings at a portfolio that earns 4% per year.

Reference no: EM132641054

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