This book presents a consistent and complete framework for studying the risk management of a pension fund. It gives the reader the opportunity to understand, replicate and widen the analysis. To this aim, the book provides all the tools for computing the optimal asset allocation in a dynamic framework where the financial horizon is stochastic (longevity risk) and the investor's wealth is not self-financed. This tutorial enables the reader to replicate all the results presented. The R codes are provided alongside the presentation of the theoretical framework. The book explains and discusses the problem of hedging longevity risk even in an incomplete market, though strong theoretical results about an incomplete framework are still lacking and the problem is still being discussed in most recent literature.

Written for first-time buyers who have never owned a property or had a mortgage, rather than buy-to-let investors. Provides a holistic view of the property purchase process, and examines several key aspects: property, mortgages, and legal considerations. Written by academics who have extensive practical experience in property and mortgages.

The Political Economy of Pension Financialisation addresses - for numerous countries - how and why pension reforms have come to rely more on financial markets, how public policy reacted to financial crises, and regulatory variation. The book demonstrates how the process of pension financialisation reveals that pension policy is not only a social policy that affects retirement income, but also a financial policy that impacts savings rates, corporate finance and the economy. The chapters shed light on pre-funded private pensions as one key component of financialisation, as they turn savings into investments via financial services providers. Readers will also see how pension financialisation and the broader financialisation of the economy are here to stay, despite negative developments during and after the financial crisis. A systematic and comparative overwiew of the financialisation of pensions, The Political Economy of Pension Financialisation is ideal for scholars and postgradues working on Political Economy, Public Policy and Finance. This book was originally published as a special issue of the Journal of European Public Policy.

"Fiduciary Management"

"Dr. van Nunen goes much further than to discuss governance. He discusses all aspects of what should be done in making a defined benefit plan successful, and expresses his views forthrightly. And he not only traces the history of pension arrangements, but supplements it with a fascinating chapter comparing arrangements around what I think of as the funded world. His ideas are relevant to fiduciaries around the funded world ... I hope you find his book as interesting, engaging, and useful as I did."
--From the Foreword by Don Ezra, Director of Investment Strategy, Russell Investment Group, and coauthor of Pension Fund Excellence

"Many pension funds are too small to ever become cost-effective pension delivery organizations. This book offers a solution to the serious 'too small' problem."
--Keith Ambachtsheer, Director of the Rotman International Centre for Pension Management, University of Toronto, founder of KPA Advisory Services Ltd., and author of Pension Revolution

"The topic of fiduciary management is now at the leading edge of assets and pensions management, which makes this book extremely timely. It manages to distill a wealth of practice and experience into a short and lucid discussion of the topic. A particular pleasure is that it avoids the trap of pages of obscure and usually irrelevant mathematics. For the many not following into this field, this is a 'must read.'"
--Con Keating, principal of The Finance Development Centre Ltd., London

"As is readily apparent from this book, Dr. van Nunen has thought long and hard about fiduciarymanagement and is one of the world's leading experts. He comprehensively describes how fiduciarymanagement can improve plan governance, particularly as it relates to manager selection and the management of surplus risk. The book does an excellent job explaining how fiduciary management provides a robust framework and clear separation of duties for investment committee members trying to navigate an increasingly complex investment landscape."
--Bob Litterman, Managing Director and Head of Goldman Sachs Asset Management's Quantitative Resources Group, and author of Modern Investment Management: An Equilibrium Approach

"I found the book an interesting, engaging, and stimulating read. Fiduciary management is a very timely topic and is especially relevant for smaller pension plans that may lack in-house expertise. Such plans would benefit from outside help. The book covers a lot of ground. Dr. van Nunen shares with us his valuable insights and experience in his discussion of the pitfalls and complexities of asset management. Anyone who manages a defined benefit pension plan can benefit from reading this book."
--Josef Lakonishok, CEO and CIO of LSV Asset Management

Understanding the ways in which people save for their retirement is an urgent issue. So much has changed in the last 10 to 15 years, especially in the area of the provision of pensions and retirement income. Around the world, greater and greater responsibility is being allocated to individuals while governments discount their contributions to social security and employers retreat from the provision of supplementary retirement income.
This book explores the behavioral revolution and its implications for understanding financial decision-making and saving for the future. Recognizing the profound implications of this research program, it goes beyond issues of risk aversion, framing, and decision-making to consider how social identity and the resources due to people by virtue of their place in society figure in savings behavior. It gives considerable attention to the context of the environment in which people make financial decisions, arguing that this allows a better understanding of the coexistence of sophistication and naivety apparent in patterns of retirement saving.
Utilizing databases from the UK, the book provides an empirical foundation to its theoretical arguments, demonstrating how an integrated approach to individual financial decision-making is necessary if we are to address the apparent shortfall in many people's planning for the future. The book concludes by setting the agenda for the design, governance, and regulation of pension savings schemes consistent with delivering cost-effective solutions to pension adequacy. In these ways, it sets forth a strategy for rethinking individual behavior as well as the design of retirement income systems.

Interest in longevity and longevity risk management is burgeoning, as government and regulatory agencies are increasingly conscious of the potential risks and benefits of longer lifespans. Commercial and industrial organizations, especially within the financial sector, are awakening to the opportunities presented by population aging, along with the new array of financial insurance instruments to manage longevity risk, which more sophisticated markets are making possible. This volume explores three main themes: the need for products to manage longevity risk; the structure and safety of financial products on the market that help manage longevity risk; and the role of policy in stimulating and strengthening longevity insurance products.
This edited volume brings together leading international experts to evaluate the challenge posed by trends in longevity risk and draws out the implications and constraints of this new reality for insurance companies and annuity providers. It discusses both emerging economies (India, Chile) and many of the older nations (Sweden, Canada, the US, Australia, Japan, the UK and Switzerland). It aims to instigate new thinking among retirement planners, plan sponsors, academics, and industry leaders seeking to manage retirement payouts and longevity risk.

This authoritative collection, which includes a new introduction surveying the fields, contains key contributions from the comparative literature on the politics of income maintenance policy.In recent years theoretical work has been dominated by Gosta Esping-Andersen's regime theory. This volume demonstrates how that theory, together with arguments on convergence and path-dependency, has been applied to the comparative study of income maintenance policy. It highlights issues about the difference between social insurance and social assistance and about the important differences in the way women and families are treated. The collection looks at the literature that seeks to explain cutbacks, or their absence, highlighting issues about pensions policy. Income Maintenance Policy will be an invaluable source of literature for researchers, students and policymakers alike.

The global custody product was conceived out of changes to United States pension law. In 1974, the Employee Retirement Income Security Act came to the Statute books, forcing US pension plan sponsors to segregate investment management and custody of the underlying assets.
Today, service providers act for clients in many countries worldwide, handling assets across 100 countries of investment. The range of services is ever more sophisticated. Measured by the value of assets held under custody, it is a multi trillion dollar industry.

This first major book on Public-Private Partnerships (PPP) in Nigeria explores the legal, policy and strategic issues involved in the structuring and execution of PPP projects in Nigeria. The book goes beyond the toolkit approach of other available resources to blend the theoretical analysis of concepts with practical step-by-step guides for consummating projects. The book adopts a multidisciplinary approach by integrating law, economics, finance and project management literature, relying on the author's extensive experience in the field to give clear insights on the PPP concept. The case study methodology employed in the book produces rich and compelling empirical results. This book is suitable for beginners wishing to develop an understanding of the concept, as well as practitioners advising on PPPs. Students and academics wishing to carry out further research on PPPs will also benefit from the book.

Economic Restructuring and Social Exclusion provides a timely reminder of persisting inequalities of class, race and gender as a consequence of the changes which have engulfed Europe in less than a decade. The contributors consider key debates including democracy, social justice and citizenship. The book also examines evidence that social and economic polarization is increasing, and the prospect of a conspicuous and growing "underclass" in Europe's urban centres is fast becoming a reality. This volume will be particularly valuable for undergraduate and postgraduate students in sociology.

"This is a landmark book on pension fund management. All those with a stake in building pension wealth will profit from this commonsense and clearly readable guide to improved pension fund performance." —Burton G. Malkiel author of A Random Walk Down Wall Street and Chemical Bank Chairman's Professor of Economics, Princeton University.

"This is not just another book of theory about how pension funds should be managed, or about how one expert thinks an appropriate asset allocation should be determined. . . . There is keen analysis by Messrs. Ambachtsheer and Ezra, both of whom are veteran pension consultants noted for thinking outside the box." —Michael J. Clowes, Editorial Director Pensions & Investments.

"Keith Ambachtsheer and Don Ezra, two leading consultants, have written the most comprehensive handbook ever published on pension fund management. It's must reading for all those in a fiduciary role." —W. Allen Reed, President General Motors Investment Management Corp.

"Don Ezra and Keith Ambachtsheer are two of the best thinkers in the world of pension fund management. All who care about retirement assets will learn valuable lessons from their new book." —Charles D. Ellis, Managing Partner Greenwich Associates.

". . . powerful, authoritative, and provocative critique of a subject that concerns all of us . . ." —Peter L. Bernstein, President Peter L. Bernstein, Inc. author of Against the Gods: The Remarkable Story of Risk.

No longer obscure investment vehicles, pension funds have stepped out of the shadows and into the global spotlight. More and more, they are being seen as special financial institutions that need to create value for their millions of members and employers around the world. With assets close to $12 trillion—$7 trillion in the United States alone—pension funds are dominant players in financial markets and in corporate governance.

Yet they continue to be misunderstood and are often poorly managed. As advisors to many of the world's premier pension funds, Keith P. Ambachtsheer and D. Don Ezra have an international reputation as experts in the field. Now, their combined talents and experience yield a timely and thorough book on effective pension fund management. Pension Fund Excellence presents a guiding paradigm for articulating a fund's mission and for what needs to be done to accomplish it.

Along the way, the authors provide new insights on fundamental issues. What key elements integrate pension fund governance, management, and operations? What decision structure does an excellent pension fund organization use? What do the best decision-makers know about fiduciary responsibilities, pension economics, and the markets for financial capital and investment management services? What policies do they adopt? How do they measure results and tie results to compensation? How should small funds face their special challenges?

Their advice is made practical through real-world case studies that focus on the best practices employed by the world's premier pension funds. Their clear focus is on creating value for stakeholders.

Finally, Pension Fund Excellence looks beyond today, offering the authors' incisive views on three critical pension issues for the twenty-first century: the rise of defined contribution plans, fixing "broke" national social security schemes, and the growing economic power of pension funds.

Written by two leading authorities, Pension Fund Excellence contains the most up-to-date, insightful, practical information and advice available on this now hot topic. It is must reading for anyone seeking effective, proven management principles and techniques to create value for pension fund stakeholders.

This book provides a secure grounding in the theory and practice of finance insofar as it deals with pension matters. By using it, the reader will understand the various types of investment assets;
* the allocation of personal wealth to different asset classes
* corporate pension finance
* the financial aspects of defined contribution pension plans during both the accumulation and distribution phases
* the financial aspects of defined benefit pension plans
* the role of pension funds and pension fund management
* pension fund performance measurement and attribution
* risk management in pension funds

Pension Systems enters into the current lively debate on European pensions. The focus of the book is the analysis of public intervention in individuals' retirement choice, its rationale and the desirability of legislation introducing a sizeable and compulsory increase in retirement age, to face the prospects of swift population ageing. The book assesses the impact of different retirement rules on individual decisions, on the sustainability of social security systems and on labour market dynamics, and inquires whether mandatory retirement has not become an outdated feature of modern pension systems. The motivations behind public intervention in fixing compulsory retirement rules as well as the likely consequences of allowing the individual a higher responsibility in retirement choices are analysed. These issues are examined both theoretically and empirically and through a focus on country-specific patterns of retirement and on policy issues relevant at the European level. The impact of later retirement on the labour market is also investigated, considering the role of retirement rules in increasing employment. This comprehensive and topical book will appeal to academics and scholars of public finance as well as pensions experts and organisations.

This book argues that the implementation of compulsory, highly regulated, privately administered, defined contribution pensions facilitates rent-seeking behaviour on the part of the pension fund administrators and undermines the retirees' income and well-being. While the book focuses primarily on Chile, its analysis and conclusions are applicable to several Latin American and Eastern European countries where privately administered pension systems have been implemented. Chapters evaluate the scholarly literature and empirical evidence around three aspects of the pension fund industry: structure, pricing and performance. The authors conclude that state regulation has facilitated the accumulation of capital in the hands of the pension fund administrators. They also demonstrate that these systems owe more to the values and principles of conservative philosophy than to neoliberalism in providing alternative solutions to the rent-seeking approach to retirement.

Population ageing and the resulting pressures on existing pension systems constitutes one of the most important challenges modern societies will have to face over the coming decades. Although governments have responded to such pressures by adopting a plethora of pension reforms, the adaptation process is far from over. This book comprehensively documents developments in pension policy in eleven advanced industrial countries in Western Europe, East Asia and North America. In order to explore what population ageing means for the sustainability of pension systems, the authors present a detailed review of pension policy making over the past two decades and provide up-to-date analysis of current pension legislation. They examine the factors that can facilitate or impede the adaptation of pension systems and the features that shape and determine reforms. They also highlight the fact that although the path of reform taken by each country is somewhat different, the processes at work are often very similar. Ageing populations throughout the world are extremely reluctant to see their pension systems dismantled and are therefore prepared to mobilise in their defence. This process of mobilisation interacts with demographic pressures and institutional constraints to help determine the future direction of pension policy. The breadth of geographic coverage provides an almost global picture of the impact of ageing on pension reform, at least in terms of high income countries. Academics and students with an interest in economics, social policy, sociology and political science will find this a worthwhile and rewarding volume. It will also be of value to policymakers interested in how the problem of unsustainable pension systems can be resolved.

This book focuses on pension policies in Europe and interestingly includes comparisons both within the EU and between EU countries and the US. The authors show how different countries are confronted with similar problems and that comparison of national experiences may be of great help for the 'open method of coordination' now adopted in the EU. The papers deal mainly with the effects of the huge payroll taxes differentials between countries on individual retirement choices and the labour market, with taxation of contributions and pensions, and with the portability of occupational pensions. The main impact on labour supply is shown to be early retirement due to actuarially unfair pension formulae. The authors also argue that the US experience shows that taxation of contributions and savings for old-age may not generate the hoped for incentive effects, while an example of inconsistent taxation of pensions is offered by Germany. Finally, it is shown that limited portability of defined benefits plans does not appear to be a strong impediment to labour mobility in Europe. Pension Policy in an Integrating Europe will be valued by scholars of both public policy, public finance and European studies, and those practitioners and policymakers involved in insurance in the EU.

Superannuation was once a privilege granted only to company head office staff and career public servants. Now in Australia nearly all workers have access to employer-contributed superannuation, and it is a fundamental pillar of Australia's retirement income system.Workers' Capital tells the story of the Australian superannuation revolution led by trade unions in the 1980s. After a series of hard-fought industrial campaigns, an enormous financial industry was created, involving hundreds of thousands of employers and covering millions of fund members. From having one of the worst retirement savings systems in the developed world, in three decades Australia had one of the best. Now the funds held in Australian superannuation accounts exceed the entire market capitalisation of all the companies on the Australian Stock Exchange.Drawing on interviews with the key players and extensive archival research, Workers' Capital is the first systematic history of the unique Australian system of industry superannuation.'Startling and informative-I thought I knew a lot about the industry superannuation phenomenon, but this one took me by surprise. For a topic so important, a real page-turner.' Gerard Noonan, Chair of Media Super, former editor of Australian Financial Review

There is increasing pressure for all of us to take responsibility for our own financial security and wellbeing, but we often overlook how the benefits that come with a job can help us do that. Essential Personal Finance: A Practical Guide for Employees focuses on these valuable work benefits and shows how you can build on this important foundation to achieve financial security and your life goals. This unique book explores how making effective and practical use of these work benefits (such as pension scheme, life cover, sick pay, cheap loans, savings schemes and even financial coaching), means facing up to the behavioural biases we are all plagued with. Given that these can get in the way of even the best intentions, Essential Personal Finance tackles these biases head-on with practical ideas and tips for overcoming or harnessing them for good, and will help you to develop a positive and fruitful relationship with your money. With financial stress being a major cause of absenteeism and sick leave, low morale and lost productivity, the advice in this book also offers employers enormous benefits. By empowering employees through financial education and financial awareness, progressive employers will help them feel more in control of their lives, and experience less stress, resulting in higher morale and productivity. Offering a distinctive approach which combines academic insight with practical financial wisdom and tools, this is a must-have book for all employees. It will help you make the most of everything your job has to offer so you can worry less about money and live life to the full.

There is increasing pressure for all of us to take responsibility for our own financial security and wellbeing, but we often overlook how the benefits that come with a job can help us do that. Essential Personal Finance: A Practical Guide for Employees focuses on these valuable work benefits and shows how you can build on this important foundation to achieve financial security and your life goals. This unique book explores how making effective and practical use of these work benefits (such as pension scheme, life cover, sick pay, cheap loans, savings schemes and even financial coaching), means facing up to the behavioural biases we are all plagued with. Given that these can get in the way of even the best intentions, Essential Personal Finance tackles these biases head-on with practical ideas and tips for overcoming or harnessing them for good, and will help you to develop a positive and fruitful relationship with your money. With financial stress being a major cause of absenteeism and sick leave, low morale and lost productivity, the advice in this book also offers employers enormous benefits. By empowering employees through financial education and financial awareness, progressive employers will help them feel more in control of their lives, and experience less stress, resulting in higher morale and productivity. Offering a distinctive approach which combines academic insight with practical financial wisdom and tools, this is a must-have book for all employees. It will help you make the most of everything your job has to offer so you can worry less about money and live life to the full.

The ultimate guidebook for navigating the new world of pensions and retirement plans

In the wake of the explosive growth of defined contribution (DC) plans invested with target date strategies, and the understanding of how important these strategies can be in effectively meeting retirement income goals, plan sponsors are seeking more optimal target date approaches. This timely book provides you with in-depth answers from the nation's most qualified and experienced experts to pressing questions about DC plan design.Presents the views of individuals from all across the marketIncludes a broad range of plan sponsors both in the corporate world and in the public/government sectorsOffers views from consultants and advisors from the most respected firms, academics who teach at leading universities, and other innovative leaders

With a broad range of knowledge and insight, "Designing Successful Target Date Strategies in Defined Contribution Plans" helps you understand the evolution of DC plans, pulls together all angles of what it takes to develop custom target date strategies, and provides you with a look ahead to the future.

This book focuses on relatively unexplored areas in pension and health care arrangements, including financing, in East Asia. The book aims to fill the literature gap on social protection in East Asia by covering issues such as pension and health care arrangements in the depopulating high income countries of Japan and Korea; the challenges of the pay-out phase in Defined Contribution (DC) arrangements in Australia, New Zealand, and Singapore; and the extension of coverage of social protection schemes in China, India, and Indonesia. It also reviews social protection from a much wider perspective and extends coverage of social protection in terms of both the proportion of the population with access to the social protection scheme and the types of risks faced by the households and by society as a whole. The book also gives attention to reforms of civil service pensions.

Economic Restructuring and Social Exclusion provides a timely reminder of persisting inequalities of class, race and gender as a consequence of the changes which have engulfed Europe in less than a decade. The contributors consider key debates including democracy, social justice and citizenship. The book also examines evidence that social and economic polarization is increasing, and the prospect of a conspicuous and growing "underclass" in Europe's urban centres is fast becoming a reality. This volume will be particularly valuable for undergraduate and postgraduate students in sociology.

Perhaps the greatest long-term challenge facing modern economies is how to pay for the living expenses and care costs of the elderly. Following policy decisions made in Australia in the 1990s, a substantial part of the pension requirements of the next cohort of retirees will be met from savings accumulated during working years. The effective management of these savings is crucial. If they are invested wisely, the assets available to fund pensions and care will grow; if not, available funds may turn out to be insufficient. Unfortunately, there is considerable evidence worldwide that the management of funds attracts rent-seeking behaviour by the financial services industry which erodes much of the potential return. Australia introduced compulsory superannuation contributions for its working population in 1991, leading to a proliferation of funded schemes that are largely run by the private sector. Complexity, and many degrees of separation between fund members and those who manage their funds, have emerged as serious problems. Combined with weak competitive pressures and governance systems, and insufficient legal and regulatory constraints, the result is a system that does not serve its members well. This book provides a detailed evaluation of the Australian experience, highlights the extent to which the financial services industry has extracted rents from Australian pensioners, and how and why this occurred. Based on original empirical research, and examination of industry reviews and relevant literature, the book demonstrates the numerous principal-agent, conflict of interest and rent extraction problems that have emerged in Australia. The book makes suggestions for how these problems can be addressed in Australia, and also provides lessons for other countries wishing to enact pension reform.

Pension fund benefits are crucial for pensioners' welfare and pension fund savings have accumulated to huge amounts, covering a major part of world-wide institutional investments. However, the literature on pension fund economics and finance is rather limited, caused, in part, to limited data availability. This book contributes to this literature and focuses on three important areas. The first is pension fund (in)efficiency, which has a huge impact on final benefits, particularly when annual spoilage accumulates over a lifetime. Scale economies, pension plans complexity and alternative pension saving plans are important issues. The second area is investment behavior and risk-taking. A key question refers to the allocation of investments over high risk/high return and relatively safe assets. Bikker investigates whether pension funds follow the life-cycle hypothesis: more risk and return for pension funds with young participants. Many pension funds are rather limited in size, which may raise the question how financially sophisticated the pension fund decision makers are: rather professionals or closer to unskilled private persons? The third field concerns two regulation issues. How do pension fund respond to shocks such as unexpected investment returns or changes in life expectancy? What are the welfare implications to the beneficiary for different methods of securing pension funding: solvency requirements, a pension guarantee fund, or sponsor support? This groundbreaking book will challenge the way pension fund economics is thought about and practiced.