Assumptions:Starting annual salary = $48,000, present value at career start = $250, years planning to work = 42, salary annual increase = 3%,projected investment APR = 7.75%, average inflation rate = 2%, you and your employer each contribute 2% for the first four years,then at years 5, 10, 15, and 20, both you and your employer each boost by one percentage point (i.e., both Employee Contributions andEmployer Contributions = 2% for years 1 to 4, 3% for years 5 to 9, 4% for years 10 to 14, 5% for years 15 to 19, and 6% thereafter).

1.Â	Keep all the assumptions the same from your 401(k) instruction sheet (found at the beginning of the Ponder/Prove practice questions) with the exception of projected investment set to 5.75% and starting annual salary set to $55,000. At about what career year does the interest balance from your retirement fund surpass principal balance?
Â	Career year #32. Career year #30. Career year #27. Career year #34.

2.Â	Keep all the assumptions the same from your 401(k) instruction sheet (found at the beginning of the Ponder/Prove practice questions) with the exception of projected investment set to 9.75% and starting annual salary set to $72,000. What is your final investment balance by the end of your career year 42?
Â	$4,522,286 $4,993,167 $4,216,951 $4,824,924 $5,347,889

3.Â

Keep all the assumptions the same from your 401(k) instruction sheet (found at the beginning of the Ponder/Prove practice questions) with the exception of projected investment set to 9.25% and starting annual salary set to $68,000. After 42 years of working and investing, what percentage of this final investment balance is contribution of principal (meaning yours and the employers payments) and what percentage is interest?

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15.8% is principal and 84.2% is interest 18.5% is principal and 81.5% is interest 11.1% is principal and 88.9% is interest 20.8% is principal and 79.2% is interest 28.5% is principal and 71.5% is interest