Suppose that you inherited from a rich relative an allowance of $50,000 a year, starting tomorrow, when

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Suppose that you inherited from a rich relative an allowance of $50,000 a year, starting tomorrow, when your age is 60 (there are fewer years to use in the calculation than if we assumed that you were 20).

Could this (or similar cash-flow patterns) be seen as an asset?

What is the allowance worth today as a lump sum?

Bear in mind that there is a huge market where retirees trade a lump sum for an annuity (a regular amount received over a future period).

What other factors need to be considered?

Posted Date: Oct 03, 2021 09:52 PM

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Suppose that you inherited from a rich relative an allowance of $50,000 a year, starting tomorrow, when

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An inheritance is a financial term describing the assets passed down to individuals after someone dies Most inheritances consist of cash thats parked ... View the full answer

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