Financial Education and Saving

TitleFinancial Education and Saving
Publication TypeBook Chapter
Year of Publication2004
AuthorsLusardi, A
EditorMitchell, OS, Utkus, S
Book TitlePension Design and Structure: New Lessons from Behavioral Economics
PublisherOxford University Press
KeywordsEducation, Net Worth and Assets, Retirement Planning and Satisfaction
Abstract

In this paper, I examine the financial situation of older households. In addition, I examine whether employers' initiatives to reduce planning costs via retirement seminars have an effect on workers' saving. Using data from the Health and Retirement Study, I first show that many families arrive close to retirement with little or no wealth. Portfolios are also rather simple, and many families, particularly those with low education, hold little or no high-return assets. I further show that seminars foster saving. This is particularly the case for those with low education and those who save little. By offering financial education, both financial and total net worth increase sharply, particularly for families at the bottom of the wealth distribution and those with low education. Retirement seminars also increase total wealth (inclusive of pension and Social Security) for both high and low education families. Taken together, this evidence suggests that retirement seminars can foster wealth accumulation and bolster financial security in retirement.

Notes

RDA 1998-002 ProCite field 6 : In ProCite field 8 : eds.

Endnote Keywords

Financial Management/Retirement Education/Retirement Planning/Education, Financial

Endnote ID

12632

Short TitleFinancial Education and Saving
Citation Key5189