When figuring you the number of time periods within a person’s life for an IPS or another type of question, would you include ‘after death’ as a time period? Or would this only be included if they intended to gift money to charity or family members?
For an individual their IPS ends at death…
An individual’s IPS would end at death…but…couldnt gifting extend a time horizon?..i thought ive seen this in a problem
I always include post dealth as a time horizon IF the individual is wealthy and efficient transfer of assets should be considered.
If you say the investor has Multiple Time Horizons the last one would simply state, “The final stage would begin at Mrs. Smith’s retirement and end at her death upon which her remaining assets will be distributed to BigWilly and friends.”
Bigwilly is correct I just read somewhere is Schweser that IPS ends at death. Estate planning at death should be planned during retirement/before death. You should note however that disposal of assets after death should be planned in the post-retirement time horizon.
s23dino - In your response, if you were to plan to dispose of assets after the time of death, would this be considered another time horizon? Most people would have a plan in place prior to death and then would dispose of these assets as executed by the trust for the estate. The explanation above seems conflicting, can you explain it more clearly possibly w/ an example?
No, read our answers together…the IPS ends at Death. If assets are to be disposed in a certain manner, ie, trust, then you can state it but no it is not considered anotehr time horizon.
To clarify the main points: -IPS ends at death, it is not another time horizon. -If you have significant wealth the disposal of those assets should be planned during the post-retirement period. -If planning for assets beyond death is needed, you should state the need for this but it is not another time horizon. Now I’m not sure where you would state this it seems like it could be in time horizon for post-retirement, legal, and/or unique constraints. Hope this clears it up.
also, think about this: the portfolio you leave for other people (family, charity, foundation, etc) when you die… will actually be a part of that other people IPS, not yours. It is the same as in some examples when somebody gets an inheritance of xxx usd mio… you have to take it into account for his IPS (not for the poor guy who just died)
If the guy died and left them money, I wouldnt call him a “poor guy”, haha just busting your chops…
death = unique constraint ? Haha j/k