We investigate optimal investment and drawdown decisions in retirement, and show that the asset mix and drawdown strategy vary significantly with financial circumstances and preferences. Loss aversion preferences lead to hedging strategies to secure the target consumption through use of...

This article sets out principles and decision rules for setting appropriate drawdown and investment strategies during retirement given an individual’s objectives and risk tolerance. In particular, we highlight how the suitable drawdown strategy can relate to the objective, and how annuities...

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...

This paper considers an alternative way of structuring stochastic variables in a dynamic programming framework where the model structure dictates that numerical methods of solution are necessary. Rather than estimating integrals within a Bellman equation using quadrature nodes, we use nodes...

Defined Contribution superannuation plans require fund members to make several decisions requiring a high level of financial expertise and participation. Most members do not have the expertise to make such decisions. Hence, the onus falls on fund providers to offer default products that make the...

This paper considers an alternative way of structuring stochastic variables in a dynamic programming framework where the model structure dictates that numerical methods of solution are necessary. Rather than estimating integrals within a Bellman equation using quadrature nodes, we use nodes...

For a retiree who must maintain both investment and longevity risks, we consider the impact on decision making of focusing on an objective relating to the terminal wealth at retirement, instead of a more correct objective relating to a retirement income. Both a shortfall and a utility objective...