Primer on Retirement Income Strategy Design and Evaluation
Authors
Adam Butt, PhD, FIAA
Guarav Khemka, PhD, FIAA, CERA
William Lim, AIAA
Geoff Warren, PhD
Research School of Finance, Actuarial Studies and Statistics
Australian National University
Description
The SOA Research Institute is pleased to make available material for Primer on Retirement Income Strategy Design and Evaluation. This 'handbook' covers a wide range of aspects around retirement income strategies including: member attributes that matter; types of income objectives; nature of income risk; approaches to investing and drawing down on available assets; stochastic modelling; and the use of utility and metrics to characterize outcomes and identify a suitable retirement strategy. The analysis is supported by excel models that are available to download. The Primer is based around the idea of three types of income objectives – an income floor, income target and income optimization – and shows how this framing flows into both strategy selection and evaluation with each objective calling for different strategies and a different set of metrics.
Materials
Primer on Retirement Income Strategy Design and Evaluation
Income Target Objective Model
Income Optimization Objective Model
Thank You
The SOA Research Institute’s Aging and Retirement Strategic Research Program would like to thank the following individuals for their input throughout this project:
R. Evan Inglis (Chair), FSA, MAAA, EA, FCA
Adrian Cox, FSA, MAAA
David Cantor, ASA, EA
Faisal Siddiqi, FSA, FCIA
Jeffery Rykhus, FSA, MAAA
Jing Fritz, FSA, MAAA, CERA
Joseph Goodman, FSA, MAAA, CERA
Kailan Shang, FSA, ACIA
Larry Pollack, FSA, MAAA, EA, FCA
Paula Hogan, CFP, CFA
Ruth Schau, FSA, EA, FCA
Barbara Scott, Senior Research Administrator
Steven C. Siegel, Senior Practice Research Actuary
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