A new variational estimate for dynamic reactivity that accounts for delayed neutron holdback is introduced and adapted for use with the improved quasistatic (IQS) method. Numerical tests on a large light water reactor model indicate that the computational effort required with the IQS method can be reduced by a factor of 3 to 4 by using this new variational estimate of dynamic reactivity. With comparable computational effort, the accuracy of the standard IQS method, which uses the flux shape interpolation/recomputation procedure and a first-order estimate of static reactivity, can be improved by using a standard variational estimate without the flux shape interpolation/recomputation procedure, and it can be further improved by using the new variational estimate of dynamic reactivity.