This assignment will allow students to demonstrate their knowledge and application of personal finance planning. Personal finance planning includes finance management, risk management, investment, and retirement planning. In the assignment, we continue working with Eric and Kim and help them plan their retirement. Eric just turned 55, whereas Kim turned 54. Both have been active and do daily exercise. Eric and Kim are both non-smokers and rarely drink. Kim's parents are healthy, and they are in their 80s. There are not lots of mental stress for him now. Eric's father passed away 20 years ago due to a car accident, and his mother is in his 80s and healthy. Eric started his own consulting business and had many challenges ten years ago. The company is now stable, and he has employees managing the client accounts most of the time. He only shows up in important meetings. Kim has worked for the same organization and is not planning to change until her retirement. When Eric's father died, his mother received his father's life insurance payout. His mother, Sara, paid off the mortgage balance and has a significant amount left to cover her retirement. Sara wanted to keep the house in memory of her husband, but it was too much for her to take care of the property physically and mentally as her husband had just passed away. She hesitated between selling or keeping the property. Eric consulted with Kim and decided to purchase the property from his mother. They had Sara live with them and help them care for the kid, Danny. Also, Sara would share the housing and living expenses as well. It was the perfect solution for everyone. They were able to keep Eric's mother close and help her cope with the loss of her husband. Sara could help them with the kid and share living expenses. Now, Danny is 24 and about to get married. Sara is in her late 80s, and she needs additional care. After consulting with Eric and Kim, Sara moved to a retirement home in Florida to enjoy the warm weather. More importantly, she knows it will be too much for Eric and Kim to take care of her once she is in her no-go years. Now, Eric and Kim have no one else to worry but themselves about their retirements. A few days ago, Eric called and left a message, and they wanted to check their financial stability. Today, they came to the meeting and informed you that they would like to enjoy their earlier retirement to travel. Even though they know that their house is too much space for them, they want to keep them as Eric and Danny grew up in the house. There are so many good memories for Eric, and he is considering passing on the house to Danny as a heritage. Eric wants to know whether Kim and himself can afford to keep the house financially without compromising their retirement funds. Eric and Kim are considering early retirement at age 60 but are unsure about their financial situation after retirement. For the last 40 years, both have lived in Canada and made the maximum CPP contribution even after Eric started his own business. When Eric left his firm and started his own business, he had to give up his employer's pension plan. He received a lump sum payout of $50,000 after the income taxed payout. Eric invested payout in his TFSA accounts. Kim has been working for the same company for the last 25 years, and her company provides a defined benefit pension plan. If Kim continues working for the company until her retirement, she will be eligible to receive a fixed payment of $2,000 until her death. The pension income is fully taxable, fixed, and without inflation adjustment. Besides their CPP contribution, Eric and Kim have invested with your firm through registered and non-registered accounts. Last year, Eric and Kim just paid off their 30-year mortgage, which was the last loan they owed. They are debt free and have $150,000 savings in GIC, $250,000 in RRSP, and $250,000 in TFSA. They plan to leave the house as an estate to their son, Danny. There are only five years away for Eric and six years for Kim to their retirement, and they want to know whether they can retire at age 60. They want to maintain the same lifestyle and have a budget of $10,000 per year for travel and leisure during the first five years of retirement. To plan their retirement, they have been thinking about purchasing a Sunlife annuity, which needs a lump sum investment of $200,000 and receives $15,000 per year for the rest of their life. Please help Eric and Kim analyze their retirement plan and find how much they need to retire at 60. Also, Eric has expressed his early retirement to his management team and discussed the management buyout option, allowing his current management team to purchase his business for $250,000. The management team agrees to make five consecutive annual payments. Doing so will ease the company's cash flow and minimize Eric's income tax, as the $250,000 is fully taxable as a capital gain. Eric generates $100,000 in after-tax earnings, and Jane has been working independently as a financial accountant. Kim's after-tax income is $65,000 per year. Please see the attached Excel file for additional financial information and assumptions. Required: Calculate their life expectancy (5%) Prepare their current net worth statement (10%) Prepare their retirement incomes budget (20%) Prepare their retirement expenses budget (20%) Prepare their retirement cash budget (20%) Calculate the amount of retirement fund they need to retire (10%) Calculate the financial cap between their current net worth and retirement fund (5%)