What is your subjective risk tolerance?
Suppose that you are about to retire, and have two choices for a pension
- Pension A gives you an income equal to your preretirement income.
- Pension B has a 50% chance your income will be double your preretirement income, and a 50% chance that your income will be 20% less than your preretirement income.
You will have no other source of income during retirement, no chance of employment, and no other family income ever in the future.
All incomes are aftertax.
Which pension would you choose? Click on your choice below