1. SMRE Spring 20081 SMRE Spring 2008 Project An Excel Model to Estimate Expected Remaining Retirement Lifespan By Bruno Trenkler

2. SMRE Spring 2008 2 Introduction Need a simple tool to calculate expected remaining life for retirement planning. Available Tools  Web based estimators  Web based tables Uses publicly available data for  Total Population  Whites Males Females  Blacks Males Females

3. SMRE Spring 2008 3 Methodology Data source is: National Vital Statistics Reports, Vol 54, 14, April 19, 2006 (Revised March 28, 2007) http://www.cdc.gov/nchs/data/nvsr/nvsr54/nvsr54_14.pdf

4. SMRE Spring 2008 4 Survival Plot

5. SMRE Spring 2008 5 Attempts to Model Survivor Function Distribution Analysis  Weibull (coeff = 0.976)  3 parameter Weibull (coeff = 0.985) Transformations  Manual Log, Log-Log, √, inverse √  Box-Cox Polynomial  6 th order provides R 2 =0.9999

6. SMRE Spring 2008 6 Mean Expected Life

7. SMRE Spring 2008 7 Cubic Polynomial Fit

8. SMRE Spring 2008 8 Expected Remaining Life Excel Interface

9. SMRE Spring 2008 9 Polynomial Model vs. Data

10. SMRE Spring 2008 10 Conclusions Modeling survivor function difficult Cubic polynomial gives good results Excel program results are acceptable