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Harvey, a drill press operator for a machine shop, is 65 years of age and...

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Finance

Harvey, a drill press operator for a machine shop, is 65 years of age and will retire the first of next month. Harvey has $500,000 in his retirement plan. He estimates that he will live to age 90 and that he needs $2,000 per month to supplement his Social Security benefit and to maintain his lifestyle. Harvey would also like to have money left over to leave to his grandchildren when he dies. Harvey anticipates that he can earn 5% on his retirement assets. Which of the following is true?

Harvey will be able to pull out $2,000 per month but only for 20 years.
Harvey will be unable to meet his goal.
Harvey will be able to pull out $2,000 per month for 25 years and still have money left for his heirs.
Harvey will be able to reach his goal but there will be nothing left for his heirs.

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