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1、 For your convenience Apress has placed some of the front matter material after the index. Please use the Bookmarks and Contents at a Glance links to access them. Contentsforeword ixabout the author xiacknowledgments xiiiintroduction xvchapter 1: How You compare to the Big funds 1chapter 2: asset al
2、location 15chapter 3: investment structure for stocks, Part i 41chapter 4: investment structure for stocks, Part ii 63chapter 5: investment structure for fixed income, Part i 77chapter 6: investment structure for fixed income, Part ii 93chapter 7: investment manager selection 111chapter 8: alternati
3、ve asset classes 131chapter 9: fees and expenses 161chapter 10: risk management 179chapter 11: Putting it all together 197index 201Introductionthe retirement world is generally on a steady march away from traditional pension plans and toward individual retirement responsibility in 401(k)s, Individua
4、l Retirement accounts (IRas), and the like. the fact of the matter is, however, that the average person, who is now responsible for their retirement security, often lacks the tools to manage their assets and future expectations as well as the professional managers of those pension plans are able to
5、do.a variety of studies have been published in recent years that indicate that traditional defined benefit pension plans on average have experienced annual returns that are 1% to 2% higher than defined contribution plans, like 401(k)s and IRas.1 although a 1.5% improvement in the rate of return may
6、not sound like much, $100,000 invested at the rate of 6.0% for a working career of 20 years would have grown by the time of retirement to $320,000; that same $100,000 invested at a rate of 7.5% would have grown by the time of retirement to $425,000. as you can see, that average 1.5% underperformance
7、 of a 401(k) or IRa versus a defined benefit pension plan may sound small, but it can make a very meaningful difference.While some members of the financial press and some political leaders like to blame pension plans for every budgetary and societal ill in the history of the world, maybe this return
8、 advantage indicates that they actually do some things right. Plenty of arguments have been made over the last several years about the high cost of pension plans to corporations and public agencies. However, that cost is at least partially offset by the superior returns of pension plans. In addition
9、, you cant argue about the cost of pension plans without considering the societal cost of replacing pension plans with individual responsibility.this book is not intended, however, to engage in the ongoing political debate over the merits or failures of pension plans versus defined contributions pla
10、ns (I merely will note that other studies have shown that pension plans are actually cheaper than defined contribution plans to reach the same benefit level ).2 I will leave that to the politicians, commentators, and political writers to work out among themselves. Instead, in this book, I will take
11、it as a given 1“Defined Benefit vs. 401(k) Investment Returns: the 2006-2008 update,” towers Watson; and, “Investment Returns: Defined Benefit vs. 401(k) Plans,” Center for Retirement Research at Boston College. 2Beth almeida and William B. Fornia, “a Better Bang for the Buck: the economic efficienc
12、ies of Defined Benefit Pension Plans,” national Institute for Retirement security, 2008.Introduction xvithat the average person is more responsible for their own retirement security than ever before, and I will try to teach that average person about what we as individuals can learn from pension plan
13、s. What do the biggest retirement savers and investors in the country do to generate superior returns at lower costs? Do the better results that pension plans exhibit come from superior asset allocation? Better managers? Lower fees? alternative asset classes? Risk reduction?Yes. all of the above.Pension plans employ all of these tools to generate better returns than the average
