Hello there:
I set up an Excel spreadsheet in order to determine the net present value of a vested state government pension that I am entitled to start receiving at age 60. I also figured out the net present value of my Social Security benefits, based on an estimate assuming that I will work until age 47 and begin collecting at age 62.
So, do most people plan on retiring early include the NPV of a pension and of a Social Security benefit in their overall net worth? Do inflation or taxes play any role in the present value of the pension or the social security benefit?
When determining the NPV of the pension and of the social security benefit, I used the 10 year treasury interest rate as the discount rate. I noticed that a slight interest rate change in the discount rate changes the net present value pretty dramatically. I used different 10 year treasury interest rates for the discount rate all within the month of August 2011.
Please let me know whether you include a vested future pension or a future Social Security benefit in your net worth calculation. If not, do you account for these assets in another way? Thank you for your advice.
I set up an Excel spreadsheet in order to determine the net present value of a vested state government pension that I am entitled to start receiving at age 60. I also figured out the net present value of my Social Security benefits, based on an estimate assuming that I will work until age 47 and begin collecting at age 62.
So, do most people plan on retiring early include the NPV of a pension and of a Social Security benefit in their overall net worth? Do inflation or taxes play any role in the present value of the pension or the social security benefit?
When determining the NPV of the pension and of the social security benefit, I used the 10 year treasury interest rate as the discount rate. I noticed that a slight interest rate change in the discount rate changes the net present value pretty dramatically. I used different 10 year treasury interest rates for the discount rate all within the month of August 2011.
Please let me know whether you include a vested future pension or a future Social Security benefit in your net worth calculation. If not, do you account for these assets in another way? Thank you for your advice.