When you have finished this chapter, you should be able to
In this chapter, we turn to the other side of the life contingency risk, the possibility of outliving one's income, which is the retirement risk. As we noted in Chapter 10, the retirement risk is the complement of the risk of premature death. If the individual dies prematurely, he or she will have no need for funds accumulating for retirement. If the individual lives until retirement, provision made for premature death will be unused, but there is a need for retirement funds. Because either outcome could occur, the individual must make provision for both contingencies.
For the average college ...