Praise ForThe Retirement Plan Solution
"Short, clear, complete, and always interesting. Best book on DC plans and what we should do-now."
—Charles D. Ellis, author, Winning the Loser's Game
"At a time when the world is in turmoil, along with retirement expectations, the authors have hit a home run. After reading this book, I have a plan. Read it for your path to retirement security."
—Dallas Salisbury, President and CEO, Employee Benefit Research Institute
"The Retirement Plan Solution offers a refreshing and provocative perspective on how to assess retirement needs, save to meet these needs, and manage the retirement payout process. In this time of financial turmoil, employees, plan sponsors, and financial advisors will find this highly practical resource volume both useful and humorous."
—Olivia S. Mitchell, Director, Pension Research Council, Wharton School
"The Retirement Plan Solution is a map to the future of 401(k) retirement plans. But it is not just a theoretical view of what could be. Instead, the authors describe the needs and trends that are already here, and then describe the changes that are developing to meet those needs. It is about the tomorrow that is happening today."
—Fred Reish, Managing Director, Reish Luftman Reicher & Cohen
"The respected authors have created a readable, timely, and very helpful book on all aspects of retirement planning. The suggestions are practical, the information is concise, and the book is highly recommended for anyone that is interested in sound financial planning."
—Moshe A. Milevsky, PhD, Finance Professor, York University, Toronto, Canada
"This is a must-read for people working in the retirement industry, as well as those who simply care about how to improve their chance of reaching a financially secure retirement. In a clear and simple fashion, the authors deliver one of the best books to date on inefficiencies in the current DC plan and potential improvements."
—Peng Chen, President, Ibbotson Associates
Table of Contents
- International Praise for The Retirement Plan Solution: The Reinvention of Defined Contribution
The Great American Retirement System?
- DEFINED BENEFIT AND DEFINED CONTRIBUTION
- THE DYNAMICS OF THE RETIREMENT PLAN
- ROOM FOR IMPROVEMENT IN THE ACCUMULATION PHASE
- THE RIGHT SORT OF EDUCATION
- OTHER WAYS OF RUNNING DEFINED CONTRIBUTION PLANS
- THE INDIVIDUAL'S ROLE IN DECUMULATION
- THE PLAN SPONSOR'S ROLE
- A FINAL THOUGHT: FROM BIGGEST TO BEST
- 1. Dc Version 2.0
I. The Dynamics of the Retirement Plan
- 2. More than You Ever Wanted to Know about Life Expectancy
3. Retirement Is Expensive
- 3.1. THE GOAL IS A TARGETED LEVEL OF INCOME REPLACEMENT
- 3.2. THE FUNDAMENTAL PENSION EQUATION AND THE DEFINED BENEFIT SYSTEM
- 3.3. A SIMPLE MODEL OF RETIREMENT PLAN ACCUMULATION AND DECUMULATION
- 3.4. BASE CASE RESULTS
- 3.5. WHEN TO START SAVING
- 3.6. THE BASE CASE MAY NOT BE A RELIABLE GUIDE
- 3.7. HOW TO ACT IN THE FACE OF UNCERTAINTY
- 3.8. APPENDIX: FURTHER ANALYSIS OF THE UNCERTAINTY ASSOCIATED WITH INVESTMENT RETURNS
4. Investment Returns Are All-Important
- 4.1. THE 10/30/60 RULE
- 4.2. GAMES AT A VIRTUAL CASINO
- 4.3. INVESTMENT ANALOGS
- 4.4. HISTORICAL RETURN PATTERNS
- 4.5. WHAT ARE THE LESSONS?
- 4.6. WHAT FOLLOWS?
- 4.7. HOW MUCH INVESTMENT RISK CAN YOU TOLERATE?
- 5. Sustainable Spending
II. Opportunities in the Accumulation Phase
6. Save More
- 6.1. EMPLOYERS WITH NO PLAN
- 6.2. EMPLOYEES WHO DO NOT ENROLL
- 6.3. EMPLOYEES WHO START SAVING TOO LATE
- 6.4. EMPLOYEES WITH LOW SAVINGS RATES
- 6.5. EMPLOYEES WITH GAPS IN CONTINUOUS PARTICIPATION
- 7. Limit Leakage
8. Invest Better
- 8.1. EVIDENCE OF WASTE
- 8.2. THE IMPORTANCE OF A GOOD DEFAULT OPTION
- 8.3. THE "TARGET DATE" SOLUTION
- 8.4. AND FOR THE INVESTMENT EXPERTS?
- 9. Reduce Fees
- 6. Save More
III. We Need the Right Sort of Education
- 10. Why the Waste? Because We're Only Human
- 11. Financial Education
iV. Other Ways of Running Defined Contribution Plans
- 12. Case Study—Australia
- 13. Three Defined Contribution Plan Models
- 14. Collective Defined Contribution
V. The Perspective of the Individual in Decumulation
15. The First Dial: Your Personal Spending Policy
- 15.1. STEP ONE: HOW TO KEEP SCORE—THE CURRENT POSITION
- 15.2. STEP TWO: WHAT ABOUT THE FUTURE?
- 15.3. STEP THREE: THE PROJECTED OUTFLOW—THE FIRST ATTEMPT TO QUANTIFY YOUR SPENDING PLAN
- 15.4. STEP FOUR: HOW LONG WILL YOUR ASSETS SUSTAIN YOUR SPENDING PLAN?
- 15.5. CHECKPOINT: IS THERE A GAP TO BE BRIDGED?
- 15.6. NEXT UP
- 16. The Second Dial: Your Longevity Protection Policy
17. The Third Dial: Investment Policy
- 17.1. A REMINDER OF OUR GOALS AND OUR CHOICES
- 17.2. A FRAMEWORK
- 17.3. TAKING OWNER-OCCUPIED REAL ESTATE INTO ACCOUNT
- 17.4. MANY RULES OF THUMB ARE JUST PLAIN WRONG
- 17.5. FOUR WEALTH ZONES
- 17.6. HOW YOUR WEALTH ZONE DETERMINES YOUR CHOICES
- 17.7. BEQUESTS
- 18. Product Innovation With Decumulation In Mind
- 15. The First Dial: Your Personal Spending Policy
VI. The Plan Sponsor's Role
19. Defined Contribution Plan Governance
- 19.1. THE PURPOSE OF DEFINED CONTRIBUTION PLAN GOVERNANCE
- 19.2. RISK MANAGEMENT
- 19.3. A DEFINED CONTRIBUTION PLAN'S PURPOSE AND OBJECTIVES
- 19.4. FIDUCIARY DUTY
- 19.5. WHAT SHOULD A PRUDENT EXPERT KNOW—AND WHEN?
- 19.6. NEW CHOICES BASED ON NEW KNOWLEDGE
- 19.7. IN SUMMARY
- 20. Defined Contribution Plan Effectiveness
- 21. The Defined Contribution Plan Sponsor's Role in Decumulation
- INTRODUCTION The Great American Retirement System?
- CHAPTER 1 DC Version 2.0
- CHAPTER 2 More than You Ever Wanted to Know about Life Expectancy
- CHAPTER 3 Retirement Is Expensive
- CHAPTER 4 Investment Returns Are All-Important
- CHAPTER 5 Sustainable Spending
- CHAPTER 6 Save More
- CHAPTER 7 Limit Leakage
- CHAPTER 8 Invest Better
- CHAPTER 9 Reduce Fees
- CHAPTER 10 Why the Waste? Because We're Only Human
- CHAPTER 11 Financial Education
- CHAPTER 12 Case Study—Australia
- CHAPTER 14 Collective Defined Contribution
- CHAPTER 15 The First Dial: Your Personal Spending Policy
- CHAPTER 16 The Second Dial: Your Longevity Protection Policy
- CHAPTER 17 The Third Dial: Investment Policy
- CHAPTER 18 Product Innovation with Decumulation in Mind
- CHAPTER 19 Defined Contribution Plan Governance
- CHAPTER 20 Defined Contribution Plan Effectiveness
- CHAPTER 21 The Defined Contribution Plan Sponsor's Role in Decumulation
- About the Authors
- 19. Defined Contribution Plan Governance
- Title: The Retirement Plan Solution: The Reinvention of Defined Contribution
- Release date: June 2009
- Publisher(s): Wiley
- ISBN: 9780470398852