RSM 450 Lecture 1 September 8th, 2017

What Factors determine how much I save for retirement?

 Cost of living
 Consumption Preferences
 Health Risks
 Porjected Interest Rates
 Income
 Family
 Assets
 Age
 Job Market
 Pension/Social Security

 Retirement saving is complex, although lifesaving models have been created

 Economic models rely on certain assumptions for math to work out,

 Bounded rationality: Humans are not perfect, and have imperfect information

Axioms of Expected Utility Theory

 Completeness, humans should be able to exprsss preferences or indifferences

 Continuity: