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Reply to "How do you value a pension in your net worth?"
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[quote=Anonymous]It is a simple present value calculation. You can do this in seconds in exel: You can find out the number of years you are expected to live from an actuarial table. You need a discount rate - e.g. the 10 year treasury yield, 4.2 percent. Then you project the future pension payments for the number of years you are expected to live, increasing by inflation (e.g. 2.5 percent) each year if it is cola'd. Then you just calculate =npv(4.2%, the stream of payments). And that will give you a reasonable answer. [/quote]
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