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An Age-Based, Three Dimensional, Universal Distribution Model Incorporating Sequence Risk

25 Pages Posted: 24 May 2011 Last revised: 11 May 2016

Larry R. Frank Sr.

Academy of Financial Services; Better Financial Education; Certified Financial Planner Board (CFP)

John B. Mitchell

Central Michigan University - Department of Finance and Law

David M. Blanchett

Unified Trust Company, NA

Date Written: April 11, 2011

Abstract

The authors develop an Age-Based Three Dimensional Distribution Model that illustrates a retiree transition from early retirement into later retirement, including superannuated years for the long-lived who continue to survive. The model for this concept development simultaneously: 1) Establishes an age-based distribution model; 2) Incorporates current age life expectancy directly into the model; 3) Addresses survivorship into superannuated ages; 4) Addresses sequence risk to incorporate decisions due to market changes as the retiree ages.

Keywords: Retirement Planning, Adjustable Withdrawal Rates, Sequence Risk, Probability of Failure, Expected Longevity

JEL Classification: D14, D81, D90, G11, G17

Suggested Citation

Frank, Larry R. and Mitchell, John B. and Blanchett, David M., An Age-Based, Three Dimensional, Universal Distribution Model Incorporating Sequence Risk (April 11, 2011). Available at SSRN: https://ssrn.com/abstract=1849983 or http://dx.doi.org/10.2139/ssrn.1849983

Larry R. Frank Sr. (Contact Author)

Academy of Financial Services

La Crosse, WI 54601
United States

HOME PAGE: http://academyfinancial.org

Better Financial Education ( email )

300 Harding Blvd Suite 103D
Roseville, CA 95765
United States
916-303-7777 (Phone)

HOME PAGE: http://www.BetterFinancialEducation.com

Certified Financial Planner Board (CFP) ( email )

1700 Broadway
Suite 2100
Denver, CO 80290-2101
United States

John B. Mitchell

Central Michigan University - Department of Finance and Law ( email )

328 Sloan Hall
Mount Pleasant, MI 48859
989-774-3651 (Phone)

David M. Blanchett

Unified Trust Company, NA ( email )

2353 Alexandria Dr
# 100
Lexington, KY 40504
United States

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