Monday, October 26, 2009

Annualized income based on theoretical lifetime annuity?

Imagine taking all your debts and income for your entire life; both big and small, (school loans, car payments, $50 you gave your brother, 30 year house mortgage, etc.; income being your paychecks, the $5 you won in the lottery, possible inheritance, etc.) and taking the present value of all of them, at the time they occured, to the time you were born.



Now turn that sum into a theoretical annuity with annual payments (hopefully it%26#039;ll be positive!) for the length of your life; be it 75 years or 32. This could be an equivalent income for your entire life.



What would most Americans have as their income in terms of this annuity?



Both qualitative and quantitative answers are welcome.



Annualized income based on theoretical lifetime annuity?

To quote the ever so quotable Gieco caveman: %26quot;Yes, I have a response.....WHAT??!!%26quot;

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