Terrance, age 43, earns $80,000 annually; and his wage replacement ratio has been determined to be 80%. He expects inflation will average 3% for his entire life expectancy. He expects to work until 68 and live until 90. He anticipates an 8% return on his investments. Additionally, Social Security Administration has notified him that his annual retirement benefit, in todays dollars will be $26,000. Using the capital needs / annuity method, calculate how much capital Terrance will need to be able to retire at age 68.

$836,000.

$1,760,000.00.

$1,061,342.08.

$1,112,863.56.