consumption smoothing


A financial planning process that seeks to achieve a balance between the desire for a high standard of living and the need to accumulate sufficient assets for a secure retirement by "smoothing" out consumption behavior during the earning years. The process combines a gradual reduction in standard of living over a period of time with a greater emphasis on retirement savings.

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You may want to figure out a way to use consumption smoothing to the benefit of your company for the long term.

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The consumption smoothing that the financial adviser offered Hank allotted that he cut $300 a month from his discretionary income.

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Consumption smoothing must be a part of an individuals retirement strategy to ensure that an individual can enjoy the same quality of life even in retirement.

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