Q. The capital investment appraisal techniques such as NPV, IRR, ARR, PV and Time value of money have become irrelevant post Celtic Tiger. Due to the depth of the recession companies do not have budgets to invest. Discus
First use this information when you are writing this essay:
The impact of the recent market downturn on retirement savings continues to draw attention in mainstream media. In early March, the prominent news program Morning Edition on National Public Radio aired a three-part series called "Retirement Planning: Beyond the Downturn." The first installment focused on the impact of the market downturn. It noted that at the bottom of the downturn, the value of retirement savings in 401(k) accounts and IRAs had shrunk by $2 trillion. According to one survey, some participants said that the collapse of their retirement savings was equal to the stress they felt after the attacks on 9/11. A "typical" 401(k) investor lost 30% due to the downturn. The segment then presented the investment advice of John Bogle, the founder of the Vanguard Group, who believes that the percentage of bonds in a retirement portfolio should be roughly equal to the participant's age. He adds, however, that the calculation should include the value of Social Security benefits, which for the average American is equal to about $300,000 worth of bonds. The segment noted that financial planners disagree whether the stock portion should include international stocks. Finally, it concluded with the need to control the fees charged on the account's investments. The second segment discussed target-date funds, which are now offered by 70% of 401(k) plans, although only about 7% of total 401(k) assets are held in these funds.