Case Study Statement:

Financial Independence, Retire Early (F.I.R.E) is a movement that encouragespeople to save a significant portion of their earning (e.g., 70%) to allow earlyretirement (e.g.in the age of 40). Please evaluate whether this extremeretirement plan can work for you and what percentage of your salary will needto be saved to achieve retirement at your desired retirement age?

Hints:

-You will need to develop the cash flow to account for your earning, expenses,and saving before and after yourretirement.

-Estimate your annual salary based on your major and years ofexperience ($120,000 & 22years of experience)

-Evaluate your annual living expenses and identify the maximum portion ofyour earning that you can save forinvestment (Annual living expenses = $40,000 & 20% of salary should be saved)

-Identify an appropriate personalMARR (MARR of 10%)

-Estimate your annual living expenses of your retired life (what would beyour post-retirementlife style, increased travel costs etc.) (Amount has risen to $60,000)

-Account forinflation

All values for the question were assumed/made up.

Need help developing a cash flow for the problem above on Excel for these values.

Thank you!