t w F o h if g h e t u iy h c r h e e w . Q s R 1 o im u L e sA a lh d u lC o i ltla y s w i v tC a e s e r h d t e u e h D n c u e k t It A s ip ill: ie a p z “r A e t u c d lr e C e c n a a o h t s m s a a tp s p g a e a a e g s r r a e t cr th o e i8 v a s f5 e n u a A w g l t 4 n e e i0 a n r i1 ln e ya ( s R k e n is )e i t R p o t h iR flr e a R F e r n u m i, s tn u o a e c rm n n e re d t e B a R w fe s ie n n e h a e d a f d fs o itti s n r t in h e ftrt a h s o e t s e m r , R e h e P s a ivg t r te ie ih v n n d a e g ta s o e st t -r t S a th v o e g e a c d e t r t- a o y r sy r e p i,’n s s e V t u c o h e lilt ir f u s ie f n c tr s o to w a tr e m ria y c d - g a E p ie ln ln u y q rr p o lc u o u lh la m w ra r ce t s h iin in ln a e tt s g . 4 e i 0 n r a1 e g 1 (s k s 0 t)u - ch T-183 A O Re p pf p te ie m rn ea d nlic x L e e A sv :e B ls r io ef f D De ef se cr rr ip et d io In nc o ofm Ee B R AIn ’sn R ue itty ir P eu m re ch na t s Se esc f uo rr it R y e Ptrio re je m ce tin ot n a r y a e p ta e rro s l,d a tu d h c d P e te l ;a t rh r n e a s o d n w v s Q se f.e L v S A re tC o y r, l fi o z tle h f o d i1 n s ,.g 5 F p e ie n p vr a ie c tlr y - e A c n r e v itn e s a k rtg a o p e gf r e d o - 4 r P v 0 o a i1 d p y( e p k D s e ) e d a a fi c n s tc o ie g o d n 4 u B i1 n fe it p c n a e b en r a fic t tl a e a in n n nc c t d r e fe C o sa a r w s ste h ih t h io B n s a t e r h la e e w n t c ic h re e u o m P r r b le a e e n n n ls it t e . ” e r v e m E ea d B p d R ilit o n I y w Ie s e s s a r s u s f e f“ r o o s B ro m rt im e h fa e ,e g n w le o oh s .n a 3 5 gt 8 5 e 7 l? s i k t 6 - e 4l y” ® Endnotes Deferred Income Annuity Purchases: Optimal M Ino co de m l e Adequacy imA m be ra dh iaa tm ea (,E n K n m .u p G ilto .i,e y& s e. e c H o B a m rer.n i s T e ,h fB ie t . R rH a e.t s e “e B sa e w rtcte h er re I n F w s in tiia t tu h ntic e ni,a 1 J l .u S 1n e p e c e u 2 rr c 0 it e 1 yn 3 it ) n .o R f e th tir oe sm e e un st e ? d R be ya B lilz ain ng ch te ht et P (S rp om rin is ge 2 o 0f1 L 5o ) n bg ae sv eid ty o A nn q nu uo itite es s. ”o btained from t l fio h vr a e t d h t o q h u u e sa y er h w tio lo e ld u , s lc d o i n lm i v tp e ha e u r n le o t d n i lw g a e t it s lh te r a o e s n lta l y a t ig a ve e s -m 8 lo 5 a n .l g O l e rn e ve d it -u y qc u q ta iu o ra n tr e t frio l( e r2 t w 5 h ip e th e g r a e c n e Q e nL r tA a ) lC o p fa o tsh p w o us le a e lt l iw a os h n o t . h S b e ee n ilm s ie it p v ia v ec id tty to h an a n t a a t lly lh s h e io s y u o w sn e e h t rh e oe ld s Summary and Future Research Figure 3: Percentage change in EBRI Retirement Readiness Ratings from 22 CAT N h N eE o X.b G je ec n td iv ee r- o sp f e tc h if e ic n re aw te s r e w se era er u ch se f d o irn t th hie s a te ns at ly im sis o e nv ye w n a th so tu og e hx u p nlo isr ee x h ra o tw es t w ho eu p ld r o bb ea ub sie li d t y fo o rf i n a- p “lsa u nc o ce ffs es rf in ug l” s . Consistent w Q eiL itth A he C a r p “ Q r n E e Lo m c A to C it n a .o o r o m e i ls c ik u S e lt tli u y n d ”g i e o fs r r o a “m tn B o r ltio k a o e t kl iy a n lg iln slc i( k r N e eo la y v s ” e e m t so b i n e li rv f 2 e u0 tu u 1n 4 re t ).i li n at te lr ee as stt ra ag te e s 8 p 5r r o e vp id oe rt se e dv t eh n a m t to hr e e y fw av eo rr ea ib nlt e e r re es su te lt d s .i n EBRI launched a major project to provide retirement income adequacy measurement in the late 1990s for This testimony reviews prev va io ru io su as n D alIy A s ip s u of r c th he a s ae bsi la itt y r o e ft Q irL eA m Ce s n to t b py ro a vg id ee a a tn d e e fa fe tc ht* iv e longevity hedge for ® . “Retirement Savings Shortfalls: Evidence from EBRI’s Retirement Security Projection Model. ” EBRI Issue Brief, results were obtained when the simulations were repeated using a 50/50 gender mixture. Turner and McCarthy (2013) evaluate the retirement varies with the percentage of the 401(k) balance that is used to purchase a deferred income 1 purchasing this type of product at retirement. Levels for 2R 0.0% etirement Income Adequacy This includes studies on the impact of freezing of defined benefit accruals (VanDerhei, 2006); the transition from defined benefit to t sh eo ve se ra B l o st o a m te e sr s c o an nc de G rn ee nd X w eh rs e w thh eo r t ah re e is r ir m eu sild ae te nd ts t w o o pu ar ld ti c hia pv ae te s u in ff a ic n ie in nt -p in lacn o m ofe fe w rih ne g n e itth he ey r r te ha ro ch ue gd h a 10- Blanchettn , o D . .4 “1 A0 ll o (E ca m tip nlg o y to e e a B D e en fe er firte R d e In se co am rce h A Inn sn tiu tu itty e ,i n F a e b D ru ea fir nye 2 d0 C 1o 5n ).t ribution Plan.” The Journal of Retirement, 54-68 impact of the need to calculate benefits on a unisex basis when offered in a 401(k) plan. N Th ee w i n re cr se ea as re ch in w ta hse p E rB eR pI a R re ed ti r fo em r te hn is t tR ee sa tid m in o e n sy s t R o a e tix np gls o ( rR eR h R o)w -- te hs e s e pn ro tib aa llb y it lih ty e o pf r o ab “a sb uic lic te ys o sf f u N l” O rT e t riu rn en m in eg n t annuity (DIA) where the probability of success is measured by the EBRI Retirement Readiness Ratings (RRR) defined contribution plans (VanDerhei, June 2013); a comparative analysis of automatic enrollment 401(k) plans relative to voluntary retirement age. After conducting E stR udI ieS s A for O A red gov ni , s Kao nsr ay s, aC ndo Mu asn sac chiu ls etts, EBRI developed a national ye ar series of laddered purchases or as a one-time purchase based on the accumulated value of employer Figure 2 in VanDerhei (2015) shows a similar relationship between the level of interest in purchasing a (Spring 2015, Vol. 2, No. 4). s vh ao rir ets o w f im tho t n h e e y p in e rrc e e tn irte am ge e n ot f - t-h fe o 4 r 0 E1 a( rk ly ) b Ba olo am nc e e r s t h in a tt h ise u ls oe nd g e to st p ru er la ct hia vs ee -l o an d ge efv eir tr ye q du ia nr cto ilm e e w a itn hn a u iQ ty L A (D CI A is) . 23 from the EBRI Retirem 1e 5n .0t% Security Projection Model®. For purposes of these simulations, we use existing enrollment plans (VanDerhei and Copeland, June 2008); employer contributions when converting from voluntary enrollment to The annuity purchase price currently charged for an applicant age 65 is used for all individuals, regardless of age. To the extent m c o B o n y d t r e J ia .lb “ c iu T n kt h i2 V e o 0 a n I0 m n s3 D p f— r a e o c rE m th B o e R ft i ,h A I ’P e u sh t R c o .D u m er t .a r ir te ie c n m E t n e ern m otlp l m Sle o ec y nu e t r r in i.t T y 4 h 0 P 1 e r( o k aj)n e P a cllt a y in o ss in s o M fn in o F d d u ste u tlr h ® ea (R t R e e Stv P ire M en m ) a — et n a tt h n Ae d cc h iu n im s 2 tu o 0 la r 1it0 c ioa n ilts l y w : A la o s S w iu m ip n u d t la e atr t io e en s d t S tro ta u t de ys in QLAC-type product and the respondent’s perceived likelihood of living to age 95. In this case, more than 23 R on es ly u l 1 t.s9 a p re e rp cr eo nv ti d be ud t ifto ir n a cr lle h ao se us s e to h o 2l.d 9s p (w eric th en at 4 fo 0r 1 ( Lk a)t e b a B la on oc m ee ) r cs o a m nb di n 3e .5 d p ae s rw ce en llt a fs o r b y G e sin m X ue la rs te . d T ah ge e lo afr ger auR to Sm PM ati c a c ec nu ro m llu mle an tito a n n m d io ts d iu m le ps li c ta ot is oin m su fo la rt r e e t rie re tim re em nte in nt c o in m ce o m (Ve an /w De era hle th i, A ap t ra ilg 2 e0 6 15 0) f ; o prl aa nl ld U eS si g h n o a un sd e h eo m ld pls o yee behavior for that future mortality improvements are reflected in the QLAC premia for Late Boomers and Gen Xers, the improvements in RRR U.S. Department of Labor B inla co nc rh pe otr tB ,a a D te s. e “s d D e e o vtn e e r rP m alla i n s nii n g D g n e its f h iig c ea n O n M p t to c im d h ifa a ic ln a F g tiie x oe s nd ,s i A n on c f ln L u u ad irtg iy n e fg o P rt lh a Rn e e tS iim rp eo s pn :a s Ic m o trs m s .o e ” d fE iD a BtB R e Ip v Ie ls a rs s n u u e fsr B e De re ie z fe e f,r sr n ,e o a d .u . ” 3t 4 J o1 o m u (r E a nm ta ic lp o le o fn y F e rio n e a lB ln m e cn e ia e n lf t it 20 R 1 e 5 s,e ta hre c h tr D an irs efc etro o r,f E lo m np gle ov yie ty e r B is ek n p ef rio tv R id ee se s a ar c sh ig n In if sitcia tu ntte i n (E cB re Ra I) s e in retirement readiness for the longest- one-half (53 percent) of those who believed it was “very likely” or “somewhat likely” that they would live 10.0% p de er ac te hn . t T ah ge e r in ec sr ue lt ass e as re f o ar ls to h e p ry o o vu id ne gd e rb c yo a hg o e r-ts sp a erc e if lia cr w ge alg ye a q fu ua nrcttiilo es n. of their larger 401(k) balances as a automatic escalation provisions in automatic enrollment plans (VanDerhei and Lucas, November 2010); and increasing default wb oe ultd w le ike en ly 3 d 5 e c arn ed a s6 e4 f.r o Hm ou ts he oh se o lp drso w du it ch e d n o b y 4 t 0 h 1 e( k c) u r b ra eln atn s cie m su a la t trie ot nis r.e ment age are filtered out of the analysis 26 provision Rs e s fo ea r r4 c0 h 1 In (k s) ti tp ulta en , A s,p a rin l 2 d0 t1 h 0e ). crises in the financial and housing markets. EBRI has updated RSPM® lived qua Prla tin le n,in cg o , m 27 p ( a8 r)e , d 3 6 w -4 it 4h ( 2 o0 n1 ly 4 )a . small reduction for the general population. Sensitivity analysis on the until at least age 95 were either somewhat interested or very interested in purchasing such a product. This com ntu ril b tu ip tilo en o sf f o er a a rn ui tn og m sa . tic enrollment plans (VanDerhei, September 2012). and a retirement age of 65 is assumed. 24 Payouts were calculated based on illustrative quotes provided by MetLife as of July 1, 2018. Q on L A aC n p ar ne n m ua iu l m ba ss r ie s s su in ltci5 e n. g 0 t % h fr eo nm fo lr ik c eh ly a n in gc ers e ia n s e fis n ia nn f cu ia tu l a re n d in r te ea re l s ets t ra at te e s m pa rr o kv e id t e co s n ed vie tn io m nso a re s w fae vlo l r aa sb flo er r esults. percentage dropped to 35 percent for those who believed it was “not too likely” that they would live until at Hearing on: Introduction ®” 2 P D e r f e i n e v .d i“ o W Co u hn ys t rD i bR o u ete s io s R n e e In ta is re tr im tc uteh io nn t o a Rle n Ia n d vL e ino se tm s n seg V ne ta A rv ys:i sR t oy e cs i a u A tilo ts n n f.n r o Qu m ua iE t liB fiye R inIs g ’s L 2o 0n 1g 4e R vie tyt ir A en m ne un itty S C eo cn utrria ty c tP s:r o Fje re cq tiu oe nn M tly o d Ae slk . ed VanDerhei (Spring 2014). One problem with performing the simulations using only current annuity purchase prices is the impact of underlying demographic changes and changes in 401(k) participant behavior (based on a database of the 25 least age 95 and 30 percent for those who believed that they were “not at all likely” to live until at least age T Th hie s s b pa esce ia liln re u ls et p or co h va id se tis c td he ac t,u im f cu er la ta ti in o n co m nd oid tiu oln e s ia sr r eu sn a tw isf it ie hd a , n a s ae srs iu es m op f t tia o rn g e o tf d n ao te a fn un nd us it (iT za Dt Fis o)n in ( e ai t dh ee fir n e Sd P Ic A o n otrr ibution plan Modeling retirement income adequacy for non-retired U.S. households has often been split into an analysis Journal of Retirement (Spring 2014). Questions (FAQs 0). 0 (% December 2014). New analysis is then provided on what might be considered the optimal percentage of a 401(k) balance that 3 historically low discount rates. In 2014, Moody’s annual “Yield on Seasoned Corporate Bonds—All actual account activity of some 24 million 401(k) participants). S9 e5 e .A ppendix A for a brief description of EBRI’s Retirement Security Projection Model®. is t T rh ee at c eo d n ac se ap sti n og fl e lo rn ig g h e tv o it ry f e aa n tn uu re it fio ers p au sr p ao lo se n sg o efv tih ty e h ne od nd gie s ch ria m s ib na ete io nn d rie sq cu uis rs ee m de f n o tr s a ot f § le 4a 0s 1t( a 1)0 (4 y ) e oa f r ts h.e I n In 2 te 0 r0 n5 a, l Revenue Code. DIA) and sensitivity analysis on DIA annuitization by assuming various percentages (5, 10, 15, 20, 25, and 30 of the accumulation phase (current age until retirement age) and the decumulation phase (retirement age should be converted to a DIA if the objective is to maximize the probability of a successful retirement (as Industrie1 s 2, AAA” was only 4.16 percent—more than 370 basis points below the average dating back to 1976. 4 Milevsky published a paper analyzing an inflation-adjusted, deferred-annuity contract that would begin 26 p G Ve a on r nc D ge ,e n G rh t.)e , io & , f J W .t,h e a e b n b d 4, 0 C A 1 o .( p E ke )v la b aln a ud la a ,t n iC nc g . e “tE h aR e t Ir A S e d A tv iA a re n t m c 3e 0 e d : n T L th i fa e er D D e e e u c fe s lie rn rd e e d t o o fA P n pn ru iu vra ic tty h e — a -S s A e e n c a tA o D n r n D IA u e i tfw y in iP e th d e o B 2 pe 0 le n y e M e fia itg r P h d r t o A e m f ce its u re a rs a ll y la a n B n d ud y A n nn ou d ite y ath O un nte il o th f e th a eg b ea o sfi cd o eb aj te hc )t . iIv n e t sh o ef lR aS st P M 15® y e isa t ro s, stih m eu E la m te p lt o h ye e e p e Bre cn ee nf tia tg R ee o se f a th rc eh p Io np st u it la ut tie o n (E a BtR rIi)s h k a osf c n o o n td h u a cv tie nd g a Individuals born from 194-8 5– .0 1 % 954. A Fi g bu rir ee f c 3 h i rn o n V oa lo ng D ye o rf h R eS i P (2 M 0 1 is5 p )r s oh vo idw ed s itn h A e p p pe ern cd ein x tA a g oe f V oa fn w Do er rh ke eir ( sF ie n b t ru ha er y R C 20 S1 w 5)h . o were either somewhat measured by the EBRI Retirement Readiness Ratings). We find that at current rates, purchases of a DIA The 2012 Individual Annuity Mortality (IAM) Basic Table and observed market prices were used to 24 65-84 85-89 90-94 95-99 > 99 all 1 payouts not at retirement age but at an advanced age (e.g., 80 or 85). In essence, this contract would benefit.P a W yme e n ats ss? u W mh ea t t h W ei lp l Ie t rM ce en an t ? a”n E dB d R o I lIls as ru c eo B nrsie tr f,a n in ot .s 2 f 6o 9r (c Eu m rp re lo n yte Q e L BA eC ne s fa it rR ee n so ea t rb cih n Id nis n tig tu . te, May 2004). significa( n S te a pm teo mu bn et r o 20 f 0 r7 e)s.e R ae rtc rh ie v oe n d tA hu eg iu m stp 1 a7 c,t 2 o 0f1 v 5a , r frio om us h a ttc pc :/u /c m rr.u blc a.t eid ou n/- w pp h -a co se nt e sc ne t/n up alro ia od ss ; / 2 h 0o 0w 7/e 0v 9e /w rp , _ o2 n0 ly 0 7-151- retirement income adequate to cover average expenses and uninsured health care costs (including long- 5 interested orL v if ee rt yi m ine te Ir n ecso te m de i n S o plu ur tc io hn as s ia ns g a s u Q cu ha a li f Q ie Ld A C D -e ty fa pu el t p r In ov de us cttm ae s n at f A un ltc etrin on at o iv fe h ( o Q uD se IA h) o – ld income and 27 deferring 20 years with no death benefits results in an overall improvement in RRR (for all ages of death O in nt ee o rf p to hle a t p e r if m oa r rt yh o eu itn ptu e tr se o sft R rS aP te M t ih s a tt h,e w ph ro ed nu c co tim onb o in f e Rd e tw ire it m he tn hte R c ea as dh in fe lo ss w R a at n in dg m s (o Rr R tR as li)t fy o a r s vs au rim ou p st s io un bs g, r oups of the VanDerhei and Copeland (July 2010). 5% -0.3% -0.1% 1.3% 2.5% 4.0% 0.3% attempP te tro ce a np tp ag ly e b oa f sic risk-management principles to retirement planning and would carve out the high- 508.pdf t re er cm en -c tla yr h e a cs o a st n s ) a a ttte a m gp e t6 b 5e o er n o m lda ed re t h to ro q uu ga hn otu ifty r t e h te ir e im mp ea nctt i n o fs t p h e e c ip firc im ina cro ym de e c au nm d u alg ae ti o gr no -p uh pa in sg es r . iR sk Ss P:M ® age. Regardless of household income, workers ages 45 or under were much more likely to be interested in Focus on Decumulation and Rollovers population. The RRR is defined as the percentage of simulated life-paths that do not run short of money in retirement. combined) for DIA purchases equal to 5, 10, 15 and 20 percent of the 401(k) balance. However, there is an reproduced the original premium. Using those parameters, a 100-basis-point increase in the interest rate . “The EBRI Retirement Readiness Rating:™ Retirement Income Preparation and Future Prospects.” EBRI Issue Figure 3 shows the perce1 n 0t% age ch -0 a.n 6% ge in RRR -f 0r.o 3% m various2 D .0I% A purchas4 e.s 4 % at retirem7 e.n 6% t by age at0 s .4 im % ulated 401(k) balance probability/low-severity costs (e.g., retirement income from 65?85) that could be budgeted relatively easily l a o ls no g e pv rio tv yi d rie sk s ,i n lo fn og rm -te ar tm ion -c a or n e t a hn ed d h iso tm rib eu -h tie oa nl to hf c to hs et s li,k a en ly d n in uv m eb se tm r o ef n y t e ria srk s. before those at risk run short of purchasing such a product. At least some of this age discrepancy could be attributable to public perceptions overall decrease in RRR for DIA purchases equal to 25 and 30 percent. 6 would produce an approximate 21 percent decrease in the premium rate (and a 200-basis-point increase Brief, no. 344 (Employee Benefit Research Institute, July 2010). In d Hd e eia lv m itd h a u . n a a , A lt R s s a b . ,g e o C e x r n o p 6p 5 e fe r c u o lt a s m e n ed d d 1 ,, 9 a C 5n .5 ,y – & o 1 n V 9e 6 a4 n d .D ye in rh ge p i, rJ io . “ rT th o e a 2g 0e 1 5 8 5 R e (t tih re em ee n nd t C oo f n th fid ee 2 n0 ce y S eu ar rv d ee y:f e Hra rv ailn p g e ar iR oe dt) ir e w m oe u n ld t S a acvtiu ng as ll y P lan 15% -0.9% -0.9% 2.3% 6.0% 10.9% 0.4% from the typical retirement scenario before transferring the low-probability/high-severity costs (e.g., money, as well as the percentage of preretirement compensation they would need in terms of additional of the future solvency of Social Security. RetireA m ue gn ut s t b 1 e5 n,e 2 fi0 ts 1 8 p aid by Social Security represent a major would produce approximately a 37 percent decrease in the premium rate). Sensitivity analy 2sis for this likely to a p K u e ry c h Fa asc et o ar in Americans’ Retirement Confidence.” EBRI Issue Brief, no. 413 (Employee Benefit Research have their RRR decreased since they would have had a portion of their 401(k) balance used to purchase the 7 A re st ip ra er m t e on f t t h ce o s a ts ss f e rs osm m e 8n 5t t o hf r o th ue g h im th pe a c rt e m ofa lio nn dg ee rv o itfy t h oe n r re et tiir re ee m ’s e n lif te i) n t co o m the e a in ds eu qru aa nc cy e, c Eo Bm RIp a un sy e.d T ih ts is would 20% -1.3% -1.5% 2.9% 7.1% 12.2% 0.1% In sd aiv viin dg us a lis n b o or rd ne fr r o tm o h 1a 9v 6e 5? a 1 9 57 04 , .7 0, or 90 percent probability of retirement income adequacy. When the results are broken out by age at simulated death, we find overall decreases in RRR for those dying portion of the longevity protection for many retirees and the prospects of this benefit being modified when . “The Impact of PPA on Retirement Savings for 401(k) Participants.” EBRI Issue Brief, no. 318 (Employee Benefit reductiD oIn A id ne p fe rr e rm ing iu 2 m 0 rates if interest ®rates inc3 rease at least partially to historical norms was undertaken by Institute, April 2015). DIA but had not lived long enough to benefit from it. For those dying before 85 and using only 5 percent of Retirement Security Projection Model (RSPM) to establish relative-longevity quartiles based on family be analogous to accepting a deductible on automobile insurance collision coverage and considered a more 25% -1.7% -2.3% 3.1% 8.0% 14.6% -0.2% 8 before benefits begin (ages 65-84) as well as for those dying between 85 and 89. For each of the groups the Social Security Trust Fun 27 d is C 5 e5 xp 2e 1c R te od o m to 4 b a et d te hp el e U t.e Sd . D m ea py a r ptrm ov ein dte o a fn L a in bco ern tive for younger workers to Research Institute, June 2008). years (no death VanDerhei (September 2006), Park (May 2011) and VanDerhei and4 Copeland (May 2004). r A e p pr ee av tiio nu gs t h Ee B R aIn p au ly b sliis c a utsiio nn g p r de em scir uim be r sa h to e w d e h co re ua se se hs o l o dfs 1 a 0 r,e 2 t0 r a acn kd e d 3 0 th p re oru cg eh n t r.e tirement age and how their their 401(k) balance to purchase the DIA, the RRR would decrease by 0.3 percent. As expected, the RRR status, gender, and age cohort. For the Early Baby Boomers simulated to die in the earliest relative quartile, efficient method of choosing which risks (or portions thereof) should be transferred to an insurance 30% -2.1% -3.0% 3.2% 9.6% 16.2% -0.4% living beyond age 90 we find an increase in RRR and, as expected, the larger the percentage of 401(k) consider a QLAC-type product as part of their individual risk management. Figure 4 in VanDerhei (2015) Milevsky, M. A. “Real Longevity Insurance with a Deductible: Introduction to Advanced-Life Delayed Annuities (ALDA).” benefit) 9 retirement income/wealth is simulated5 for the following components: 13 decrease is monotonically increasing as the percentage of the 401(k) balance used to purchase a DIA Tt h h ee f iR ne at l irru elm ese on nt Q RL e A aC d si n we esrs e R pa ut b in lis g h ( eR dR in R )th o e fJ u 7l5 y. 2 8, p 2e 0r 1c 2e F ne td w era as l R 1e 9g .1 is tp ee r:r c he ttn pt:a // gw ew pw oi .n gp ts o .lg ao rg v/ e fr d s ty hs a /n p k tg h/e F R o-v 2e 0r 1a 4l-l0 7- company. When the premium rates are decreased by 10 percent, the percent increase in the RRRs (compared to the VanDerhei, J., and Lucas, L. “The Impact of Auto-enrollment and Automatic Contribution Escalation on Retirement b sh ao la w ns c e th u aste td h e to p p eu rc rc eh na ta se g e a o D fI w A,o trh ke e r la s r4 g5 e r o t rh ye o u pe nr gc ee rn in ta tg ee re is ntc e rd e a in se a i Q n L RA RC R-.t ype product is 40 percent for For households currently ages 35-64 who have a 401(k) balance at retirement age (65). North American Actuarial Journal (2005). 9 (4), 109-122. 02i/n pc drfe /2 a0 se 1s 4.- 1 A 55 t 2 a4 2 .p 5d p f e Fo rc r e an d te lt e av ile eld t s hu e m R m Ra Rr y d e of c r th ee a s re u lr ee sa , s ce he e D s e 1f.i7 n e p d e C rc oe nn tr ti b au ntd io a nt I n as 3 ti0 tu p tie or n ca e l n In t vle es vte m l e it n its A 2 s.s1 o ciation average for this age cohort. The RRR decreased to 63.1 percent in the second relative-longevity quartile and baseline of no QLACs) vary from 2.5 percent for Early Boomers to 4.6 percent for Gen Xers. A 20 percent ? SocIin ac l o Sm ec eu A rd ite yq . u acy.” 1 4EBRI Issue Brief, no. 349 (Employee Benefit Research Institute, November 2010). Source: EBRI Retirement Security Projection Model® Version 3427 those who believed Social Security would be a major source of income in retirement; however, it increased In 2007, Gong and Webb attempted to deal with the fact that rates of voluntary annuitization remained (December 2014). percent. 44.9 percent in the third relative-longevity quartile. For the Early Boomer cohort with the longest relative The need for longevity protection is arguably less for those in the lowest wage quartile given their greater P de ar ck r,e Y a.s “ e R ie nt ip rerm em enitu Im nc o ra mte e s A d in ec qru ea a csye W s t ith he I m ra m ne gd e ia o te f R an Rd R L io nn cg re ea vis ty e s A t no n u 3it.i2 e s p .” e r EcB eR nIt If so sr u e E a Brrliy e fB , n oo o.m 35 e7 r s( E to m 5 pl.o 3y ee * second death for couples to 47 percent for those who believed it would be only a minor source of retirement income. The portion of extremely low by analyzing what would happen if longevity annuities were used as a 401(k) plan default. ? DC balances. 10 longevity, the RRR fell all the way to 37.9 percent. Similar influences were found for the younger age r pe elr ia cn en ce t f o on r S G o ecn ia X l e Sr e sc . u A r i3 ty 0. p W ee rc b er no tk d ee o cr ue ta ts h e e i n o v p erre am ll iR uR m R rca h ta en s g in ec sr b ey a s ae gse t -h sp ee rc ain fig c e w o afg R eR q R u a in rc tirle ea ss a en sd t o fo 4 u .n 5 d For an exB ce eln le en fitt a Rn ea sle ya sirs c h o fI n th st e it u m te a,r k M ea t y f o 2r0 l1 o1 n)g . evity annuities, see Abraham and Harris (November 2014). those who expressed interest in a QLAC-type product increased to 59 percent for younger workers who Realizing this had the potential to harm S htia gh te -m mo er ntta f lio ty r t h h o e u R se eh co olrd ds b (y re lative to taking the 401(k) balances in For those dying at ages 85-89, the difference between the cost of the DIA and the present value of the cohorts, but there was a noticeable increase in the RRR range between the earliest and latest longevity that in all but the smallest DIA purchase (5 percent of the 401(k) balance), 1h 8ouseholds in the lowest age- pe ? rc e IR nA t fb oa r lE aa nr cle ys B . oomers to 6.7 percent for Gen Xers. 11 be lieved Social Security will not be a source of income in retirement at all. unannuitized form), the authors used nume Jr a ic ca kl - V o a p n tD im eirz h ae ti io , P nh t.e D c.h niques to show that few households VanDerhei (2015) eventual benefits results in a decrease in RRR regardless of the percentage of 401(k) balance used but the 6 Figure 4: Percentage change in EBRI Retirement Readiness Ratings from Pfau, W. “Why Retirees Should Choose DIAs over SPIAs.” Advisor Perspectives Newsletter (September 24, 2013). quartiles: 37.9 percentage points for Early Boomers, 41.3 percentage points for Late Boomers, and 49.2 specific wage quartiles experienced a decrease in RRR from the purchase of the DIA. However, households would suffer significant losses under this tyE pB eR o I fR d ee sf ea a u rlc th ( a D si r m ec eta osru red by the authors’ methodology). 12 Figure 1 also tracks the change in RRR for all households (including those who do not live to age 85 and thus de ? c re D aB s e a n isn lu eists ie ts h a an nd t/ ho art le ux m pp e- rs i7e un m ce d d is fto rirb tu hto io se n sd . ying prior to 85 for a 5 or 10 percent purchase but the Milevsky (2005). percentage pointsv fa or ri o Gu es n D Xe IA rs p . u rchases at retirement by age-specific wage quartiles with higher wages had a much more positive experience with those in the second age-specific wage quartile Employee Benefit Research Institute (EBRI) S P d do e cr o c e n trte o ,v a J ti .s ro e S e u .c i s e “T s ig v h r 1 e E e e 5 a a L B t n oe R n yr g I ie t n h R v cia o te y n m A s te h n e n a ba u te ir te n yc x e : p h A fie n t r s o iA e fn o n n n rc u e tQ ih td ye L f fio o rA rr Q E C tL h v A e o S C rs yc e o pe n r de e n y? m ia n ” ig F u r im i p no a rs ins o )c .r iT a th lo A e 8 n r5 a el y s fo s utr ls t 2 s J 0 o a,u r e 2 rn 5 t a y la ,p n 6 id c 4a ,3 l4 l0 y 0 -p s 4m e 8r a (c2 le l0 n ( 0a t8 ld ) l .l u ee s s t o th ta hn e 1 In 2013, Pfau demonstrated how deferred income annuities (DIAs) expanded the retiree’s “efficient 13 1.0% experiencing an increase in RRR for all purchases through the 20 percent value. Households in the third age- ? Net housing equity. Scott (2008) demonstrates under a number of scenarios that longevity annuities maximize guaranteed retirement spending per p ercent in absolute value). Assuming current QLAC premiums, the changes in RRR vary from a decrease of interaction with long-term care costs. S W eh vie le ra p l r p e u vb io liu ca s tE io Bn Rs I o re ns e Qa LrA cC hs h h aa sv a et t a e p m pe pa te re dd t o re m ce on dte ly l s w in itg h le p -a pr rt eim cuilu am r e im mp m he ad siia s to en a fn in na un itc ie ia sl ( p SlP aIn A n si) n a gs f o at r frontier” and provided a case example of how these products could be more effective than a single- 0.5% dos llp ae r c ain fin cu w itia zg ed e. quartile experienced an increase in RRR for all purchases through the 25 percent value and Turner, J. A., & McCarthy, D. D. “Longevity Insurance Annuities in 401(k) Plans and IRAs.” Benefits Quarterly (First 8 0.8 percent for Early Boomers to a decrease of 0.5 percent for Gen Xers. At a premium decrease of 30 least a partial hedge against the longevity risk, given that only a very small percentage of defined retirement. From a public policy perspective however, the question of how to increase demand for this premium immediate annuity (SPIA) for a particular objective function. those in the highest age0 -s .0 p % ecific wage quartile experienced an increase in RRR for all purchases simulated 14 Quarter 2013): 58-62. For those dying at ages 90-94, the increase in RRR is positive for all DIA purchases and the larger purchases Gong and Webb (2007). A pe h ro ce un se t,h R oR ld R ic sh ca on ng se id se vra erd y t fo ro rm un a s d he oc rr te o afs m e o of n 0 ey .1 i n p e th rc is e n m t o fo dr e lE ia f ra ly g g Bro eo gm ate er r se ts o o a un rc ie ns c r in e a rs ee ti r oe fm 0.e 4n p t e ar rc ee n no t t c po ro nd tr u ib ct u t to io a n p (D oC in ) ta w nd h e in re d ia v is d iu gn ailf r ic ea tin rt e m pe e rn ct e n at ca cg oe u n otf ( n IR ew A) rb ea ti lr ae ne cs e s w h ila l v he a v be e e th ni s a t ny n p u e it o izfe ld o n (a gn ed vi t ty h a hte a dn g e Deferred Income Annuity Purchases: Optimal Levels for Retirement (though the 30 per 1c 6ent -l 0 e .5 v% el). h In a 2 ve 0 1 la 4r,g B elr a n in cc h re et a tse s u.s e Td h ia s t urte iln itd y -ib s a re se pd e,a a te nd n u fo itr y - tp hr o e sfe e r d e yn in cg e a m t o ad ge els t 9 o5 a -n 99 al.y z Fe o r t h th eo osp et id m yia n l g f o artm a g o e fs greater 15 for Gen Xers. sufficient to meet average retirement expenditures, defined as a combination of deterministic expenses i rn ec m re aa in ss in lg a rp ge erlc ye u n n ta an ge sw oe f rd ee df.i ned benefit (DB) accruals have been taken as lump-sum distributions when the Income Adequacy Pfau (September 2013). VanDerhei, J., ‘How Much Can Qualifying Longevity Annuity Contracts Improve Retirement Security?’ EBRI -1.0% g th ua an ra 9 n 9 t,e t e h d e i n in cc o rm ea e s e a n in d R fo Ru Rn rd a n th ga et s iftr v oa m ri e 4d .0 s p ue brsc te an nt t if a o llry a a D s Ia A f p uu nr cc tih oa n s e o f e m qu oa d l e tlo a 5 s sp ue m rc p e tn io tn o sf a tn he d 4 re 0t1 ir (e ke ) from the Consumer Expenditure Survey (as a function of age and income) and some health insurance and option was available), the prospect of “out-living” this portion of retirement wealth is a very real risk for Future EBRI analysis will offer additional breakouts of the impact of DIA purchases on the probability of 16 Notes (August 2015) Figure 2 shows the percentage change in Retirement Readiness Ratings that result from using 401(k) Blanchett (2014). -1.5% 19 preferences. He found that nominal SPIAs tended to be the most efficient of the eight annuity types balance to 16.2 percent for a DIA purchase of 30 percent of the 401(k) balance. Two potential scenarios that have been discussed involve adding in-plan QLAC purchases to 401(k) plans. out-of-pocket, health-related expenses, plus stochastic expenses from nursing-home and home-health care many Baby Boomers and Gen Xers. In recent years, the prospect of increasing individual interest in retirement success as a function of alternative demographic categories. We will also include scenarios that account balances attributable to employer contributions with the current employer at age 65 to purchase a -2.0% 17 analyzed; however, if nominal DIA-payout rates increased by just 5 percent, they became the most The first scenario would attempt to convert 15 percent of the 401(k) balance with the current employer B lanchett, (Spring 2015). ( a t l e a . sB t ip ua nrt tiis l a th n e P o plo iciy n t C s eu nc te hr ’e s x C po e m nm se is ss a io rn e o cn o v Re erte ire dm be yn M t S e ed ciu cra itiy d a ).n T dh P is e rv se or nsa io l S na o vf in tg h se a m nd o L do en l g is -T c eo rm ns C tra urc et ed to annuitizing retirement savings at retirement has been enhanced through an insurance product that has include DIA purchases based on IRA balances as well 401(k) balances and will attempt to reprice DIAs if QLAC. The increase in RRR (compared to the baseline of n 17o QLACs) for Early Boomers in the longest relative- When the results are aggregated across all ages at death (the last column in Figure 3), there is an increase in -2.5% attractive option on average. In a 2015 article, Blanchett used regression analysis on the optimal DIA (subject to the appropriate dollar limitation) to a QLAC premium and would simultaneously attempt to simulate retirement income adequacy, as noted above. Alternative versions of the model allow similar 18 Initiative event on Threats to Retirement Security: Longevity, Long-Term Care and Leakage (2014, November been designed to provide monthly benefits only after a significant deferral period in retirement. These discount rates approach “normal” levels. Whether workers responding to the RCS currently have a defined benefit plan is also a factor associated with their interest in longevity quartile with a QLAC is 6.7 percent but it increases to 7.3 percent for Late Boomers and 8.7 RRR for DIA purchases of 5, 10, 15 and 20 percent of the 401(k) balance but purchases of 25 or 30 percent -3.0% allocation for each investor and found evidence that higher allocations would tend to be associated with partially mitigate the risk of purchasing the product when interest rates would be low. This would be 20). Retrieved from http://bipartisanpolicy.org/events/threats-to-retirement-security-longevity-long-term-care-and- analysis for replacement rates, standard-of-living calculations, and other ad hoc thresholds. products could be offered for a small fraction of the cost for a similar monthly benefit through a SPIA and purchasing a QLAC-type product: 45 percent of those without a defined benefit plan were interested in purchasing a QLAC-type percent for Gen Xers. result in a decrease in RRR. those who were younge -3 r. 5 a% nd those who had less existing guaranteed retirement income. accomplished by using a 10-year ladder of purchases based on 1.5 percent of the 401(k) balance each year It is diffic le u alk t a tg oe p / redict the extent to which individual demand for QLACs will increase without an in-plan pro m da un ct y w bh ee lire ev ae s o th na ly t 3 t5 h e p e lo rc w ee nr t o co f t sh t o w se o u wlid th a a t d le ea fis n te p da b re tin ae llfy it m plia tn ig w at ee r e r e in td irie ca etse ’ d r e th lu ec yt w an ec re e it no t e g rie vse t e u dp . control over 5% 10% 15% 20% 25% 30% 20 The baseline version of the model that has been used for this analysis assumes all workers retire at age 65, W fro h m en a t gh ee s p 5r 5e ?m 64 iu .m rates are decreased by 10 percent, the increase in the RRRs varies from 8.4 percent for offering. However, limitations to another approach were eased in October 2014 when the Treasury a large portion of their DC and/or IRA balances at retirement age. 19 Given the large proportion of overall retirement income/wealth generated by Social Security (which lowest age-specific wage T hese scenarios typically include a modification of the current employer liability exposures involved with offering in-plan annuities. . Defined Benefit Plan Freezes: “Who's Affected, How Much, and Replacing Lost Accruals.” EBRI Issue Brief, no. that they immediately begin drawi0 n .2 g% benefits f-r 0o .4 m % Social Se -0 c.u 8% rity and de -1f.i7 n % ed benefi-t 2 .p 7l% ans (if any -3 ).,2 a % nd, to Early Boomers to 11.0 percent for Gen Xers. A 20 percent decrease in premium rates further impacts the D Ee m pap rtlm oe y ne t e iss I un ed t e Nr oe tic se t 2i0 n 1 4 P -6 u 6r (c Lih fea tis m in e Ig n ca om Q e L Pr A oC vid ed Through Target Date Funds in Section 401(k) quartile provides protection against longevity risk) for the lowest age-specific wage quartiles, one would expect that 20 The second proposal assumes (some) plan sponsors would be willing to convert the accumulated value of 291 (Employee Benefit Research Institute, March 2006). the extent that the sum of their expenses and uninsured medical expenses exceed the projected, after-tax IIn n r2 e0 a1 lit 4 y,, o su nc eh o af p tr h o e p m osa alj o w ro c u o ld n s utn ra do in utb st o ed f lu y sn in ee gd t h to is b te y p m e o o diff ip er do td ou d ce ta w l w as it h e lm im in in im au te m d p w re h m en iu m th e re U qu .S ir.e T m re ea ns ts u f rry o m the QLAC range of RRR increases, which vary from 10.7 percent for Early Boomers to 13.5 percent for Gen Xers, while Plans and Other Qualified Defined Contribution Plans) that enables qualified defined contribution plans to second 0.4% 0.3% 0.6% 0.1% -0.5% -1.0% a DIA purchase would be less beneficial for this group inter alia. This hypothesis is supported by the results As part of the 2015 Retirement Confidence Survey (RCS), workers were asked how interested they thought their 401(k) contributions (subject to the applicable dollar and percentage limits) in each employee’s plan to pro av nin du er a sl. iM nc oo re m te h a fr no 2 m 0 p th eo rcs e e n t s o ou f r th ce e s 4 , 0 im 1(k m ) e pd ar ia tit ce ip ly a n b te s g aig n e t so 5 5 w ?i6 th 4 d in r a tw he m EB oR n Ie /Iy C If r 4o 0m 1( kt)h d ea ir ta ib na dsie v iw du ou alld a h cc ao ve u n an ts n ual premiums D a e 3p 0a p re tm rce en ntt a dn ed c rte ha es e In itn e r pn ra elm Rie uv m e n ru at ee S se le rv aid ce s t (o IR R SR ) iR s s in uc er d e f ais ne as l r ra un le gsi n fo g rf r co re m a t 1 in 3g .3 a p q eu rc ae lin fy ti n fo gr lE oa nr g ly e v B it o yo mers provide lifetime income by offering, as investment options, a series of target-date funds (TDFs) that include third i n T F h i g e u .v r “iIe e n w c 4r s e w a e h sxiin p cg h re D s sh e so e fad w u ls itn D t h te h e fe i s irm rs atp la R a te c a0 t tm e . 5 o s e % f n i n D t IA a A u r te p o u m sr o a clth 0 e ic .la 7 y s E % e tn h s ro o b ls ly m e a e o g n fe t J4 - 0 a s 0 .c 5 p 1 k % e ( k V c)ia fP in c la D w n es a r:h g T e e 0h . i4 q e a % u In m a d r p ts a ih lc e o ts o u . n l d S 0 R in m .e 0o % tiilt ra e b r m e te o a n t tt t h S re ia b - v 0 lu a i.n 3 t sg e % ts d they would be at retirement in purchasing an insurance product with a portion of their savings that would a QLAC purchase when the employee reaches retirement age on either an opt-in or opt-out basis for the less than $100 (largely due to short tenure an 2d 5 the ability to start taking in-plan withdrawals without a penalty tax after age 59-½). (defined contribution and cash balance plans, as well as IRAs). If there is sufficient money to pay expenses annuity contract (QLAC) that would be exempt from the required minimum distribution rules that dictate to 16.2 percent for Gen Xers. deferred annuities among their assets. It appears that this will allow 401(k) plan sponsors to offer deferred cotlo u m thn e iS E nu m F cp c ig e lu o sr s ye e i n e 3 P ,B t le a hn n is s e a f w ig t it g h R r e A es g ue a to a tm r ecs a h ta i c Ic n r E s o s ts ic t s a u la t ae ltli o a (n E g.B e ” R s E IB a ),t R td Ih e N ea o E t te h Bs R b , Iu V E t od lc .u a 3 c t3 a e t n gio o o.r n i 9z a e (n E sd m e p R alc e oh s ye e h e ao rB u ce h sn e F e h u fo in t lR d d, e b a sy e n a a yrg c o e h f- Is in tp s se tic tu iftie c, highest age-specific wage begin providing guaranteed monthly income for the rest of the worker’s (or their spouse’s) life at some employee. Of course, there could be several variations on this basic theme including those involving 21 without tapping into the tax-qualif0 ie .2d % individua0 l .a 5% ccounts, th 0o .4s % e balances 0 .a 5% re assumed 0. 5 t% o be invest 0e .5 d % in a distributions from DC plans and IRAs must typically begin by age 70-½ (significantly earlier than the age at annuities as part of the non-equity component of the TDF. EBRI has already performed preliminary analysis This would involve several additional considerations including the status of the QLAC contracts at the time of preretirement job quartile (current) wage quartiles. Wp hre on g r ta h S m ee s c p,h t e o a m f n fb g ic e e e r r i2 n s0 , R 1 t2 r Ru )R .s t fe oe r s a,l ls p ho on us so er hso , lo dr s 2 1 o w tih te hr a s t Q aL ff A . C T h ise s E im mu plla oty ee de i n B e th nie sf istc R en es ae ria o r c u h n I d n e sr t it th ue te c u isr a re nt QLAC point in the future, such as age 80 or 85. Eight pe 9rcent of workers indicated they were very interested and purchase of the QLACs on an annual basis. However, for purposes of the 2015 EBRI research, the non-tax-advantaged account where the investment income is taxed as ordinary income. Individual accounts which payments commence for these products). change. Some have suggested that a lack of cash values for QLACs would have a valuable side effect of helping to reduce leakages at on the potential impact of such a TDF on overall retirement readiness and will include the results in a Percentage of 401(k) balance at age 65 used to purchase a DIA deferring 20 years (no death benefit) prn eo m nip ur m of si,t ,t h ne oy n v pa ar ry ti s fr ao nm , e a d u dc ea ct rie oa ns e a n od f 1 re .5 se p ae rr cc he o nr tg fa on r iE za at rilo yn B e os otm ab elr is sh te od a i n d e W cr a e sa hs in e g o tf o 1 n.,1 D p Ce , ric ne 1 n9 t 7 fo 8r . Gen 30 percent reported they were somewhat interested, while 21 percent said they were not too interested simulations under the second option were performed assuming that the purchases would take place with a are tracked until the point at which they are depleted. At that point, any net housing equity is assumed to job change. f o r t h c.o “m Me in ag su p riu nb gl iR ce attir io em n.e nt Income Adequacy: Calculating Re alistic Income Replacement Rates.” EBRI Issue Brief, All the DIA purchase scenarios where at least 10 percent of the 401(k) balance is used result in a decrease in Xe ErB s. R A I d t o ae 3 s0 n p oe t rtc a e kn et p do elc ic ry e a pso es iit ni o pn rs e,m nio urm ds o , e R sR iR t lv oa blb uy e,s a vd av ro y cfa ro te m s p ae nc iin fic cr e pa os lie c y o f r e 0c .o 2m pe m re ce nn dt a t fo io rn E sa , r o ly r For households currently ages 35-64 who have a 401(k) balance at retirement age (65). and 38 percent said they were not at all interested. Figure 1 in VanDerhei (2015) demonstrates that the W onh ei-lt ei m it e is Q sL tiA llC t o po u r eca h ra ly s e to a t k n ao ge w 6 h 5 o .w It iin s d im ivp id o u ra ta lsn ’ td t e o m n a o n td e f to hr a t t h te hs is e tp yr p o ed o ufc Q tsL a A n C d p tu hr e c h in assu er a w n o cu el d in a dp up slty r y o ’s n ly be added to retirement savings in the form of a lump-sum distribution (not a reverse annuity mortgage 22 RRR for t nh oe . 2 lo 97 w (e E sm t p alg oe y- ese p B ee cin fe ic fi tw R aeg se e a qru ch a rIt nis le ti.t u Tth e,e S se e p cto em nd b e arg 2 e0 -0 s6 p)e . cific wage quartile has an increase in RRR The annuity purchase prices were based on the best rates available at age 65 for a deferred annuity starting at age 85 from Bo ro ec m ee iv re s t fo ed ae n r a in l c fu re na dsie n g o .f 0.7 percent for Gen Xers. 10 Source: EBRI Retirement Security Projection Model® Version 3427 l s te o uv p a e p c l lc o yo fo u if n n Q t te b L rA a elC s a t n o ic n pe tp s io u a n rtc s th rw ia b isu liln te a gv b a e le n Q ttu L oA a t lC h ly -e t m y c p u o e r d r p ie fr y n o t t d h e u e m c t m p ils a o r s y k te e rr o t’ n s f o g cr lo y ln o atn s rs ig b o e u c vt iia ito t ye n a d sn . w n Au in tih y ti e a th s m ,eo r u e it n s it p s so u a n s td e tr e fiu n blt u ’ tt s o a p b m e le o rc d te o e iv l e th de (RAM)). If all the retirement savings are exhausted and if the Social Security and defined-benefit payments f or the 5, 10, 15 and 20 percent DIA purchases before turning into a decrease. The third age-specific wage 11 l d ik ee glrie he o o to d w ofh liic vh in Q g L tA oC asg c ea 8 n5 i.m Np era orv ly e o re nt e ir -h em alfe ( n 4 t7 s e pc eu rc re itn y. t )A o 2 f 0 th 1o 5 sE eB w RI h a or t bie clle iev e m do it d e w ls a s t w “v oe s rc ye ln ika erliy o ”s tu hn ad t er employer contributions with a previous employer are not included in the simulation results are not sufficient to pay expenses, the individual is designated as having run short of money at that point. th quartile has an incr Ee BR aIs e • i1 n 1 0 R 0R 1R 3 fS o t.r N a W ll # D 80 IA 0 p • u W rcah sh ais ne gts o n e , x Dc Ce 2p 00 t0 t 5h e • o (2 n 0e 2 )a 6t 5 9 3 -0 0 6 7 p 0e r •c e w n w tw o .e fb t rh i.o e rg 4 01(k) balance. All 10 8 7 5 1 6 3 4 9 2