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Author
Pietrzyk Radosław (Wrocław University of Economics, Poland), Rokita Paweł (Wrocław University of Economics, Poland)
Title
Stochastic Goals in Financial Planning for a Two-Person Household
Source
Statistics in Transition, 2015, vol. 16, nr 1, s. 111-136, rys., tab., bibliogr. s. 133-136
Keyword
Gospodarstwa domowe, Finanse prywatne, Optymalizacja, Planowanie finansowe
Households, Private finance, Optimalization, Financial planning
Note
summ.
Materiały z konferencji Multivariate Statistical Analysis 2014, Łódź.
The research project was financed by The National Science Centre (NCN) grant, on the basis of the decision no. DEC-2012/05/B/HS4/04081.
Abstract
In household financial planning two types of risk are typically being taken into account. These are life-length risk and risk connected with financing. In addition, also various types of events of insurance character, like health deterioration, are sometimes taken into account. There are, however, no models addressing stochastic nature of household financial goals. The last should not be confused with modelling factors that influence performance of financing the goals, which is a popular research topic. The problem of modelling goals themselves is, in turn, not so well explored. There are two main characteristics that describe a goal: magnitude and time. At least for some goals one or both of these characteristics may show a stochastic nature. This article puts forward a proposition of working goal time and magnitude into a household financial plan and taking their distributions into account when optimizing the plan. A model of two-person household is used. The decision variables of the optimization task are consumption-investment proportion and division of household investments between household members. (original abstract)
Accessibility
The Main Library of the Cracow University of Economics
The Library of Warsaw School of Economics
The Library of University of Economics in Katowice
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ISSN
1234-7655
Language
eng
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