Lump sum payments that are not immediate

Do we remove from the portfolio at the present value or in full? I’ve seen cases for both, but in an individual IPS where they dont even list the risk-free rate I guess would assume simplicity and take out the entire lump sum. Sorry if this has already been discussed.

I think the biggest factor is whether or not they provide the Rf rate - if so, I always pull out the discounted value, assuming you would invest the cash in Tbills until the liability is due.

I agree, if the expense is: -certain (not potential) -more than a year away -AND they provide the risk free rate Then I will discount the present value.

I hit that one in Schweser #2 and was surprised they bothered (only made the return calc off by .01…close enough for rounding differences, imo).