The 800 years of scientific breakthroughs that will help salvage your retirement plans Physics, Chemistry, Astronomy, Biology; every field has its intellectual giants who made breakthrough discoveries that changed the course of history. What about the topic of retirement planning? Is it a science? Or is retirement income planning just a collection of rules-of-thumb, financThe 800 years of scientific breakthroughs that will help salvage your retirement plans Physics, Chemistry, Astronomy, Biology; every field has its intellectual giants who made breakthrough discoveries that changed the course of history. What about the topic of retirement planning? Is it a science? Or is retirement income planning just a collection of rules-of-thumb, financial products and sales pitches? In "The 7 Most Important Equations for Your Retirement...And the Stories Behind Them" Moshe Milevsky argues that twenty first century retirement income planning is indeed a science and has its foundations in the work of great sages who made conceptual and controversial breakthroughs over the last eight centuries.In the book Milevsky highlights the work of seven scholars--summarized by seven equations--who shaped all modern retirement calculations. He tells the stories of Leonardo Fibonnaci the Italian businessman; Benjamin Gompertz the gentleman actuary; Edmund Halley the astronomer; Irving Fisher the stock jock; Paul Samuelson the economic guru; Solomon Heubner the insurance and marketing visionary, and Andrey Kolmogorov the Russian mathematical genius--all giants in their respective fields who collectively laid the foundations for modern retirement income planning.With baby boomers starting to hit retirement age, planning for retirement income has become a hot topic across the countryAuthor Moshe Milevsky is an internationally-respected financial expert with the knowledge you need to assess whether you are ready to retire or notPresents an entertaining, informative narrative approach to financial planningUnderstanding the ideas behind these seven foundation equations--which Moshe Milevsky explains in a manner that everyone can appreciate--will help baby boomers better prepare for retirement. This is a book unlike anything you have ever read on retirement planning. Think Suze Orman meets Stephen Hawking. If you ever wondered what the point of all that high school mathematics was, Moshe Milevsky's answer is: "So that you can figure out how to retire...while you can still enjoy your money."...
|Title||:||7 Most Important Equations for Your Retirement: The Fascinating People and Ideas Behind Planning Your Retirement Income|
|Number of Pages||:||210 Pages|
|Status||:||Available For Download|
|Last checked||:||21 Minutes ago!|
7 Most Important Equations for Your Retirement: The Fascinating People and Ideas Behind Planning Your Retirement Income Reviews
The seven most important equations for your retirement is not actually a “how-to” book on retirement planning. Instead the author, Moshe A. Milevsky, discuses seven equations related to retirement planning. Milevsky is a professor in the business school of York University in Toronto. The seven equations deal with 1) how long a sum of money will last given particular rates of spending and interest (the interest you earn on the money you haven’t yet spent), 2) the Gompertz equation that predicts mortality rates, 3) how much you should pay for an annuity, 4) how fast you should spend your money, 5) how you should allocate your money among investments varying in risk your personal aversion to risk, 6) life insurance, and 7) how sustainable your retirement plan is if you or your spouse live longer than you expect. Milevsky associates each of these equations, with varying degrees of plausibility, to various authors on finance, mathematics, or economics. Leonard Fibonacci gets credit for the first equation, because he seems to have been the one who came up with the idea of present value (calculating how much money you expect to receive in the future would be worth right now), even though he lived long before modern algebraic notation was developed. Benjamin Gompertz realized that mortality rates increase exponentially with age, but never wrote down the second equation – but he seems to have written something pretty close to it. Edmond Halley (the comet guy) did indeed investigate the mathematics of annuities, American economist Irving Fisher (1867-1947) did come up with an equation describing how fast you should spend your money, and another American economist, Paul A. Samuelson (1915-2009), did derive an equation that works out how you should allocate your investments based on your attitudes towards risk. However, Solomon S. Huebner, although an important figure in the development of the economics of insurance, didn’t write down anything like the sixth equation; actuaries were working with similar equations before Huebner’s time. Andrei Kolmogorov (1903-1987), a giant figure in mathematics, did work out the last equation in pursuing his work in probability theory. Ironically, the equations associated with Samuelson and Kolmogorov are basically inconsistent with one another, because Kolmogorov’s equation does allow for valuing one’s personal aversion to risk. Personally I didn’t find Samuelson’s perspective helpful. Some of the equations are complicated algebraically. One of the equations, Kolmogorov, is a partial differential equation. Milevsky explains each term in the equation; some of the later equations build upon concepts introduced in earlier chapters, so you may need to refer back to earlier chapters if you forget what a term represents. Readers who are less comfortable with equations may still get something out of the boo, as Milevsky presents in tabular form the outcomes of the equations given various assumed returns, life expectancies, and so on. Some results are displayed graphically. There is a list of sources by chapter in the end of the book.
I really enjoyed this book. I've just completed an MBA in Finance and it was an interesting perspective on financial engineering and actuarial science. They don't teach you actuarial science in business school, so chapters 2-6 were new for me. I learned how to do NPV analysis in business school and I apply the tools I learned in modern portfolio theory to optimize my portfolio for retirement. This book fills the hole in figuring out if what I am doing will likely be enough. I'll be adding the analysis to my R programs for managing my investment portfolios.The approach in the book is rather breezy and is a historical approach to the development of these equations presented in the book.
The Seven Most Important Equations for your Retirement introduces you to the ideas and people behind retirement planning. The premise sounded amazing. I love personal finance. I love math. I love history. The three together should have been a winning combination. However, the book failed to deliver.Moshe doesn't bring these stories to life in the same way a Malcolm Gladwell would. Each biography feels underdeveloped, and therefore uninteresting. We get to learn what each contributor did, but not why they did it.The mathematical examples used to illustrate each equation are unclear. Moshe uses examples from his own life, often skipping steps or omitting figures in his math to arrive at an answer. The reader is left feeling "Okay....but how does this work with my numbers?"
Thoroughly enjoyed this compelling and sensible approach as food for thought. Milevsky's explanations of the equations and their historical underpinnings was nicely presented. Well-written, useful, and easy to read.
This book covers significant equations that relate to retirement. The author describes the historical roots of the equations, the lives of the people who set the stage for the equations, and the potential applications of the equations to retirement income planning.If all of those aspects don't interest you, then this book may be a boring read. But if your curiosity has been piqued, then this book will be surprisingly captivating.There are lots of surprising conclusions from the equations (e.g. stock allocation changes over a lifetime depend more on future earning potential than on perceived decreasing risk), so this book is a good counterpoint to some of the more commonly-referenced (but perhaps outdated) research around things like "safe withdrawal rates" and asset allocation "rules" like "your age in bonds."
This is a surprising easy to understand book ... the concepts not necessarily the equations. For me, the best part is chapter 7 which covers sustainability of retirement savings. I have done a lot of reading in this area but this is the first time I have come across the approach. It is so logical. Why don't more financial planners use it? Don't expect a recipe for retirement planning. However, if you want to understand the essential elements of retirement planning and their historical origin, this book is highly recommended.
Enjoyed it. Milevsky picked 7 equations related to the question of determining how long retirement savings would last, and describes their application, origins and history. One chapter per equation. The equations build from straight forward calculations of how long an amount will last at a given return and withdrawal rate, to conclude in the final chapter with calculations of how probable a nest egg will be sustainable based on a number of variables (including some interesting mortality rate stats described in an earlier chapter). Fun stuff - made me wonder if I should have been an actuary.
I love the biographical details provided behind the "great names." The author explains very clearly why each of the equations is so important, and then takes a few "what if" numbers and runs them through("what if you live to be 95 and need more than $25,000 a year to live on?"). The scenario calculations are typical for retirement planning workbooks, but it's the historical asides that make the book such a delight to read.