Eluzer earns $⁢75,000 per year. He wants to retire at age 67 with 70% of his preretirement income. Eluzer uses the 4% rule. How much should he have saved by retirement?

First find 70% of Eluzer’s $75,000 preretirement income: $75,000 × 0.70 = $52,500 per year. Under the 4% rule, that annual income is 4% of his savings, so $52,500 ÷ 0.04 = $1,312,500. The correct choice is $1,312,500.

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