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2015 Conference

del 15 al 16 de October del 2015

Orlando, FL

Welcome to the AFS Conference 2015 Schedule App. Please use the search features to see when your session or poster has been scheduled to take place. 

An Exact, Optimal Strategy for Traditional vs. Roth IRA/401(k) Consumption during Retirement

viernes, el 16 de octubre de 2015 a las 10:50–12:20 EDT
2-Gallery
Keywords: 5 words maximum

optimization, retirement, algorithm, Traditional IRA, Roth IRA

Very short description for use in the program to help attendees understand more than a title can describe

We establish an algorithm that exactly determines a strategy for American retirees to optimally withdraw funds between their tax-deferred accounts and tax-exempt accounts. This optimal strategy can be used to maximize the size of a retiree’s bequest to an heir or, alternatively, to maximize a retiree’s portfolio longevity. We give examples where retirees following the approach currently implemented by major investment firms, like Fidelity and Vanguard, will reduce their bequests compared to our optimal approach. Further, our strategy and algorithm can be applied to any case where the retiree has additional, known yearly sources of money.

Lead & Corresponding Author

James DiLellio, PhD, Pepperdine University
Job Title

Assistant Professor of Decision Sciences

Additional Authors

Dan Ostrov, PhD, Santa Clara University
Job Title

Professor of Applied Mathematics

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