Michelle has been a registered nurse since obtaining her RN at age 28

• She has been living in Brampton since her childhood, and feels that serving the community that her parents raised her in is her way of giving back.
• Though she is 40 years of age, she feels that nursing does wear her out (physically and mentally) working 12 hour shifts. Like her older sister, taking full retirement at age 65 and travelling the world as a volunteer nurse would be a dream come true.
• She currently earns $102,000 annually today, and thinks retiring on 70% of this income to age 95 would make retirement comfortable, assuming that inflation does not exceed 2%.
• The Human Resources Department at the hospital confirmed that she will receive the current maximum CPP benefits ($ 13,850) and OAS ($ 7,285). Additionally, her defined benefit pension at work will pay $ 24,000 annually. Knowing that these benefits (CPP/OAS/ pension) will be indexed to the inflation rate is comforting to her.
• With a current balance of $ 85,000 in RRSPs, and annual contribution of $4,000/year annually, she wants to be sure that retirement at 65 is realistic.
• She also mentioned that she expects to get a 6% rate of return to grow the RRSP until retirement and then converting to a RRIF at 65, earning 4% conservatively each year to age 95. She wondered if it is just a dream? She would like to know if there is a shortfall, what is that number?
• She has come to you for assistance. Using the 5 steps below, please help her!

Step 1: - Note: Question 15 to 21 are all related to this case study:

Michelle has indicated that she will needan annualincome of$___________in today's dollars

in her first Year of retirement. Assuming an annual inflation rate of________%, this translates

to$___________(1)in future dollars.

Step 2: - Note: Question 15 to 20 are all related to this case study:

Michelle expects to receive the following annual income during her retirement:

Canada Pension Plan (CPP) = $ __________

Old Age Security (OAS) = $___________

Guaranteed Income Supplement (GIS) $___________

Company Pension Benefit (RPP-DB) $___________

Other Income (if any) $___________

Total = $___________

Michelle's totalannualretirement pension income from the above sources (when expressed in

future dollars) is expected to be$___________. (2)This income will continue for the duration of

her retirement.

Step 3: - Note: Question 15 to 20 are all related to this case study:

To meet her financial needs through___________ yearsof retirement, and assuming she will

continue to earn a___________%return on her RRIF investments during retirement, Michelle

will need to have saved$____________(3)by the time she retires.

Step 4: - Note: Question 15 to 20 are all related to this case study:

Under Michelle's current savings plan, she will have a shortfall of$___________, as the

existing funds she has already accumulated (if any) plus her existing annual contribution (if any)

will grow and accumulate to $ ______________ (4)

Please answer all 4 steps mentioned above