General Session 4:
A Feasible Blueprint for Meeting the Challenges of Funding Retirement Income
Professor Robert Merton will offer an integrated approach to addressing the global retirement funding challenge and its impact on lifetime income/consumption. This session will frame the problem in a six-component approach to solving the challenge in a transparent, modular fashion including the essential design principles for the defined-contribution component. Merton will focus on key retirement income principles that reframe how regulators and the retirement industry need to communicate with employees today, changing the vocabulary from account balance to personal retirement income projections and doing so in a way that employees already think and understand. Merton will also explain how changing from an account balance to retirement income perspective can materially improve both risk management and plan participant decisions, as well as the pivotal role of the 2019 US SECURE Act in making this transition rapid and effective.
Robert C. Merton, PhD, is the School of Management Distinguished Professor of Finance at Massachusetts Institute of Technology, and the John and Natty McArthur University Professor Emeritus at Harvard University. He is currently resident scientist at Dimensional Holdings, Inc., where he is the creator of Target Retirement Solution, a global integrated retirement-funding solution system. Merton received the Alfred Nobel Memorial Prize in Economic Sciences in 1997 for a new method to determine the value of derivatives. He is past president of the American Finance Association, a member of the National Academy of Sciences, and a Fellow of the American Academy of Arts and Sciences. Merton is the author of Continuous-Time Finance and a co-author of Cases in Financial Engineering: Applied Studies of Financial Innovation; The Global Financial System: A Functional Perspective; Finance; and Financial Economics. He also has been recognized for translating finance science into practice. His current research focuses on three areas: (1) lifecycle investing and retirement funding solutions, (2) measuring and monitoring macrofinancial (systemic) risk, and (3) financial innovation and the dynamics of financial institutional change. Merton earned a BS in engineering mathematics from Columbia University, an MS in applied mathematics from California Institute of Technology, and a PhD in economics from MIT; he holds honorary degrees from nineteen universities.
Nobel Memorial Prize in Economic Sciences,1997
First Prize, Roger Murray Prize Competition, Institute for Quantitative Research in Finance
Distinguished Scholar Award, Eastern Finance Association
International INA – Accademia Nazionale dei Lincei Prize National Academy of Lincei, Rome
Financial Engineer of the Year Award, International Association of Financial Engineers
Inducted, Derivatives Hall of Fame, Derivatives Strategy
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