In South Africa, we don't have social security; those who save rely mainly on tax-advantaged employer and individual retirement funds. I list those on my personal balance sheet, even though these can (and sometimes must) be converted into a type of annuity at retirement. US Social Security is effectively an annuity with a defined benefit. These future cash flows have a present value. Yet somehow Americans don't seem to put a capital value on this benefit, and record it as an asset. Surely, doing so would lower their balance sheet volatility and stock market angst?
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In South Africa, we don't have social security; those who save rely mainly on tax-advantaged employer and individual retirement funds. I list those on my personal balance sheet, even though these can (and sometimes must) be converted into a type of annuity at retirement. US Social Security is effectively an annuity with a defined benefit. These future cash flows have a present value. Yet somehow Americans don't seem to put a capital value on this benefit, and record it as an asset. Surely, doing so would lower their balance sheet volatility and stock market angst?
Post: Sticking With Stocks
Link to comment from October 12, 2024