This paper analyzes the effects of tax-deferred accounts (TDAs) in a stochastic life-cycle model. The simulations reveal that conventional savings (CSAs) serve mainly for liquidity and TDAs for retirement and bequests. The tax incentives are generally effective in stimulating new savings for the...

This paper derives optimal equity-bond-annuity asset portfolios for households in the retirement phase who, with or without a bequest motive, face stochastic capital market returns, have differential exposures to mortality risk and uncertain uninsured health expenses, and have differential...

This study quantifies the possible consequences to stakeholders of reforms to the excise tax on reversions of excess pension assets. Under the U.S. Pension Protection Act of 2006 (PPA), funding in defined benefit plans is likely to improve significantly. Many plans may become overfunded over...