RT Journal Article
SR Electronic
T1 Estimating the Value of Social Security Retirement Benefits
JF The Journal of Wealth Management
FD Institutional Investor Journals
SP 14
OP 29
DO 10.3905/jwm.2001.320415
VO 4
IS 3
A1 William W. Jennings
A1 William R Reichenstein
YR 2001
UL https://pm-research.com/content/4/3/14.abstract
AB The authors start with a simple question: what is the value of an individual's assets that can be used to satisfy retirement income needs, focusing more specifically on Social Security benefits? Consistent with an approach introduced in earlier works published in The Journal of Wealth Management, they then ask how these benefits affect the individual's current asset mix. In particular, they delve further into earlier conclusions that the present value of projected Social Security payments be included as a 'bond' in personal portfolios. They note that individuals' portfolios are usually substantially different when the value of Social Security is included than when it is excluded, and demonstrate that the profession has been miscalculating individuals' “true” portfolios by excluding Social Security. If individuals optimize their traditional portfolios, which exclude Social Security, then they have excessively conservative, sub-optimal true -portfolios.