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by lotsofpulp
3005 days ago
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Being off by 1% or 2% is huge. For example, look at page 24 and see what the differences could be. Every 1% change in discount rate can lead to changes of ~15% in liability. https://www.varetire.org/Pdf/Publications/VRS-Stress-Test-an... There's a reason that non-taxpayer funded entities have to use much more conservative discount rates, based on high grade bonds. Might be a around 4% or 5%. No reason for taxpayer funded pension plans to be using anything riskier. |
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