Problem
• Explain the impact of inflation on purchasing power.
• Identify the costs that may decrease and those that may increase from pre-retirement to retirement.
• Distinguish between the top-down and bottom-up approaches in determining the wage replacement ratio.
• Identify the various sources of retirement income.
• Calculate the capital needs analysis using the annuity approach, the capital preservation approach, the purchasing power preservation approach, and the capitalization of earnings approach.