NotesFAQContact Us
Search Tips
Peer reviewed Peer reviewed
PDF on ERIC Download full text
ERIC Number: EJ1106021
Record Type: Journal
Publication Date: 2016
Pages: 8
Abstractor: As Provided
ISSN: ISSN-1942-2504
An Introduction to Cost-of-Living Adjustments in Public Retirement Plans: Details Matter
Jennings, Penelope R.; Jennings, William P.; Phillips, G. Michael
American Journal of Business Education, v9 n3 p129-136 2016
While financial planning students are expected to be able to understand client retirement plans, subtle differences in cost-of-living adjustments can have major impact on the success of client retirement plans. This teaching note compares the cost-of-living adjustments in the largest government sponsored retirement systems and a hypothetical traditional privately sponsored plan. Using a Monte Carlo simulation, we estimate the impact on retirement experience from the different COLAs. These differences are large, with differing protection from future inflation and differing risk for running out of money during retirement. This teaching note will help instructors address Certified Financial Planner (CFP) Board Learning Outcome G.52 "Retirement Needs Analysis". The material may also be used in economics, human resources, public administration, and other classes addressing policy aspects of retirement plans.
Clute Institute. 6901 South Pierce Street Suite 239, Littleton, CO 80128. Tel: 303-904-4750; Fax: 303-978-0413; e-mail:; Web site:
Publication Type: Journal Articles; Reports - Research
Education Level: Higher Education; Postsecondary Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A
Grant or Contract Numbers: N/A