In prior posts, we’ve discussed the three M’s that constitute the actuarial process for keeping your spending in retirement on track and consistent with your spending goals:
- Measuring your Funded Status each year
- Monitoring your Funded Status from year to year, and
- Making changes in your assets or spending liabilities when your Funded Status falls outside a reasonable corridor (guardrails).
In this post, we will discuss two more M’s: Periodically Measuring and Managing your financial risks. If you have completed Steps 1 and 2 above as of January 1, 2026 and are contemplating increases in your spending plan this year, we suggest that now may be a good time to measure and possibly manage your financial risks before implementing your plan. Stress testing your assumptions is a relatively easy process using the Actuarial Financial Planner (AFP) to see what the results of changing assumptions or inputted data has on your Funded Status.
