Question

how longevity risk is a factor in retirement planning and how do it relate to work...

how longevity risk is a factor in retirement planning and how do it relate to work and retirement?

Homework Answers

Answer #1

Longevity risk is a factor in retirement planning because people are often living higher than what they earlier expected during the retirement planning so it will be living to a longer period with risk as they will not be having sufficient funds in order to deal with their additional life so it will be creating a risk on their overall income ability so retirement planning should be done after proper consideration of the longevity risk as longevity risk will be providing them with risk associated with higher life than the expected life

It will be related to work and requirement also because longevity risk is never properly estimated because the life of the individual cannot be estimated completely in advance and it will have to be approximated by the individual and hence he should be trying to discount them as well as plan his life accordingly in advance.

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