To establish current savings behavior, one necessary measurement of retirement preparation is identifying the percentage of workers with employment-based retirement plans, as well as understanding the characteristics of workers with and without access to such programs. The findings from this...

Assuming the loss aversion framework of Tversky and Kahneman (1992), stochastic investment and labour income processes, and a path-dependent fund target, we show that the optimal investment strategy for defined contribution pension plan members is a target-driven ‘threshold' strategy, whereby...

This paper assesses the level of sophistication evident in investment choices of a large sample of individuals drawn from three Australian retirement savings funds. Available US and UK evidence is somewhat mixed on both the measures that should be used when measuring the sophistication as well...

To establish existing savings behavior, it is necessary to estimate the percentage of workers with an employment-based retirement plan, and to know the characteristics of workers with and without a plan - the subject of this paper. The findings show that there has been a significant increase in...

This article calls attention to the Department of Labor's imposition of the “prudent investor rule” on financial advisers to retirement savers. The article also canvasses the customary role of an investment policy statement in promoting compliance with the prudent investor rule by...

A defined contribution pension plan allows consumption to be redistributed from the plan member's working life to retirement in a manner that is consistent with the member's personal preferences. The plan's optimal funding and investment strategies therefore depend on the desired profile of...

This paper explores (1) whether plan demographic characteristics would affect individual participant contribution rates and target-date fund investments and (2) equity glide paths for participants in relation to plan demographics by considering target replacement income and its success rate....

Target-date funds (TDFs) are an important and growing investment option in 401(k) retirement plans, and are giving rise to a new class of 401(k) investor: “mixed” target-date fund users who hold the funds in combination with other non-TDF funds in the plan menu. Although “pure” TDF users...

This paper examines the retirement savings investment choices of Australian workers over a three year period, including the global financial crisis (GFC). The analysis is based on a large sample of 3.6 million members drawn from five superannuation funds with assets of $74 billion. Australian...