A deferred variable annuity with a guaranteed lifetime withdrawal benefit is a retirement tool that can support protected lifetime income without having to annuitize assets until the contract value of the annuity depletes. This tool is controversial, with critics labeling it as too high cost and too complex for practical use. However, these annuities can have uses in a retirement income plan. For retirees expressing preferences for market growth, strategy commitment, asset liquidity, and longevity risk aversion, the variable annuity with a living benefit may serve as a suitable source for a protected lifetime income floor. Thus, this article aims to explain more about these potential uses and provide an understanding about how the guarantees for variable annuities work. Details such as the benefit base, contract value, rollup rate, step-up opportunities, and guaranteed withdrawal rates are explored to provide readers with a better sense of how to assess available variable annuity options and when they may be appropriate for a client.
{"title":"The Role and Inner Workings of Variable Annuities with Guaranteed Lifetime Withdrawal Benefits in Retirement","authors":"W. Pfau","doi":"10.3905/jor.2022.1.113","DOIUrl":"https://doi.org/10.3905/jor.2022.1.113","url":null,"abstract":"A deferred variable annuity with a guaranteed lifetime withdrawal benefit is a retirement tool that can support protected lifetime income without having to annuitize assets until the contract value of the annuity depletes. This tool is controversial, with critics labeling it as too high cost and too complex for practical use. However, these annuities can have uses in a retirement income plan. For retirees expressing preferences for market growth, strategy commitment, asset liquidity, and longevity risk aversion, the variable annuity with a living benefit may serve as a suitable source for a protected lifetime income floor. Thus, this article aims to explain more about these potential uses and provide an understanding about how the guarantees for variable annuities work. Details such as the benefit base, contract value, rollup rate, step-up opportunities, and guaranteed withdrawal rates are explored to provide readers with a better sense of how to assess available variable annuity options and when they may be appropriate for a client.","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"10 1","pages":"48 - 62"},"PeriodicalIF":0.0,"publicationDate":"2022-05-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44305829","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-04-30DOI: 10.3905/jor.2022.9.4.109
Warren Cormier, P. Hess, Karen Witham
{"title":"GUEST COMMENTARY: Equity and the Retirement Savings System","authors":"Warren Cormier, P. Hess, Karen Witham","doi":"10.3905/jor.2022.9.4.109","DOIUrl":"https://doi.org/10.3905/jor.2022.9.4.109","url":null,"abstract":"","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2022-04-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44176901","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We frequently read or hear about women saving less money for retirement while at the same time living longer. Women need to fund more years in retirement than men. Does this apply to all groups of women, regardless of race/ethnicity? It’s often stated this is not a retirement issue but rather an issue of pay inequity prior to retirement. Data suggest it is a issue of unequal pay, but that doesn’t mean the retirement industry can’t act to improve the situation for women employees. Let’s look more closely, think more deeply, focus more acutely. What can be done to help women of all races/ethnicities? A good start is to design a stronger defined contribution plan, implement auto features at greater levels, understand the employee base, and create effective, customized communication. These actions will drive women of all races/ethnicities forward to a more equal retirement footing with men.
{"title":"Women in Retirement: Living Longer, Less Money Saved","authors":"Toni Brown","doi":"10.3905/jor.2022.1.112","DOIUrl":"https://doi.org/10.3905/jor.2022.1.112","url":null,"abstract":"We frequently read or hear about women saving less money for retirement while at the same time living longer. Women need to fund more years in retirement than men. Does this apply to all groups of women, regardless of race/ethnicity? It’s often stated this is not a retirement issue but rather an issue of pay inequity prior to retirement. Data suggest it is a issue of unequal pay, but that doesn’t mean the retirement industry can’t act to improve the situation for women employees. Let’s look more closely, think more deeply, focus more acutely. What can be done to help women of all races/ethnicities? A good start is to design a stronger defined contribution plan, implement auto features at greater levels, understand the employee base, and create effective, customized communication. These actions will drive women of all races/ethnicities forward to a more equal retirement footing with men.","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"9 1","pages":"104 - 107"},"PeriodicalIF":0.0,"publicationDate":"2022-03-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44872735","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The Retirement Confidence Survey (RCS) was conducted for its 31st year in 2021 to measure attitudes of American workers and retirees about issues surrounding retirement. The 2021 RCS included an oversample of Black and Hispanic Americans to allow for a closer analysis of the challenges they face in saving and preparing for retirement. This oversample allowed controlling for the disproportionately lower financial resources of Black and Hispanic Americans when examining their attitudes toward and preparations for retirement. Several important results emerged, including the need for more access to workplace retirement saving plans that provide one-on-one, personalized advice that builds on Black and Hispanic Americans’ comfort with having a connection to those providing them advice. In addition, financial service companies having more people who are similar to Black and Hispanic Americans and treating them fairly could improve their use of the financial system. A greater understanding of the importance of supporting family and friends that in particular Hispanic Americans feel when making financial decisions is needed, so that this obligation can be weighed against their own savings to build wealth that could result in a lesser need for supporting family members in the future. Obviously, higher incomes would help, but these issues arise even for those with higher incomes.
{"title":"Black and Hispanic American Findings from the 2021 Retirement Confidence Survey","authors":"C. Copeland, L. Greenwald","doi":"10.3905/jor.2022.1.110","DOIUrl":"https://doi.org/10.3905/jor.2022.1.110","url":null,"abstract":"The Retirement Confidence Survey (RCS) was conducted for its 31st year in 2021 to measure attitudes of American workers and retirees about issues surrounding retirement. The 2021 RCS included an oversample of Black and Hispanic Americans to allow for a closer analysis of the challenges they face in saving and preparing for retirement. This oversample allowed controlling for the disproportionately lower financial resources of Black and Hispanic Americans when examining their attitudes toward and preparations for retirement. Several important results emerged, including the need for more access to workplace retirement saving plans that provide one-on-one, personalized advice that builds on Black and Hispanic Americans’ comfort with having a connection to those providing them advice. In addition, financial service companies having more people who are similar to Black and Hispanic Americans and treating them fairly could improve their use of the financial system. A greater understanding of the importance of supporting family and friends that in particular Hispanic Americans feel when making financial decisions is needed, so that this obligation can be weighed against their own savings to build wealth that could result in a lesser need for supporting family members in the future. Obviously, higher incomes would help, but these issues arise even for those with higher incomes.","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"9 1","pages":"91 - 103"},"PeriodicalIF":0.0,"publicationDate":"2022-03-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44059299","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The objective of this article is to explore the selection and rebalancing of mutual funds in the portfolio of individual retirement investors to enable their portfolios to outperform market indexes. Three interesting facts emerged from this analysis: (1) momentum strategy is better when rebalancing is done in shorter intervals; (2) momentum strategy works better for longer investment horizons; and (3) momentum strategy is better when funds are more broadly diversified. Analysis of the results indicates that retirees using the momentum strategy over long horizons can earn significant excess returns compared to those of the Standard and Poor’s (S&P) 500 index. The results suggest that if crafted carefully, a momentum strategy can help retirees improve the performance of their retirement portfolio over a traditional diversification strategy.
{"title":"Can a Momentum Strategy Outperform the S&P 500 Index in a Retirement Plan?","authors":"A. Lodgher, Syed M. Harun","doi":"10.3905/jor.2022.1.108","DOIUrl":"https://doi.org/10.3905/jor.2022.1.108","url":null,"abstract":"The objective of this article is to explore the selection and rebalancing of mutual funds in the portfolio of individual retirement investors to enable their portfolios to outperform market indexes. Three interesting facts emerged from this analysis: (1) momentum strategy is better when rebalancing is done in shorter intervals; (2) momentum strategy works better for longer investment horizons; and (3) momentum strategy is better when funds are more broadly diversified. Analysis of the results indicates that retirees using the momentum strategy over long horizons can earn significant excess returns compared to those of the Standard and Poor’s (S&P) 500 index. The results suggest that if crafted carefully, a momentum strategy can help retirees improve the performance of their retirement portfolio over a traditional diversification strategy.","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"10 1","pages":"28 - 47"},"PeriodicalIF":0.0,"publicationDate":"2022-03-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46064223","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article explores how gender representation has varied among defined contribution plan administrators from 2000 to 2017 and the relation between gender and some potential measures of plan quality. We find that there has been a significant increase in gender diversity among defined contribution plan administrators, where approximately 30% of plan administrators were female in 2000, increasing to approximately 50% in 2017. We also find that plans run by female administrators have attributes that would widely be considered “better” than those run by male administrators, because they were more likely to exhibit better plan governance attributes, more likely to automatically enroll participants, and more likely to offer target-date funds.
{"title":"Gender Diversity among Defined Contribution Plan Administrators and the Potential Impact on Retirement Outcomes","authors":"David Blanchett, J. Varga, Chris Weirath","doi":"10.3905/jor.2022.1.107","DOIUrl":"https://doi.org/10.3905/jor.2022.1.107","url":null,"abstract":"This article explores how gender representation has varied among defined contribution plan administrators from 2000 to 2017 and the relation between gender and some potential measures of plan quality. We find that there has been a significant increase in gender diversity among defined contribution plan administrators, where approximately 30% of plan administrators were female in 2000, increasing to approximately 50% in 2017. We also find that plans run by female administrators have attributes that would widely be considered “better” than those run by male administrators, because they were more likely to exhibit better plan governance attributes, more likely to automatically enroll participants, and more likely to offer target-date funds.","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"9 1","pages":"61 - 72"},"PeriodicalIF":0.0,"publicationDate":"2022-03-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49134583","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article leverages the Employee Benefit Research Institute’s (EBRI) HSA Database to examine the ways in which HSA usage varies by race, ethnicity, gender, and income. The author finds significant disparities across racial lines. White accountholders made larger contributions and had larger balances than their Black counterparts. Similarly, male accountholders made larger contributions and had higher average balances than female accountholders. This pattern extended to higher-income accountholders relative to lower-income accountholders. To the extent that HSAs are not used properly, they may reinforce existing health inequities.
{"title":"Analyzing the Intersection of HSAs and Race, Ethnicity, Gender, and Income","authors":"Jake Spiegel","doi":"10.3905/jor.2022.1.106","DOIUrl":"https://doi.org/10.3905/jor.2022.1.106","url":null,"abstract":"This article leverages the Employee Benefit Research Institute’s (EBRI) HSA Database to examine the ways in which HSA usage varies by race, ethnicity, gender, and income. The author finds significant disparities across racial lines. White accountholders made larger contributions and had larger balances than their Black counterparts. Similarly, male accountholders made larger contributions and had higher average balances than female accountholders. This pattern extended to higher-income accountholders relative to lower-income accountholders. To the extent that HSAs are not used properly, they may reinforce existing health inequities.","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"9 1","pages":"47 - 60"},"PeriodicalIF":0.0,"publicationDate":"2022-03-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45996968","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article demonstrates that although working longer can, in theory, substantially improve financial preparedness for retirement, it yields much smaller improvements in practice. Multivariate analysis using data from the Health and Retirement Study reveals that working longer improves financial preparedness only for workers who also delay claiming Social Security. But most older workers combine work with Social Security benefits, do not increase their financial wealth, and miss out on the delayed retirement credit. For many, early claiming is a rational choice because their low and often part-time earnings fall short of projected post-retirement income.
{"title":"The Illusory Benefit of Working Longer on Retirement Financial Preparedness: Rethinking Advice That Working Longer Increases Retirement Income","authors":"T. Ghilarducci, M. Papadopoulos, A. Webb","doi":"10.3905/jor.2022.1.104","DOIUrl":"https://doi.org/10.3905/jor.2022.1.104","url":null,"abstract":"This article demonstrates that although working longer can, in theory, substantially improve financial preparedness for retirement, it yields much smaller improvements in practice. Multivariate analysis using data from the Health and Retirement Study reveals that working longer improves financial preparedness only for workers who also delay claiming Social Security. But most older workers combine work with Social Security benefits, do not increase their financial wealth, and miss out on the delayed retirement credit. For many, early claiming is a rational choice because their low and often part-time earnings fall short of projected post-retirement income.","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"10 1","pages":"7 - 27"},"PeriodicalIF":0.0,"publicationDate":"2022-02-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49094949","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"GUEST COLUMN: Ongoing Collaboration and Discussion Crucial to Moving the Needle on Retirement Savings","authors":"Warren Cormier","doi":"10.3905/jor.2022.1.103","DOIUrl":"https://doi.org/10.3905/jor.2022.1.103","url":null,"abstract":"","PeriodicalId":36429,"journal":{"name":"Journal of Retirement","volume":"9 1","pages":"7 - 8"},"PeriodicalIF":0.0,"publicationDate":"2022-01-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46643857","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
京公网安备 11010802042870号
京ICP备2023020795号-1
扫码关注我们
求助内容：
应助结果提醒方式：