How should I take the marshmallow test?

So we're all familiar with the marshmallow test. I recently ran into a perfect real-life version. A former employer of mine actually has a defined benefit pension plan. I only qualified for it for a brief period of time, so I recently received the following offer:

I can either get a lump sum payment of nearly $8k today or get a monthly amount of ~$165 once I retire circa 2050. Obviously it's almost certainly better to take the DB payment since they're assuming all of the longevity and market risk and it diversifies my income stream in retirement, right? Not to mention the loss in taxes. So marshmallow test passed.

And yet, I've been thinking that maybe it doesn't make all that much sense to wait. The amount is a trifle (what will $165 buy each month in 2050? A few days of groceries?), and the hassle in keeping track of this information for the next 30-odd years is substantial. And I firmly expect to be capital rich but low consumption in early retirement while my current situation is decidedly the reverse; why not take a small boost to my buying power now over a largely irrelevant income stream in retirement?

I'm curious what you guys think - the amounts are essentially trifling so this decision has rather less import than most, but it made me think about the marshmallow test in a new light. It's traditionally seen as a way to determine the ability of a small child to delay gratification in anticipation of a greater reward. And yet this model ignores questions of time varying marginal utility: a single marshmallow now might indeed provide more overall utility than two marshmallows in the future. In fact, most NPV-type calculations also ignore this question; it's not necessarily a failing to value current consumption over future consumption, especially if the marginal marshmallow in the (marshmallow-rich) future is worth less than the marginal marshmallow in the (sadly, marshmallow-poor) present.

Assuming a 6% growth rate, 8k today will be generate $273/mo in 2050. At 5%, it's ~$167. If you assume historical trends will continue, then it makes more sense to take the lump sum. If you assume historical trends will not continue, then having the money available for whatever happens will be safer than having it inaccessible and possibly not even there when you retire. Either way, take the lump sum.

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Originally Posted by Wraith

Assuming a 6% growth rate, 8k today will be generate $273/mo in 2050. At 5%, it's ~$167. If you assume historical trends will continue, then it makes more sense to take the lump sum. If you assume historical trends will not continue, then having the money available for whatever happens will be safer than having it inaccessible and possibly not even there when you retire. Either way, take the lump sum.

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Is there any possibility your employer may offer you a better buy-out at some later date, just to get rid of the administrative headache of your staying in their plan?

Also, the number of years you expect to live into retirement is a factor of your calculation. How many do you assume?

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Originally Posted by Wraith

Assuming a 6% growth rate, 8k today will be generate $273/mo in 2050. At 5%, it's ~$167. If you assume historical trends will continue, then it makes more sense to take the lump sum. If you assume historical trends will not continue, then having the money available for whatever happens will be safer than having it inaccessible and possibly not even there when you retire. Either way, take the lump sum.

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That's not the entirety of the analysis, Wraith. First, assuming 6% growth (or even 5%) is not at all obvious - there's a huge amount of market risk, especially with demographic trends and low trend growth suggesting a new normal of a savings rich, return poor environment - and this doesn't even take into account tapering off risk (and return) in later years to reduce volatility. By taking the guaranteed income stream one is completely avoiding market risk. One is also avoiding other volatility issues - investing the lump sum and skimming off returns in retirement is subject to a great deal of market volatility (unless I buy an annuity, which is essentially the same as leaving it in the DB plan). The advantages of a DB component to a mostly DC-funded retirement (I fully expect most of my retirement to be funded with 401(k)s, Roths, taxable investments, and possibly some equity stakes in private firms) is that is provides a nice floor while the rest of the funding can fluctuate with markets, allowing one to take greater risk (and hence greater returns) in retirement.

I'm also not at all worried about the solvency of the pension plan. The institution providing it has ample reserves and isn't going anywhere. There's also some complicated details I didn't mention - the monthly stipend amount may actually be higher if actual returns are higher than forecast; without knowing too much about their models it's hard to know how likely that is.

I get where you're coming from - I, too, tend to think that my relatively aggressive and optimistic investing stance would stand me in good stead compared to a relatively tame pension fund, and I like to be in control of my money. But having a chunk of income (like SS) that is immune to market and longevity risk is worth some consideration, especially if on a strict mathematical analysis it's probably close to a wash. Pension funds like to do this because it's 'derisking' and reduces other management costs; should I voluntarily take on that risk just for some marshmallows now?

Also, I really don't like marshmallows. I would totally have screwed with the results of that test. Maybe a peanut butter cup would have worked better.

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Originally Posted by EK

Is there any possibility your employer may offer you a better buy-out at some later date, just to get rid of the administrative headache of your staying in their plan?

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Yeah, they update the lump sum offer every period (year? quarter? don't recall). It's based on their model for funding their pension fund. Obviously the lump sum gets higher over time, but the benefits of having money now rather than later also decrease over time.

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Originally Posted by wiggin

That's not the entirety of the analysis, Wraith. First, assuming 6% growth (or even 5%) is not at all obvious - there's a huge amount of market risk, especially with demographic trends and low trend growth suggesting a new normal of a savings rich, return poor environment - and this doesn't even take into account tapering off risk (and return) in later years to reduce volatility.

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I gave two options, this one only applies to the assume status-quo option. I have no faith in the status-quo, but you usually seem to.

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By taking the guaranteed income stream one is completely avoiding market risk. One is also avoiding other volatility issues - investing the lump sum and skimming off returns in retirement is subject to a great deal of market volatility (unless I buy an annuity, which is essentially the same as leaving it in the DB plan). The advantages of a DB component to a mostly DC-funded retirement (I fully expect most of my retirement to be funded with 401(k)s, Roths, taxable investments, and possibly some equity stakes in private firms) is that is provides a nice floor while the rest of the funding can fluctuate with markets, allowing one to take greater risk (and hence greater returns) in retirement.

I'm also not at all worried about the solvency of the pension plan. The institution providing it has ample reserves and isn't going anywhere. There's also some complicated details I didn't mention - the monthly stipend amount may actually be higher if actual returns are higher than forecast; without knowing too much about their models it's hard to know how likely that is.

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If you're not going to assume status quo, then why would you assume the pension provider is safe from bankruptcy? Why assume the economy in 33 years is going to look anything like the economy today? Cutting pension benefits has been done in the past for companies with once bright and certain futures that hit hard times. Better to have the flexibility to adjust as needs demand.

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Yeah, they update the lump sum offer every period (year? quarter? don't recall). It's based on their model for funding their pension fund. Obviously the lump sum gets higher over time, but the benefits of having money now rather than later also decrease over time.

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This actually does change things a bit, as there's not as much risk in delaying the choice. You're probably safe for the next few years, but I'd still plan on taking the lump sum eventually, and sooner rather than later.

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Originally Posted by Wraith

I gave two options, this one only applies to the assume status-quo option. I have no faith in the status-quo, but you usually seem to.

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Fair enough, but assuming the status quo changes doesn't assume that the best place for my money is in my own accounts; a large institution may be much better situated to handle future turbulence than I am.

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If you're not going to assume status quo, then why would you assume the pension provider is safe from bankruptcy? Why assume the economy in 33 years is going to look anything like the economy today? Cutting pension benefits has been done in the past for companies with once bright and certain futures that hit hard times. Better to have the flexibility to adjust as needs demand.

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In principle you're right. In reality, the institution in question is not a company but a nonprofit with vast resources and a nearly unassailable position in the market. I would be hard pressed to come up with a scenario where they wouldn't be good for the money absent such dramatic changes to the world that my retirement income would be the least of my concerns.

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This actually does change things a bit, as there's not as much risk in delaying the choice. You're probably safe for the next few years, but I'd still plan on taking the lump sum eventually, and sooner rather than later.

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Oh, of course. I didn't start this thread for advice on what to do - currently given our fiscal outlook we're likely to delay this decision for a while - but more to discuss the complexities of the marshmallow test. This was just a nice story to frame it.

This seems simple to me: take the money upfront. Why are you renting-out your money to an institution with whom you have no remaining affiliation beyond this pension, and whom —*no matter what you may think about their stability —*may not exist in a few decades? How many times have you heard about rock-solid pensions falling apart?

The best case scenario is they meet their minimum obligations to you, and you don't have access to that money for your own use or investment for the next few decades. Take the money now, save/invest it diligently and take advantage of compounding without the middleman.

Is the $165 index-linked at all or what it will be in nominal terms?

If it's not index-linked at all then the Present Value of Money for $165/mo does not seem that impressive.

"The amount is a trifle (what will $165 buy each month in 2050? A few days of groceries?), and the hassle in keeping track of this information for the next 30-odd years is substantial."

Honestly... this. If it is a trifle and will be a hassle than screw it. Less risk this way too (you could croak before that time).

I faced a similar "test" during my divorce. Should I fight for half of his state pension, if it meant he'd get half of my investment portfolio?

I wouldn't categorize that as part of the marshmallow test, because that only looks at delayed gratification within a relatively short time frame, and doesn't really account for LONG TERM life decisions that depend on so many other factors.

Might as well as people if they're willing to pay x% of their wages for a guaranteed retirement pension called Social Security.

SO...if you think you'll be asset rich in the future any way, why not opt for the annual payments? If you fall on hard times (and all your investments tank) having a couple hundred bucks guaranteed for 'just groceries' would be a good thing.

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Originally Posted by Wraith

Assuming a 6% growth rate, 8k today will be generate $273/mo in 2050. At 5%, it's ~$167. If you assume historical trends will continue, then it makes more sense to take the lump sum. If you assume historical trends will not continue, then having the money available for whatever happens will be safer than having it inaccessible and possibly not even there when you retire. Either way, take the lump sum.

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Afaict employers typically underestimate the fair present value of future payments when making these offers. Would you mind helping me understand your calculation?

If the payments are adjusted regularly based on how the underlying investments are doing, it should be fair to expect them to be at least somewhat index linked.

Deferring the payment reduces risk, increases convenience, and may be beneficial from a tax perspective. If you don't want to stay up to date and actively manage this, then you don't really have to, unless this deal will for some reason regularly require your active participation. No doubt receiving pensions will be simpler in the glorious automated future.

The future is uncertain, but I have no doubt your recent employer's future prospects are better than that of pretty much any other pension-offering entity and at least comparable to the prospects of the market.

If it's considered to be a trivial sum in the future, then foregoing the lump sum now should be about as trivial from an investment perspective, even though a windfall like that can obviously be used to do something fun now :o

With all that said, I'd personally take the money now, unless it'd come with a major tax hit. I'm not entirely sure society will exist in 2050 after the hostile AI revolution and I can put the money to better use today than I expect I will in 2050. Pretty sure you'll put it to better use, too.

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Originally Posted by Dreadnaught

This seems simple to me: take the money upfront. Why are you renting-out your money to an institution with whom you have no remaining affiliation beyond this pension, and whom —*no matter what you may think about their stability —*may not exist in a few decades? How many times have you heard about rock-solid pensions falling apart?

The best case scenario is they meet their minimum obligations to you, and you don't have access to that money for your own use or investment for the next few decades. Take the money now, save/invest it diligently and take advantage of compounding without the middleman.

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I'm not renting out the money - I'm leaving them with substantial market and longevity risk. The immediate payout is not particularly stingy, but it isn't particularly generous either; they almost certainly have a better chance of getting a decent return than I do given their scale. And I have literally zero concerns about this institution's finances or stability. They're not quite as good as the US government in this regard, but they have the advantage of being subject to less policy/political risk.

There's another factor most have so far neglected to note: the 8k I could get tomorrow would be taxable, while the in-fund compounding is tax free; that's a huge advantage in favor of leaving it in the pension.

Honestly, the big thing that keeps me from jumping on it is the longevity risk: no matter how diligently I plan, it's very hard to plan around longevity. The more assets I have already in defined benefit plans (like pensions or Social Security or annuities) the more comfortable I am with accepting some higher risk in my self-managed assets. This amount might not be much, but every bit adds up, no? The only real reason to take the money isn't that I think I can beat a pension fund in investment returns but that my marginal utility for using the funds (for, say, 5% of a downpayment on a house or whatever) is higher now that it will be in 30-odd years.

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Originally Posted by RandBlade

Is the $165 index-linked at all or what it will be in nominal terms?

If it's not index-linked at all then the Present Value of Money for $165/mo does not seem that impressive.

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AIUI it is a flat benefit, though there are also options to change things like how payout works for spouses and such (which obviously change the payout amount). It's possible to take the lump sum and invest it in an annuity that tracks inflation, of course, but that's more expensive and has a substantially lower monthly income.

Agreed it's not much money - honestly either way will not materially change my life. This is more a thought experiment than anything serious.

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Originally Posted by GGT

SO...if you think you'll be asset rich in the future any way, why not opt for the annual payments? If you fall on hard times (and all your investments tank) having a couple hundred bucks guaranteed for 'just groceries' would be a good thing.

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I agree that guaranteed income has its place, but if I am indeed asset rich in the future there is substantially higher utility for the money for me today than in 30-odd years. My major consumption is obviously currently being paid for by salaries, but I have some big savings/investing goals that could always use another $8k boost: retirement of course, but more immediately my daughter's college fund and our house savings. Those are big ticket items that take a lot of capital early on in one's life, when capital is in short supply.

I honestly think you should stop thinking of this as "guaranteed income". Nothing is guaranteed, and the scale of your sponsor organization really has a trivial impact on returns versus any other mutual fund. I empathize with the psychological pull of having something that feels safe and off-to-the-side compared to more risky investments, but I think you over-estimate both the "safety" of this small DB plan and under-estimate your own ability to structure your investments to hedge against risk.

If you die before this payout, is it going to be easy for your heirs to get even a slice of this money?

If you're worried about the taxation, you can open a roth IRA (or a backdoor IRA if you make too much —*certainly doable for $8K).

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Originally Posted by Dreadnaught

I honestly think you should stop thinking of this as "guaranteed income". Nothing is guaranteed, and the scale of your sponsor organization really has a trivial impact on returns versus any other mutual fund. I empathize with the psychological pull of having something that feels safe and off-to-the-side compared to more risky investments, but I think you over-estimate both the "safety" of this small DB plan and under-estimate your own ability to structure your investments to hedge against risk.

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Obviously it ain't guaranteed, but it's fair to say that it's better to offload market and longevity risk onto someone else if you can, no? And large pensions have access to all sorts of illiquid investments that are not available to your typical retail investor; if they're smart about it, they should typically be able to perform better than I could by socking it into an index fund (which is where the vast bulk of my investments go).

I guess my point is that this is a method of hedging - I have 95+% of my assets tied up in self-managed accounts, which comes with attendant market and longevity risk (as well as various political/policy and institutional risks), while I could either take the remainder and do the same thing with it, or let it roll with a different set of risks as a small hedge against the bulk of my assets. That's been my policy for self-managed assets wrt taxes: I put some money into Roth accounts, which reduces the principal available for investment but avoids the risk of me being in a higher tax bracket during retirement; the rest is in tax-deferred accounts a la IRA or 401(k)s, which are the flip side. If I had a crystal ball it would obviously make sense to choose whichever gives me better overall post-tax returns, but in the absence of that knowledge I spread my bets around. Hell, that's what index funds are themselves. Why not do the same here? It's largely trivial money, but any hedging helps, neh?

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If you die before this payout, is it going to be easy for your heirs to get even a slice of this money?

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I'm not sure but I would imagine that spouses get some sort of benefit. It's hardly a big enough amount of money for me to dig through the fine print.

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If you're worried about the taxation, you can open a roth IRA (or a backdoor IRA if you make too much —*certainly doable for $8K).

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I'd have to do a conversion now, which is certainly feasible but a bit of a pain. But that doesn't solve the problem - of COURSE I would use every available (legal) way of sheltering my investments from taxation, but a Roth is post-tax money, so imagining that I'm in a ~30% marginal bracket, that $8k ends up really being about $5.5k even before I invest it. Sure the proceeds are tax free (assuming Roths aren't nerfed in the future), but you have to make enough of a return on the post-tax money to make up for that - it all depends on relative marginal tax rates now and in 30-odd years. And honestly I'm not sure I have enough space left on my contribution limits to even do that (though the kid's college fund allows large lump sums, so that's one way to shift the capital).

*shrugs* This is not something I'm spending a lot of time worrying about right now; I suspect the next time I'll consider taking it out is for a downpayment. The amounts are so small and the likely difference in returns is small enough that it's not worth agonizing over. I just thought this was an interesting thought experiment about time-varying marginal utility.

No amount of money is worth agonizing over, but for 100k in 40 years I would consider at least furrowing my brow a little.

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Originally Posted by wiggin

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I agree that guaranteed income has its place, but if I am indeed asset rich in the future there is substantially higher utility for the money for me today than in 30-odd years. My major consumption is obviously currently being paid for by salaries, but I have some big savings/investing goals that could always use another $8k boost: retirement of course, but more immediately my daughter's college fund and our house savings. Those are big ticket items that take a lot of capital early on in one's life, when capital is in short supply.

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Been there, done that. Since hindsight is 20/20 I'd suggest you NOT put money into a college fund for your daughter; she can get academic (or athletic) scholarships, public grants or loans to help pay for that. That makes it her choice, goal, and responsibility, not yours.

<I'm remembering a conversation I had with Loki years ago about my desire to have a 'college fund' for my kids, so they wouldn't have to go into debt to get a degree. He was right--I should have used that money for my retirement savings instead.>

Ditto for the house-related savings. Don't spend money on a house (or a mortgage) hoping it will turn out to be an "investment" after you sell. The housing market is too chaotic and unpredictable. Considering that I "bought" my kids' K-12 education by zip code, I could have saved a lot of time and money in a much smaller house, in a different neighborhood, or even by renting.

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Originally Posted by GGT

Been there, done that. Since hindsight is 20/20 I'd suggest you NOT put money into a college fund for your daughter; she can get academic (or athletic) scholarships, public grants or loans to help pay for that. That makes it her choice, goal, and responsibility, not yours.

<I'm remembering a conversation I had with Loki years ago about my desire to have a 'college fund' for my kids, so they wouldn't have to go into debt to get a degree. He was right--I should have used that money for my retirement savings instead.>

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I am not putting money into a college fund at the expense of retirement savings; that's obviously a stupid move. We have pre-determined the amount of savings we would like to put towards retirement each year; this is money in addition to that. It's also a good avenue for gifts from relatives; our daughter doesn't need more toys, but she sure as hell could use a college education.

I have no intention of fully funding the college education of my children; that would be a challenging sum of money to save, given the time scale, competing spending/saving priorities, and our projected number of children (not to mention the likely price tag of a private university in two decades). But if we could save enough for 3 or 4 semesters that would dramatically reduce any debt burden they would have to carry in the future (we could probably kick in enough extra cash for living expenses as well, since we'd no longer be paying for high school).

I strongly suspect that our family will fall into a financial aid trap: we'll make too much to qualify for much financial aid (or many subsidized loans), but we will not make enough money to reasonably pay for college. Relying on uncertain and inadequate scholarships is not a particularly responsible option; I qualified for substantial academic scholarships and my family qualified for substantial financial aid but it was still the smallish college fund my parents and grandparents had seeded that kept me from needing any non-subsidized student loans. I would like to give my children a similar opportunity, if possible.

My children will still likely work during school, they will probably end up carrying some modest debt out of school, and there's no way I'm paying for their further professional/graduate schooling. But if I can lessen the early capital burden I will.

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Ditto for the house-related savings. Don't spend money on a house (or a mortgage) hoping it will turn out to be an "investment" after you sell. The housing market is too chaotic and unpredictable. Considering that I "bought" my kids' K-12 education by zip code, I could have saved a lot of time and money in a much smaller house, in a different neighborhood, or even by renting.

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I need savings for a house so I have somewhere to live and rentals of an appropriate size are hard to come by - as our family grows it seems unlikely we'll be able to squeeze into a smallish 2 BR apartment indefinitely. This is hardly some high flying investment scheme; the value of my home once purchased may indeed appreciate but I am not counting on it. For complex reasons I am limited in my choice of neighborhood and the price points are eye-watering; saving up for a downpayment is, again, not at the expense of retirement savings but an obvious and responsible choice.

Sounds like you've already made up your mind, and aren't really asking for advice but validation.

I don't need advice on my savings goals. I also don't really need advice on what to do with a piddling amount of money in a pension. As I have mentioned multiple times in this thread, I was using it as a foil to discuss time-varying marginal utility and how that feeds into delay of gratification etc. Sadly, very few people have taken me up on that side of the discussion, which is what I was actually aiming for. No offense to you folk, but the only person I'm going to listen to on this is my wife because, well, it's her future too.

Then why did you ask? A foil for discussing time-varied utility under the guise of delayed gratification? WTF

And what did you mean by "you folk"?

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Originally Posted by GGT

Then why did you ask? A foil for discussing time-varied utility under the guise of delayed gratification? WTF

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I've been very clear about my goals for the entire thread, GGT. It's way more interesting of a discussion than what to do with $8k.

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And what did you mean by "you folk"?

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Uh, the members of this forum? Obviously you're all going to have a challenge giving useful advice on something like this without way more detail, detail which I'm never going to share on the internet. There are reasons to go to the internet for information, of course - say I need to know which sites to see in Istanbul (Hazir), or how library funding and operations work in the US (OG), or an obscure definition in the political science literature (Loki). That's because I'm relying on expertise that each of you have. But when the decision is essentially tied up in a full understanding of my own financial situation and life priorities, obviously the main person to talk to is my wife. I don't really understand how this is controversial.

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Originally Posted by wiggin

Obviously it ain't guaranteed, but it's fair to say that it's better to offload market and longevity risk onto someone else if you can, no? And large pensions have access to all sorts of illiquid investments that are not available to your typical retail investor; if they're smart about it, they should typically be able to perform better than I could by socking it into an index fund (which is where the vast bulk of my investments go).

I guess my point is that this is a method of hedging - I have 95+% of my assets tied up in self-managed accounts, which comes with attendant market and longevity risk (as well as various political/policy and institutional risks), while I could either take the remainder and do the same thing with it, or let it roll with a different set of risks as a small hedge against the bulk of my assets. That's been my policy for self-managed assets wrt taxes: I put some money into Roth accounts, which reduces the principal available for investment but avoids the risk of me being in a higher tax bracket during retirement; the rest is in tax-deferred accounts a la IRA or 401(k)s, which are the flip side. If I had a crystal ball it would obviously make sense to choose whichever gives me better overall post-tax returns, but in the absence of that knowledge I spread my bets around. Hell, that's what index funds are themselves. Why not do the same here? It's largely trivial money, but any hedging helps, neh?

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I think we have a different view on how this actually offloads any risk —*to me this increases risk and offers reduced control/optionality. You think this takes the risk out of your hands, but it's still your money and now someone else will control it and pay you someday assuming they can. I don't see the benefit, just added complexity and some level of risk.

I'm not sure how you're using the word 'optionality' here, but I get the gist. I think that all retirement plans - DB, DC, and variants thereof - try shifting risks around to improve outcomes. But fundamentally they don't really get rid of risks, they are just shifted from one sort of risk to another. In the case of a DB pension like I'm talking about, the individual has no market or longevity risk, but they have some institutional/policy risk and reduced control. DC funds try to eliminate the chance of your pension being underfunded or the funding organization going under (and gives people more control), but it adds a lot of other risks onto the individual. IIRC there was a nice piece about this a while back but I can't find it right now; I'll see if I can get it later.

My argument isn't that one side or another isn't without risks - there are always risks - but that by diversifying the type of risk one is exposed to, it decreases the chance of wholesale catastrophe to one's retirement savings.

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Originally Posted by wiggin

I've been very clear about my goals for the entire thread, GGT. It's way more interesting of a discussion than what to do with $8k.

Uh, the members of this forum? Obviously you're all going to have a challenge giving useful advice on something like this without way more detail, detail which I'm never going to share on the internet. There are reasons to go to the internet for information, of course - say I need to know which sites to see in Istanbul (Hazir), or how library funding and operations work in the US (OG), or an obscure definition in the political science literature (Loki). That's because I'm relying on expertise that each of you have. But when the decision is essentially tied up in a full understanding of my own financial situation and life priorities, obviously the main person to talk to is my wife. I don't really understand how this is controversial.

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What I post isn't 'controversial', and my 'expertise' comes from life experience. If you only consider your wife's opinion, in the end, then why bother with forums like this? :confused:

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Originally Posted by wiggin

I'm not sure how you're using the word 'optionality' here, but I get the gist. I think that all retirement plans - DB, DC, and variants thereof - try shifting risks around to improve outcomes. But fundamentally they don't really get rid of risks, they are just shifted from one sort of risk to another. In the case of a DB pension like I'm talking about, the individual has no market or longevity risk, but they have some institutional/policy risk and reduced control. DC funds try to eliminate the chance of your pension being underfunded or the funding organization going under (and gives people more control), but it adds a lot of other risks onto the individual. IIRC there was a nice piece about this a while back but I can't find it right now; I'll see if I can get it later.

My argument isn't that one side or another isn't without risks - there are always risks - but that by diversifying the type of risk one is exposed to, it decreases the chance of wholesale catastrophe to one's retirement savings.

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Yes, life is full of risk....but getting old is even riskier! You've obviously made the decision that bringing a child into the world is a "good thing" because you're already a parent. That decision, framed as a choice, puts you in a special category that millions don't share. It also comes with a greater degree of responsibility; I get that. First world problems, among the top tiers of a population, don't make your decisions any easier. It's a true quandary.

Hindsight is 20/20....and I'm trying to tell you (based on my experience) that living in a certain zip code, even if it means better public schools for your children, may not be worth it 10 or 20 years from now. In fact, the job you have now (with its defined benefits) may not be "worth" the prices you pay in other areas, and can't be compensated in any way. Try getting to your kid's soccer games or musical performances, for example.

I grew up in the 60's, considered the "sandwich generation". We had plenty of wealthy and absent parents (especially fathers)....but that was a totally different era, culturally and otherwise. Have we evolved much in my lifetime? Yes. With qualifiers.