The shift from defined benefit (DB) to defined contribution (DC) is pervasive among pension funds, due to demographic changes and macroeconomic pressures. In DB all risks are borne by the provider, while in plain vanilla DC all risks are borne by the beneficiary. For DC to provide income...

Defined contribution (DC) or money purchase pension saving schemes place the onus on participants to make decisions on asset allocation, the choice of investment vehicles, and the extent to which changes in individual circumstances and macroeconomic conditions should affect investment strategy....

Defined-benefit (DB) pension funds, which are often underfunded, rely on the legal obligation of their sponsor to secure pension rights. This paper is the first to solve the optimal portfolio choice problem of pension funds taking into account the risk on the sponsor's guarantee, and we show...

We evaluate the impact of Financial Accounting Standard 132 by measuring how well its required asset allocation information predicts next year's pension returns. We compare the predictive capability of several different models, including Sharpe's style model and survey data by Pensions &...

Studying the age-dimension of the probability distribution of pensions while assuming steadily rising real wages and time-invariant benefit-rules, two factors play important roles: (i) the weight of the wages in indexation of benefits in progress; (ii) the longevity gap. Factor (i) acts against...

Public pay-as-you-go pensions still form the dominant pillar of old-age provision in Germany. This is in marked contrast to the situation in Anglo-Saxon countries. It has advantages if labour markets are strong, e.g., following a quick recovery from the Great Recession. It has disadvantages, as...

There exists a wide variety of tax treatments of pensions across the world. And the reasons for such a range of regimes are not clear. This note reviews the general principles of pension taxes and analyses the theoretical foundations of why pension incomes ought to be taxed specifically. To do...

There exists a wide variety of tax treatments of pensions across the world. And the reasons for such a range of regimes are not clear. This note reviews the general principles of pension taxes and analyses the theoretical foundations of why pension incomes ought to be taxed specifically. To do...

Delaying Social Security claiming is equivalent to buying an annuity, as individuals who delay forgo current benefits in exchange for higher monthly benefits in the future. Despite growing evidence that this annuity is offered on extremely generous terms, the majority of people claim well before...

About 5 million state and local government workers, including 1.2 million public school teachers concentrated in 15 states, are not enrolled in Social Security. In order to ensure that those workers receive adequate benefits, Congress requires state and local government employers to offer...