Successful Defined Contribution Investment Design : How to Align Target-Date, Core, and Income Strategies to the PRICE of Retirement.

Intro -- Successful Defined Contribution Investment Design -- Disclosure -- Contents -- Acknowledgments -- Introduction -- How This Book Is Organized-and How to Use It -- A Continuing Commitment to Meet the Need for Information -- Why Should You Read This Book? -- Part One DC Plans: A Cornerstone of Retirement -- Chapter 1 DC Plans Today: An Overview of the Issues -- Preface: A Career and a New Form of Pension Plan Are Born -- DC Plans: Becoming the New Reality . . . No Turning Back -- Setting Goals for Success: Income Replacement Targets -- Reducing DC Litigation Risk: Process and Oversight -- Who's a Fiduciary? -- How to Approach Outsourcing DC Plan Resources -- Hiring an Investment Consultant -- Getting Started: Setting an Investment Philosophy and Governance Structure -- Establish Global Philosophy and Guiding Principles -- Set Retirement Plan Objectives and Design -- Create Governance Oversight Structure -- Formulate Objective Measures of Success -- Outline Implementation Considerations -- PIMCO Principles for DC Plan Success: Building and Preserving Purchasing Power -- Maximizing DC Savings: Just Do It! -- In Closing -- Questions for Plan Fiduciaries -- Chapter 2 Aligning DC Investment Design to Meet the PRICE of Retirement -- Begin with the End in Mind -- What Is a Reasonable Pay Replacement Target? -- Calculating the Income Replacement Rates -- Historic Cost of Retirement: PRICE Is a Moving Target -- A Focus on Income, Not Cost -- PRICE-Aware: Applying PRICE to Consider DC Assets and Target-Date Strategies -- Evaluating Glide Paths -- Tracking DC Account Balance Growth Relative to PRICE -- Summary: The Importance of Knowing Your PRICE -- In Closing -- Questions for Plan Fiduciaries -- Note -- Chapter 3 Plan Investment Structure -- Tiers and Blends: Investment Choices for DC Participants.

Tier I: "Do-It-for-Me" Asset Allocation Investment Strategies -- Target-Date Strategies -- Balanced or Target-Risk Strategies -- Managed Accounts -- Tier II: "Help-Me-Do-It" Stand-Alone or "Core" Investment Options -- DC Plan Investment Choices: Farewell to Company Stock? -- Reduce Company Stock Exposure with "Sell More Tomorrow" -- Evolution of Investment Menu Design -- Active versus Passive Approaches: DC Consultants' Views -- Active versus Passive: Reduced or Heightened Litigation Risk? -- Investment Structure: Mutual Fund, Collective Investment Trust, or Separately Managed Account -- Understand Revenue Sharing: Consider Paying Administration and Other Plan Fees -- Blended Multimanager or White-Label Investment Options -- Tier III: "Do-It-Myself" Mutual-Fund-Only or Full Brokerage Window -- Considering an Outsourced Chief Investment Officer -- Considering an Outsourced Chief Investment Officer -- In Closing -- Questions for Plan Fiduciaries -- Notes -- Chapter 4 Target-Date Designand Approaches -- Target-Date Structures vary By plan Size -- Custom Target-Date Strategies -- Semicustom Target-Date -- Packaged Target-Date -- Target-Date Selection and Evaluation Criteria -- No Such Thing as Passive -- Low Cost and Low Tracking Error Does Not Equal Low Risk -- Framework for Selecting and Evaluating Target-Date Strategies: Three Active Decisions Plan Sponsors Must Make -- Active Decision #1: How Much Risk Can Plan Participants Take? -- Human Capital May Not Be Sufficient: Understanding Risk Capacity versus Risk Tolerance -- Active Decision #2: How Is the Risk Best Allocated across Investment Choices? -- Active Decision #3: Should Risk Be Actively Hedged? -- Tail-Risk Hedging Strategies -- Insurance -- Target-Date Analytics: Glide Path Analyzer (GPA) and Other Tools -- Global DC Plans: Similar Destinations, Distinctly Different Paths -- In Closing.

Questions for Plan Fiduciaries -- Notes -- Part Two Building Robust Plans: Core Investment Offerings -- Chapter 5 Capital Preservation Strategies -- Capital Preservation: Importance -- Capital Preservation: What Is Prevalent and What Is Preferred? -- The 1 NAV : Shared by Stable Value and MMFs -- Stable Value Offers More Opportunity in a Low-Interest-Rate Environment -- Looking Forward: The Changing Role of Stable Value -- Making Low-Risk Decisions: Views from the Field -- White Labeling: A Capital Preservation Solution -- An Analytic Evaluation of Capital Preservation Solutions -- Short-Term, Low-Duration, and Low-Risk Bond Strategies -- Inclusion of Stable Value in Custom Target-Date or Other Blended Strategies -- In Closing -- Questions for Plan Fiduciaries -- Note -- Chapter 6 Fixed-Income Strategies -- What Are Bonds, and Why Are They Important for Retirement Investors? -- What Are the Different Types of Bonds in the Market? -- What Types of Bonds Should Be Offered to DC Participants? -- Capital Preservation -- Core and Core-Plus Bonds -- Investment-Grade and High-Yield Credit -- Multisector -- Foreign/Global -- Bond Investment Strategies: Passive versus Active Approaches -- Bonds Unleashed -- Analytic Evaluation: Comparing Bond Strategies -- Fixed Income within Target-Date Glide Paths -- Observations for Fixed Income Allocation within Target-Date Strategies -- In Closing -- Questions for Plan Fiduciaries -- Chapter 7 Designing Balanced DC Menus: Considering Equity Options -- What Are Equities and How Are They Presented in DC Investment Menus? -- Getting the Most out of Equities -- Consider Dividend-Paying Stocks -- Evaluating Equity Strategies -- Less Is More: Streamlining Equity Choices -- Shift to Asset-Class Menu May Improve Retirement Outcomes -- Active versus Passive-The Ongoing Debate.

Strategic Beta: Consider Adding Fundamentally Weighted Equity Exposure -- Currency Hedging: An active Decision -- Observations for Equity Allocations within Target-Date Strategies -- In Closing -- Questions for Fiduciaries -- Note -- Chapter 8 Inflation Protection -- What Is Inflation and How Is It Measured? -- Why Inflation Protection in DC? -- History of Inflation: Inflation Spikes Underscore Need for Inflation-Hedging Assets -- Inflation Protection When Accumulating and Decumulating, and in Different Economic Environments -- Economic Environments Change Unexpectedly-and Reward or Punish Various Asset Classes -- Consultants Favor TIPS, Multi-Real-Asset Strategies, REITs, and Commodities -- How Should Plan Sponsors Address Inflationrisk In DC Portfolios? -- Implementation Challenges -- Evaluating Real Asset Strategies -- Summary Comparison of Individual and Multi-Real-Asset Blends -- Inflation-Hedging Assets in Target-Date Glide Paths -- Observations for Inflation-Hedging Assets in Target-Date Glide Paths -- In Closing -- Questions for Fiduciaries -- Chapter 9 Additional Strategies and Alternatives: Seeking Diversification and Return -- What Are Alternative Assets? -- A Wider Lens on Alternatives -- Consultant Support for Additional Strategies and Alternatives -- Back to Basics: Why Consider alternatives? -- Liquid Alternatives: Types and Selection Considerations -- Important Characteristics in Selecting Alternatives: Consultant Views -- Illiquid Alternatives: Types and Considerations -- Contrasting Liquid Alternative Strategies with Hedge Fund and Private Equity Investments -- In Closing -- Questions for Plan Fiduciaries -- Part Three Bringing It All Together: Creating Retirement Income -- Chapter 10 Retirement Income: Considering Options for Plan Sponsors and Retirees -- Advisor and Consultant Retirement Income Suggestions.

Why Don't Retirees Leave Their Assets in DC Plans at Retirement? -- Retaining a Relationship with Your Employer Inretirement: An Innovative and Caring Plan Sponsor -- Mutual Benefits: Retaining Retiree Assets May Help Both Retirees and Plan Sponsors -- Turning DC Assets into a Lifetime Paycheck: Evaluating the DC Investment Lineup for Retiree Readiness -- Evaluating Portfolio Longevity -- Turning Defined Contribution Assets into a Lifetime Income Stream: How to Evaluate Investment Choices for Retirees -- Guarding Retiree Assets against a Sudden Market Downturn: Sequencing Risk -- Ways to Manage Market and Longevity Risk . . . without Adding In-Plan Insurance Products -- Living beyond 100: Planning for Longevity -- Managing Longevity Risk: Considerations for Buying an Annuity -- Immediate and Deferred Annuities: Why Out-of-Plan Makes Sense -- In Closing -- Questions for Plan Fiduciaries -- Notes -- Chapter 11 A Global View: The Best Ideas from around the Globe for Improving Plan Design -- DC Plans: Becoming the Dominant Global Model -- Retirement Plan Coverage and Participation -- Investment Default and Growth of Target-Date Strategies -- Retirement Income: The Global Search for Solutions -- Defined Ambition in the Netherlands -- New Solutions in Australia and Beyond: Tontines and Group Self-Annuitization -- "Getting DC Right": Lessons Learned in Chapters 1 through 10 -- Chapter 1: DC Plans Today -- Chapter 2: Aligning DC Investment Design to Meet the PRICE of Retirement -- Chapter 3: Plan Investment Structure -- Chapter 4: Target Date Design and Approaches -- Chapter 5: Capital Preservation Strategies -- Chapter 6: Fixed Income Strategies -- Chapter 7: Designing Balanced DC Menus: Considering Equity Options -- Chapter 8: Inflation Protection -- Chapter 9: Additional Strategies and Alternatives: Seeking Diversification and Return.

Chapter 10: Retirement Income: Considering Options for Plan Sponsors and Retirees.

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Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2024. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.