The Impact of Financial Education on Savings and Asset Allocation

TitleThe Impact of Financial Education on Savings and Asset Allocation
Publication TypeReport
Year of Publication2003
AuthorsLusardi, A
InstitutionMichigan Retirement Research Center, Michigan Retirement Research Center
Call Numberwp_2003/Lusardi_wp061.pdf
KeywordsEducation, Net Worth and Assets

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.


RDA 1998-002

Endnote Keywords

Asset allocation/Education, Financial

Endnote ID


Citation Key5562