@article {13566, title = {Chances Are Your Financial Future Will Be Determined by This Social Security Table}, year = {2023}, publisher = {The Motley Fool}, keywords = {claiming age, financial behavior, Social Security}, url = {https://www.fool.com/retirement/2023/08/06/financial-future-determined-social-security-table/}, author = {Williams, Sean} } @article {13549, title = {Here{\textquoteright}s the Average Social Security Benefit at Age 62}, year = {2023}, publisher = {The Motley Fool}, keywords = {claiming age, Social Security}, url = {https://www.fool.com/retirement/2023/09/23/heres-the-average-social-security-benefit-age-62/}, author = {Williams, Sean} } @article {13613, title = {How do subjective mortality beliefs affect the value of social security and the optimal claiming ages?}, journal = {International Studies of Economics}, year = {2023}, abstract = {Households that postpone claiming Social Security benefits are, in effect, making additional purchases of the Social Security annuity and acquiring valuable longevity insurance. This paper investigates the impact of plausible variations of subjective mortality beliefs on the value of delayed claiming and the optimal claiming ages of retired workers. Using the Health and Retirement Study data, we show that older individuals could, on average, predict their life expectancy correctly; however, the average variance of age of death calculated from subjective mortality tables is 6.2\%{\textendash}14.4\% lower than that from cohort life tables. Using numerical optimization techniques, we further show that, theoretically, older households place a lower value on delaying claiming when they have greater confidence in their ability to forecast their age of death. But the magnitude of this effect is not large enough to change their optimal claiming ages, unless they hold extreme subjective mortality beliefs. As a result, we conclude that subjective mortality beliefs alone cannot explain the prevalence of early claiming behaviors. {\textcopyright} 2023 The Authors. International Studies of Economics published by John Wiley \& Sons Australia, Ltd on behalf of Shanghai University of Finance and Economics.}, keywords = {Annuity, Life Expectancy, Social Security, subjective mortality beliefs, variance of age of death}, issn = {28313224}, doi = {10.1002/ise3.69}, author = {Dai, Tiantian and Sun, Wei and Webb, Anthony} } @article {aguila_lee_wong_2021, title = {Migration, work, and retirement: the case of Mexican-origin populations}, journal = {Journal of Pension Economics and Finance}, year = {2023}, abstract = {Mexico and the United States both face rapid population aging as well as older populations with high poverty rates. Among the most vulnerable populations of retirement age in either nation are Mexican immigrants to the United States. This work uses data from the U.S. Health and Retirement Study and the Mexican Health and Aging Study to assess retirement decisions among persons born in Mexico and working in either nation as well as such decisions by non-Hispanic Whites in the United States. Social security system incentives matter for the retirement of Mexican immigrants in the U.S. but not for return-migrants in Mexico. }, keywords = {Hispanics, Immigrants, Retirement, Social Security}, doi = {10.1017/S1474747221000342}, author = {Emma Aguila and Lee, Zeewan and Rebeca Wong} } @article {13569, title = {Should You Take Social Security at Age 62, 65, or 70? A Comprehensive Analysis Offers a Very Clear Answer}, year = {2023}, publisher = {The Motley Fool}, keywords = {claiming age, Retirement, Social Security}, url = {https://www.fool.com/retirement/2023/10/07/should-you-take-social-security-at-age-62-65-or-70/}, author = {Williams, Sean} } @article {Ghilarduccijor.2022.1.104, title = {The Illusory Benefit of Working Longer on Retirement Financial Preparedness: Rethinking Advice That Working Longer Increases Retirement Income}, journal = {The Journal of Retirement}, volume = {9}, year = {2022}, abstract = {This article demonstrates that although working longer can, in theory, substantially improve financial preparedness for retirement, it yields much smaller improvements in practice. Multivariate analysis using data from the Health and Retirement Study reveals that working longer improves financial preparedness only for workers who also delay claiming Social Security. But most older workers combine work with Social Security benefits, do not increase their financial wealth, and miss out on the delayed retirement credit. For many, early claiming is a rational choice because their low and often part-time earnings fall short of projected post-retirement income.}, keywords = {financial preparedness, Older workers, Social Security, Working Longer}, issn = {2326-6899}, doi = {10.3905/jor.2022.1.104}, author = {Ghilarducci, Teresa and Papadopoulos, Michael and Webb, Anthony} } @article {10781, title = {Perspectives: The Benefit Receipt Patterns and Labor Market Experiences of Older Workers Who Were Denied Social Security Disability Insurance Benefits on the Basis of Work Capacity}, journal = {Social Security Bulletin}, volume = {80}, year = {2020}, abstract = {This article examines the experiences of Social Security Disability Insurance (DI) applicants aged 51 or older who were initially denied benefits because the disability examiner determined that they could perform either their past work or other work. We use Health and Retirement Study survey data linked to administrative data on benefit application and receipt and earnings from the Social Security Administration. We find that few older DI applicants who were denied benefits on this basis resumed work at a substantial level following denial. More commonly, applicants denied at this stage continued to pursue benefits, often successfully. Nearly two-thirds of initial work capacity-related denials were ultimately allowed DI benefits after appealing the initial decision or reapplying, and our estimates suggest that many of the rest claimed Old-Age and Survivors Insurance benefits before they reached full retirement age.}, keywords = {disability insurance, Social Security}, url = {https://www.ssa.gov/policy/docs/ssb/v80n2/v80n2p25.html}, author = {Jody Schimmel Hyde and April Yanyuan Wu and Gill, Lakhpreet} } @article {BEAUCHAMP2020108995, title = {Is there adverse selection in the U.S. social security system?}, journal = {Economics Letters}, year = {2020}, pages = {108995}, abstract = {Despite facing some of the same challenges as private insurance markets, little is known about the role of adverse selection in Old-Age Social Security. Using data from the Health and Retirement Study, we perform the unused observables version of the positive correlation test, and find robust evidence that people who expect to live shorter lives both choose smaller annuities - by claiming benefits early - and are less costly to insure, implying adverse selection in the system. Results are consistent when using either subjective expectations or observed longevity. Decomposing the sources of adverse selection we find that health, demographics, occupation and financial information together account for much of the positive correlation between mortality and claiming. IV estimates help to rule out moral hazard.}, keywords = {Adverse selection, Optimal policy, Social Security}, issn = {0165-1765}, doi = {https://doi.org/10.1016/j.econlet.2020.108995}, url = {http://www.sciencedirect.com/science/article/pii/S0165176520300318}, author = {Andrew Beauchamp and Mathis Wagner} } @article {10100, title = {The life-changing magic of working a bit longer}, journal = {NerdWallet}, volume = {2019}, year = {2019}, publisher = {NerdWallet}, address = {San Francisco}, keywords = {Financial security, News, Retirement Planning \& Satisfaction, Social Security}, url = {https://www.nerdwallet.com/article/investing/the-life-changing-magic-of-working-a-bit-longer}, author = {Weston, Liz} } @article {10903, title = {The retirement solution hiding in plain sight}, year = {2019}, institution = {Capital One}, address = {Washington, D.C.}, abstract = {Social Security now accounts for about one-third of all income annually received by U.S. retirees, amounting to $1 trillion in annual benefits. While impactful, research consistently finds that the financial effect of Social Security could be even greater if more people waited to enroll, since monthly benefits can increase in value if retirees delay claiming. But, we don{\textquoteright}t know how much is annually lost from households making the sub-optimal decision about when to claim Social Security, how many are making mistakes, or who is making those wrong decisions. To explore these questions, we utilize new technology invented by United Income and data sponsored by the Social Security Administration, finding: Retirees will collectively lose $3.4 trillion in potential income that they could spend during their retirement because they claimed Social Security at a financially sub-optimal time, or an average of $111,000 per household. The average Social Security recipient would receive 9 percent more income in retirement if they made the financially optimal decision about when to claim this retirement benefit. Current retirees will collectively lose an estimated $2.1 trillion in wealth because they made the sub-optimal decision about when to claim Social Security, or an average of $68,000 per household. Most retirees will lose wealth in their 60s and early 70s if they choose to optimize Social Security, but will be wealthier in their late 70s through the rest of their lives. Only 4 percent of retirees make the financially optimal decision about when to claim Social Security. About 57 percent of retirees would build more wealth through their life if they waited to claim until they were 70 years old (when only 4 percent of retirees currently claim), while only 6.5 percent of retirees would have more wealth if they claimed prior to turning 64 (when over 70 percent of retirees currently claim benefits). About 21 percent of those at risk of not affording retirement (or having enough income to cover their expected cost of living) would see an improvement in their chances if they claimed Social Security at the optimal time. Among those retirees at risk that start with a greater than 10 percent chance of affording retirement, 95 percent see their chances of affording retirement improve by an average of 28 percent. Elderly poverty could be cut by nearly 50 percent if all retirees claimed Social Security at the financially optimal time. In particular, about 13 percent of people over the age of 70 are expected to live in poverty at some point, which is estimated to fall to 7 percent if retirees had claimed Social Security at the optimal time {\textendash}a rate that could potentially fall even further if they earned additional income while they waited to claim Social Security. This report finds that nearly no retirees are making the financially optimal decision about Social Security, and that the costs of those mistakes are high for retiring households, particularly those at risk of not being able to afford retirement. In addition, since making the optimal decision means sacrificing wealth in the near-term, we think it is unlikely more people will make the right decision without a policy intervention. There are numerous difficulties associated with solving this problem, though, which will require a thorough and diverse process for addressing. Among the topics for consideration should be the eligibility age range rules, which were last materially modified in 1983. Since 92 percent of retirees are expected to be better off waiting to claim until at least their 65th birthday, claiming before should ideally be an exception for those who demonstrably need to claim benefits before the full retirement age. Means-testing rules may be one way to address this, though an easier place to start would be to change how the Social Security Administration frames claiming age options to the public. Instead of portraying age 62 as the {\textquotedblleft}early eligibility age,{\textquotedblright} for instance, claiming at age 62 could instead be labeled as the {\textquotedblleft}minimum benefit age{\textquotedblright} while age 70 could be labeled as the {\textquotedblleft}maximum benefit age.{\textquotedblright} The Social Security Administration could also be provided with resources to improve utilization of the policy it administers, perhaps in partnership with third-party fiduciaries. With the potential to put $2.1 trillion wealth and $3.4 trillion in income in the pockets of retirees, policymakers should be focused on improving this program.}, keywords = {Decision making, Retirement, Social Security}, url = {https://unitedincome.capitalone.com/library/the-retirement-solution-hiding-in-plain-sight}, author = {Fellows, Matt and Fichtner, Jason and Plews, Lincoln and Whitman, Kevin} } @article {9827, title = {Do Older SSDI Applicants Denied Benefits on the Basis of their Work Capacity Return to Work After Denial?}, number = {2083857692}, year = {2018}, month = {09/2018}, institution = {Princeton}, address = {Princeton, NJ}, abstract = {Key Findings: * Very few older denied SSDI applicants returned to work in the years following denial. * Among those who worked in the years before or after application, average earnings were lower after initial denial relative to before applying for SSDI. * The majority of older SSDI applicants denied on the basis of residual work capacity ultimately receive SSDI before full retirement age (FRA), either after appeal or reapplication. In this issue brief, we document the post-denial employment and benefit experiences of older applicants who are initially denied Social Security Disability Insurance (SSDI) for {\textquotedblleft}work capacity{\textquotedblright} reasons. Specifically, a disability examiner determined that these applicants had a severe impairment, but denied benefits because the applicants{\textquoteright} residual functional capacity allowed them to perform past work or other work. For simplicity, we use {\textquotedblleft}work capacity{\textquotedblright} denials for these cases, though that is not SSA{\textquoteright}s official nomenclature. We follow the experience of older SSDI applicants from the time they receive an initial denial for SSDI benefits through full retirement age (FRA; age 65 or 66, depending on their birth year). The information in this brief highlights findings from a longer manuscript (Schimmel Hyde et al. 2018). Our findings shed light on the types of policies that might be most beneficial to older workers who experience disability onset to remain working and therefore delay claiming Social Security benefits.}, keywords = {Disabilities, Insurance, Social Security, Work}, url = {https://search.proquest.com/docview/2083857692/abstract/40375250D95640A2PQ/1?accountid=14667}, author = {Jody Schimmel Hyde and April Yanyuan Wu} } @article {RePEc:wyi:wpaper:002390, title = {Occupational Retirement and Social Security Reform: the Roles of Physical and Cognitive Health}, year = {2018}, abstract = {Under skill-biased technical change, jobs are becoming less physically demanding whereas require increasing cognitive abilities. However, existing research does not pay sufficient attention on the role of cognitive health in older people{\textquoteright}s labor supply, nor to the occupation-dependent labor supply effects of physical and cognitive health. This paper reveals several facts about the heterogeneity of physical and cognitive health, as well as their relationship with older people{\textquoteright}s labor supply across occupations. Based on these facts, this paper proposes and estimates a dynamic programming structural model of individual retirement and saving decisions. The model allows labor supply effects of physical and cognitive health to differ across occupations via four channels respectively: disutility of working, wage, medical expenditure and life expectancy . I estimate the model with the U.S. Health and Retirement Study data by Indirect Inference. The counterfactual experiments suggest cognitive health has little retirement effect for manual workers. However, for clerical workers, the effect is almost as large as the one of physical health. The counterfactual experiment also reveals the mechanisms through which physical and cognitive health affects labor supply respectively. Finally, this paper quantifies the distributional effects of proposed Social Security changes on retirement, benefits and welfare across occupations.}, keywords = {Cognition, Retirement, Social Security}, url = {https://ideas.repec.org/p/wyi/wpaper/002390.html}, author = {Jiayi Wen} } @article {9227, title = {How the growing gap in life expectancy may affect retirement benefits and reforms}, journal = {The Geneva Papers on Risk and Insurance - Issues and Practice}, volume = {42}, year = {2017}, month = {Jan-07-2017}, pages = {475-499}, keywords = {Life Expectancy, Mortality, Retirement Planning and Satisfaction, Social Security}, issn = {1018-5895}, doi = {10.1057/s41288-017-0057-0}, url = {http://link.springer.com/10.1057/s41288-017-0057-0http://link.springer.com/content/pdf/10.1057/s41288-017-0057-0.pdfhttp://link.springer.com/article/10.1057/s41288-017-0057-0/fulltext.htmlhttp://link.springer.com/content/pdf/10.1057/s41288-017-0057-0.pdf}, author = {Auerbach, Alan and Kerwin K. Charles and Courtney Coile and William G. Gale and Dana P Goldman and Lee, Ronald and Lucas, Charles and Orszag, Peter R. and Sheiner, Louise and Tysinger, Bryan and Weil, David and Wolfers, Justin and Rebeca Wong} } @article {5899, title = {Social Security and Retirement Programs Around the World: The Capacity to Work at Older Ages - Introduction and Summary}, year = {2016}, institution = {Cambridge, MA: National Bureau of Economic Research}, abstract = {This is the introduction and summary to the seventh phase of an ongoing project on Social Security Programs and Retirement Around the World. The project compares the experiences of a dozen developed countries and uses differences in their retirement program provisions to explore the effect of SS on retirement and related questions. The first three phases of this project document that: 1) incentives for retirement from SS are strongly correlated with labor force participation rates across countries; 2) within countries, workers with stronger incentives to delay retirement are more likely to do so; and 3) changes to SS could have substantial effects on labor force participation and government finances. The fourth volume explores whether higher employment among older persons might increase youth unemployment and finds no link between the two. The fifth and sixth volumes focus on the disability insurance (DI) program, finding that changes in DI participation are more closely linked to DI reforms than to changes in health and that reducing access to DI would raise labor supply. This seventh phase of the project explores whether older people are healthy enough to work longer. We use two main methods to estimate the health capacity to work, asking how much older individuals today could work if they worked as much as those with the same mortality rate in the past or as younger individuals in similar health. Both methods suggest there is significant additional health capacity to work at older ages.}, keywords = {Disabilities, Employment and Labor Force, Public Policy, Retirement Planning and Satisfaction, Social Security}, url = {https://www.nber.org/papers/w21939}, author = {Courtney Coile and Kevin Milligan and David A Wise} } @article {8648, title = {Does Social Security Continue to Favor Couples?}, number = {CRR WP 2015-11}, year = {2015}, month = {06/2015}, pages = {1-44}, institution = {Center for Retirement Research at Boston College}, address = {Chestnut Hills, MA}, abstract = {While dramatic increases in women{\textquoteright}s labor supply and earnings have led to a substantial decline in the fraction of women eligible for spouse benefits at retirement, most wives still receive a survivor benefit, as wives still typically have lower earnings than their husbands and live longer. Using the MINT microsimulation model and the HRS data linked with Social Security administrative earnings records, this paper examines the extent to which Social Security continues to favor couples and will do so in the future. The paper finds that while the OASI program still distributes lifetime income from singles to couples, the transfers appear to be shrinking over time. Nevertheless, couples are still projected to have a higher benefit/tax ratio, a lower median net tax rate, and a higher share of them will be receiving positive net transfers from the system as compared to those who are never married or divorced. The increased labor force participation and earnings of women have contributed significantly to the decline in redistribution from men to women, and from singles to couples, while the effect of declining marriage rates has only a modest effect. }, keywords = {Divorce, Marriage, Older Adults, Retirement Planning and Satisfaction, Social Security, Women and Minorities}, url = {http://crr.bc.edu/wp-content/uploads/2015/06/wp_2015-111.pdf}, author = {Nadia S. Karamcheva and April Yanyuan Wu and Alicia H. Munnell} } @article {8639, title = {The Impact of Temporary Assistance Programs on the Social Security Claiming Age}, number = {CRR WP 2015-27}, year = {2015}, pages = {1-331}, institution = {Center for Retirement Research at Boston College}, address = {Chestnut Hill, MA}, abstract = {Delaying claiming past the early eligibility age of 62 has taken on increased importance. Individuals turning 62 with no job and limited income may be able to use temporary assistance programs such as Unemployment Insurance (UI), Medicaid, and the Supplemental Nutrition Assistance Program (SNAP) as sources of support prior to collecting Social Security benefits. To what extent do these programs allow recipients to delay Social Security claiming? The challenge in answering this question stems from the fact that program users{\textquoteright} dire economic straits may make them more likely to claim benefits from both Social Security and these programs, generating a misleading correlation between Social Security claiming and temporary assistance benefits. This paper constructs instruments for program generosity that vary with an individual{\textquoteright}s state of residence but should not reflect the characteristics or circumstances of the individual.}, keywords = {Older Adults, Public Health, Public Policy, Social Security, Welfare}, url = {http://crr.bc.edu/wp-content/uploads/2015/10/wp_2015-27.pdf}, author = {Geoffrey T. Sanzenbacher and April Yanyuan Wu and Matthew S. Rutledge} } @article {VENTI2015133, title = {The long reach of education: Early retirement}, journal = {The Journal of the Economics of Ageing}, volume = {6}, year = {2015}, pages = {133 - 148}, abstract = {The goal of this paper is to draw attention to the long lasting effect of education on economic outcomes. We use the relationship between education and two routes to early retirement {\textendash} the receipt of Social Security Disability Insurance (DI) and the early claiming of Social Security retirement benefits {\textendash} to illustrate the long-lasting influence of education. We find that for both men and women with less than a high school degree the median DI participation rate is 6.6 times the participation rate for those with a college degree or more. Similarly, men and women with less than a high school education are over 25 percentage points more likely to claim Social Security benefits early than those with a college degree or more. We focus on four critical {\textquotedblleft}pathways{\textquotedblright} through which education may indirectly influence early retirement {\textendash} health, employment, earnings, and the accumulation of assets. We find that for women health is the dominant pathway through which education influences DI participation. For men, the health, earnings, and wealth pathways are of roughly equal magnitude. For both men and women the principal channel through which education influences early Social Security claiming decisions is the earnings pathway. We also consider the direct effect of education that does not operate through these pathways. The direct effect of education is much greater for early claiming of Social Security benefits than for DI participation, accounting for 72\% of the effect of education for men and 67\% for women. For women the direct effect of education on DI participation is not statistically significant, suggesting that the total effect may be through the four pathways.}, keywords = {disability insurance, Education, Retirement, Social Security}, issn = {2212-828X}, doi = {https://doi.org/10.1016/j.jeoa.2015.08.001}, url = {http://www.sciencedirect.com/science/article/pii/S2212828X15000201}, author = {Steven F Venti and David A Wise} } @article {5868, title = {Will the Average Retirement Age Continue to Increase?}, year = {2015}, institution = {Boston, MA, Center for Retirement Research at Boston College}, abstract = {Using Health and Retirement Study (HRS) data, this paper examines how changes in individual workers past and present pension coverage, retirement incentives in Social Security, and retiree health insurance have contributed to retirement decisions for the 1931-1953 birth cohorts. It then uses these findings to project retirement behavior for the 1955-1987 cohorts in the Survey of Income and Program Participation (SIPP). A key assumption is that younger cohorts will have no defined benefit (DB) pensions or retiree health coverage in their future jobs. A key limitation is the assumption of a stable relationship in each successive cohort between each factor and labor market decisions.}, keywords = {Employment and Labor Force, Pensions, Retirement Planning and Satisfaction, Social Security}, author = {Matthew S. Rutledge and Gillis, Christopher M. and Anthony Webb} } @article {NBERw20120, title = {Social Security Programs and Retirement Around the World: Disability Insurance Programs and Retirement - Introduction and Summary}, year = {2014}, institution = {NBER}, abstract = {This is the introduction and summary to the sixth phase of an ongoing project on Social Security Programs and Retirement Around the World. The first phase described the retirement incentives inherent in plan provisions and documented the strong relationship across countries between social security incentives to retire and the proportion of older persons out of the labor force. The second phase documented the large effects that changing plan provisions would have on the labor force participation of older workers. The third phase demonstrated the consequent fiscal implications that extending labor force participation would have on net program costs{\textendash}reducing government social security benefit payments and increasing government tax revenues. The fourth phase presented analyses of the relationship between the labor force participation of older persons and the labor force participation of younger persons in twelve countries. We found no evidence that increasing the employment of older persons will reduce the employment opportunities of youth and no evidence that increasing the employment of older persons will increase the unemployment of youth. The fifth phase on "Historical Trends in Mortality and Health, Employment, and Disability Insurance Participation and Reforms" was intended to set the stage for this current phase. This sixth phase of the ongoing ISS project is particularly related to the fifth phase (Wise, 2012) and the second phase (Gruber and Wise, 2004) of the project. This volume continues the focus of the previous volume on DI programs while extending the methodology to study retirement behavior used in the second phase to focus in particular on the effects of the DI programs. The key question this volume seeks to address is: given health status, to what extent are differences in labor force participation across countries determined by the provisions of disability insurance programs?}, keywords = {Social Security}, doi = {10.3386/w20120}, url = {http://www.nber.org/papers/w20120}, author = {Courtney Coile and Kevin Milligan and David A Wise} } @inbook {5259, title = {What Impact Does Old-Age Pension Receipt Have on the Use of Public Assistance Programs Among the Elderly?}, booktitle = {Safety Nets and Benefit Dependence}, year = {2014}, pages = {259-290}, publisher = {Emerald Group Publishing}, organization = {Emerald Group Publishing}, address = {Bingley, UK}, keywords = {Health Conditions and Status, Public Policy, Retirement Planning and Satisfaction, Social Security}, author = {Norma B Coe and April Yanyuan Wu}, editor = {Carcillo, St{\'e}phane and Immervoll, Herwig and Stephen P. Jenkins and K{\"o}nigs, Sebastian and Tatsiramos, Konstantinos} } @article {5967, title = {Estimates of the Potential Insurance Value of Disability Insurance for Individuals with Mental Health Impairments}, year = {2013}, institution = {Ann Arbor, MI, University of Michigan Retirement Research Center}, abstract = {Since the mid-1980s there has been dramatic growth in the number and fraction of DI and SSI beneficiaries with mental illness. With longer life expectancies and younger ages of disability onset than beneficiaries with physical impairments, their growth exerts added fiscal pressure on the programs. While not specifically focused on mental illness, fears of an increase in the duration (and thus prevalence) of disability claims that may result from this demographic shift have generated calls to tighten eligibility rules again. Using data from the Health and Retirement Study linked to SSA administrative records, we created statistically matched control groups of non-beneficiaries with severe mental illness. We then estimated the earnings, income, and health insurance coverage among rejected DI/SSI applicants with mental illness who have characteristics comparable to persons awarded benefits on the basis of mental impairments. We found that even after controlling for health and demographic characteristics, DI beneficiaries were substantially worse off than rejected applicants in terms of wealth and income. While these rejected applicants with mental illness were worse off than those with physical impairments, our findings suggests that the programs successfully select applicants with the greatest income needs,and that retrenchment could result in significant hardship.}, keywords = {Health Conditions and Status, Public Policy, Social Security}, author = {John Bound and Caswell, Kyle J. and Timothy A Waidmann} } @article {5973, title = {How Do the Changing Labor Supply Behavior and Marriage Patterns of Women Affect Social Security Replacement Rates?}, year = {2013}, institution = {Chestnut Hill, MA, Center for Retirement Research at Boston College}, abstract = {This paper seeks to determine the impact of the changing lives of women increased labor force participation/earnings and reduced marriage rates on Social Security replacement rates. First, our estimates, based on the Health and Retirement Study and Modeling Income in the Near Term, show that Social Security replacement rates have dropped sharply at both the household- and individual-level, and the decline will continue for future retirees. Our second finding is that this aggregate change masks a complex relationship between replacement rates and the marital status and income levels of individuals. The decline in replacement rates over time is largest for married couples with husbands whose earnings are in the top tercile. Decomposing the reasons for the overall decline shows that increases in the labor supply and earnings of women explain more than one-third of the change. In contrast, the impact of changing marital patterns is relatively small. Much of the remaining explanation rests with the increased Full Retirement Age and changing claiming behaviors.}, keywords = {Adult children, Employment and Labor Force, Social Security, Women and Minorities}, author = {April Yanyuan Wu and Nadia S. Karamcheva and Alicia H. Munnell and Patrick J. Purcell} } @article {7742, title = {The Disability burden of COPD.}, journal = {COPD}, volume = {9}, year = {2012}, month = {2012 Aug}, pages = {513-21}, abstract = {

Affecting an estimated 12.6 million people and causing over 100,000 deaths per year, chronic obstructive pulmonary disease (COPD) exacts a heavy burden on American society. Despite knowledge of the impact of COPD on morbidity, mortality, and health care costs, little is known about the association of the disease with economic outcomes such as employment and the collection of disability. We quantify the impact of COPD on Americans aged 51 and older-in particular, their employment prospects and their likelihood of collecting federal disability benefits-by conducting longitudinal regression analysis using the Health and Retirement Study. Controlling for initial health status and a variety of sociodemographic factors, we find that COPD is associated with a decrease in the likelihood of employment of 8.6 percentage points (OR = 0.58, 95\% CI 0.50-0.67), from 44\% to 35\%. This association rivals that of stroke and is larger than those of heart disease, cancer, hypertension, and diabetes. Furthermore, COPD is associated with a 3.9 percentage point (OR 2.52, 95\% CI 2.00-3.17) increase in the likelihood of collecting Social Security Disability Insurance (SSDI), from 3.2\% to 7.1\%, as well as a 1.7 percentage point (OR 2.87, 95\% CI 2.02-4.08) increase in the likelihood of collecting Supplemental Security Income (SSI), from 1.0\% to 2.7\%. The associations of COPD with SSDI and SSI are the largest of any of the conditions studied. Our results are consistent with the hypothesis that COPD imposes a substantial burden on American society by inhibiting employment and creating disability.

}, keywords = {Aged, Cost of Illness, Disabled Persons, Employment, Female, Humans, Income, Insurance, Disability, Likelihood Functions, Logistic Models, Male, Middle Aged, Pulmonary Disease, Chronic Obstructive, Social Security, United States}, issn = {1541-2563}, doi = {10.3109/15412555.2012.696159}, author = {Thornton Snider, Julia and J. A. Romley and Ken S Wong and Zhang, Jie and Eber, Michael and Dana P Goldman} } @mastersthesis {6142, title = {Disability Insurance in General Equilibrium}, volume = {Ph.D.}, year = {2012}, school = {University of Virginia}, address = {Charlottesville, VA}, abstract = {The Social Security Disability Insurance (DI) Program, which provides income protection to qualified workers who suffer from disabilities, is now facing rapid growth in the number of recipients. The DI program also discourages exit by workers whose health improves by penalizing work heavily. In the first chapter, I build a dynamic general equilibrium model to provide a quantitative analysis of the welfare effects of the DI program and the impact of DI policy reforms on the program{\textquoteright}s financial health and on worker behavior and welfare. A recently proposed policy to provide two extra years of partial benefits for DI beneficiaries returning to work would reduce the size of the DI beneficiary population, lowering total DI payments and the tax rate and raising welfare of a healthy newborn by 0.33\%. Increasing the Social Security Normal Retirement Age from 65 to 67 raises the number of DI recipients by 8.9\%. Policy changes strengthening the strictness of disability criteria increase social welfare mainly due to the reduction in the tax rate. Lastly, simulation results for the case of eliminating the DI program shows a large welfare gain in the new steady state, implying that the distortionary effects of taxation outweigh the gains from providing insurance. The second chapter takes into consideration that people can also obtain financial protection from public and private health insurance programs to have medical costs covered when they suffer health problems. I build a dynamic general equilibrium model to quantitatively analyze the impact of policy reforms on the DI program and on workers{\textquoteright} behavior and welfare when Medicare, Medicaid, and employer-sponsored health insurance programs interact with the DI program. A policy change strengthening the strictness of the DI admission process increases social welfare mainly due to the reduction in the tax rate and the increase in the wage level. Expanding Medicaid eligibility, which is a provision in the Affordable Care Act, reduces the number of DI recipients by 4.0\% and increases general equilibrium welfare by 0.1\%. However, the welfare effects differ by education.}, keywords = {Disabilities, Event History/Life Cycle, Methodology, Other, Public Policy, Social Security}, author = {Wang, Ruwei} } @article {5921, title = {How Do Subjective Mortality Beliefs Affect the Value of Social Security and the Optimal Claiming Age}, number = {WP$\#$2011-22}, year = {2011}, note = {Copyright - Copyright Social Science Research Network Dec 2011 Language of summary - English ProQuest ID - 913272676 Last updated - 2012-01-02 Place of publication - Rochester Corporate institution author - Sun, Wei; Webb, Anthony DOI - 2551228411; 66534181; 79688; 10.2139/ssrn.1970312; 1970312}, institution = {Center for Retirement Research at Boston College}, address = {Boston, MA}, abstract = {Households that delay claiming Social Security are, in effect, making additional purchases of the Social Security annuity. Theoretical calculations show the delayed claiming is optimal, even for high mortality households. Yet most claim well before the theoretically optimal age. This paper investigates whether subjective mortality beliefs contribute to the prevalence of early claiming. The value of delay depends not only on life expectancy, but also on the degree of uncertainty surrounding the age of death. Using data from the Health and Retirement Study, we show that women approaching retirement understate their probabilities of surviving to age 75 by an average of 10 percentage points, whereas men{\textquoteright}s forecasts are, on average, correct. But both men and women exhibit greater confidence in their ability to forecast their age of death, relative to the predictions of life tables. But these subjective mortality beliefs have little effect on the value of Social Security or the optimal claim age, and cannot explain the prevalence of early claiming. We also find that self-assessed survival probabilities do not predict survival after controlling for health and socio-economic status, indicating a potential for medical underwriting to reduce adverse selection in the annuity market.}, keywords = {Expectations, Health Conditions and Status, Public Policy, Retirement Planning and Satisfaction, Social Security}, url = {https://crr.bc.edu/working-papers/how-do-subjective-mortality-beliefs-affect-the-value-of-social-security-and-the-optimal-claiming-age/}, author = {Wei Sun and Anthony Webb} } @inbook {5236, title = {Fiscal Effects of Social Security Reform in the United States}, booktitle = {Social Security Programs and Retirement around the World}, series = {A National Bureau of Economic Research conference report}, year = {2010}, pages = {503-531}, publisher = {University of Chicago Press}, organization = {University of Chicago Press}, chapter = {12}, address = {Chicago}, keywords = {Other, Public Policy, Social Security}, author = {Courtney Coile and Gruber, Jonathan}, editor = {Gruber, Jonathan and David A Wise} } @article {5803, title = {Personality, Lifetime Earnings, and Retirement Wealth}, year = {2010}, institution = {Michigan Retirement Research Center, University of Michigan}, address = {Ann Arbor, MI}, abstract = {Studies of adolescents and young adults have shown that schooling impacts economic outcomes beyond its impact on cognitive ability. Research has also shown that the personality trait of conscientiousness predicts health outcomes, academic outcomes, and divorce. Using the Big Five taxonomy of personality traits, this study examines whether non-cognitive traits are related to economic success over the life course. Examining Health and Retirement Study survey data linked to Social Security records on over 10,000 adults age 50 and over, we investigate the relationship of personality traits to economic outcomes. Controlling for cognitive ability and background variables, do more conscientious and emotionally stable adults have higher lifetime earnings, and is this due to higher annual earnings, longer work lives, or both? Do more conscientious adults save a higher proportion of their earnings for retirement, and does conscientiousness of each partner in a married couple matter? Do conscientiousness and emotional stability interact such that the effects of conscientiousness are greater among less emotionally stable adults?}, keywords = {Health Conditions and Status, Healthcare, Public Policy, Social Security}, url = {https://ideas.repec.org/p/mrr/papers/wp235.html}, author = {Angela Lee Duckworth and David R Weir and Michigan Retirement Research Center} } @article {5799, title = {The Social Security Early Retirement Benefit as Safety Net}, year = {2010}, institution = {The University of Michigan, Michigan Retirement Research Center}, abstract = {In this paper we used the Health and Retirement Study to examine the health and economic status of those who collect Social Security retirement benefits prior to the full retirement age. We used a propensity score reweighting method to estimate the fraction of early retirees who uses early retirement benefits as a safety net against deteriorating health and who might be induced to apply for disability benefits (SSDI) or retire without income replacement if the generosity or availability of early retirement benefits were reduced. We find that while the majority of early retirees would likely not qualify for disability benefits, approximately one in five have health characteristics similar to SSDI beneficiaries, and thus might not be able to replace losses in benefit income with labor income.}, keywords = {Demographics, Disabilities, Retirement Planning and Satisfaction, Social Security}, author = {John Bound and Timothy A Waidmann and Michigan Retirement Research Center} } @article {5828, title = {Trigger Events and Financial Outcomes Among Older Households}, number = {WP 10-2}, year = {2010}, institution = {Center for Financial Security, University of Wisconsin-Madison}, address = {Madison, WI}, abstract = {Follow a sample of social security beneficiaries drawn from the Health and Retirement Study from their first year of retirement up to 15 years into retirement, we estimate rates at which retirees are subject to family structure change, cognitive decline, health decline, and other events. Then we assess the vulnerability of wealth and wealth-based adequacy measures to adverse events, drawing conclusions about the effect of events on a wealth-based measure and a wealth-based inadequacy measure. Our findings highlight the importance of cognitive and health decline as events with the potential to shape the evolution of wealth post-retirement.}, keywords = {Adult children, Health Conditions and Status, Healthcare, Net Worth and Assets, Social Security}, url = {https://cfs.wisc.edu/2010/09/10/trigger-events-and-financial-outcomes-among-older-households/}, author = {Geoffrey L Wallace and Haveman, Robert and Karen C. Holden and Barbara Wolfe} } @inbook {5229, title = {Work Disability: The Effects of Demography, Health, and Disability Insurance}, booktitle = {Research Findings in the Economics of Aging}, series = {National Bureau of Economic Research conference report}, year = {2010}, pages = {37-58}, publisher = {University of Chicago Press}, organization = {University of Chicago Press}, chapter = {2}, address = {Chicago}, keywords = {Cross-National, Disabilities, Employment and Labor Force, Social Security}, author = {Axel Borsch-Supan}, editor = {David A Wise} } @article {5780, title = {Cross-Wave Prospective Social Security Wealth Measures of Pre-Retirees, Public Release: Data Description and Usage}, year = {2009}, institution = {Institute for Social Research, University of Michigan}, address = {Ann Arbor, Michigan}, abstract = {The Prospective Social Security Wealth Measures of Pre-Retirees data set consists of respondent-level, cross-sectional files constructed from the employment sections of the HRS 1992 (wave 1), HRS 1998 (wave 4), HRS 2004 (wave 7) and the restricted SSA summary and detailed earnings and benefits files. In this public use file, we calculate wealth only for individuals who have not yet retired (as evidenced by claiming SS benefits) (see Section III.C). Each individual is uniquely identified by the concatenation of the household ID and the person number, HHID and PN. We organize the data to match the organization of the RAND HRS data files.}, keywords = {Net Worth and Assets, Social Security}, author = {Kandice Kapinos and Charles Brown and Michael A. Nolte and Helena Stolyarova and David R Weir} } @article {7300, title = {Income Security for Workers}, journal = {Journal of Disability Policy Studies}, volume = {19}, year = {2009}, pages = {204-220}, publisher = {19}, abstract = {The current mix of public and private programs to support workers after they experience disability onset provides benefits to millions of workers and former workers. Yet, despite the large and growing costs of these programs, the inflation-adjusted household incomes of workers with disabilities have been falling for more than two decades, both absolutely and, especially, relative to the incomes of those without disabilities. The aging of the baby boom generation is likely to make matters worse, and the government{\textquoteright}s fiscal circumstance will make it increasingly difficult to sustain existing public programs. Current public policy initiatives might eventually improve the disability support system, but they are not likely to ward off the adverse consequences of the pending crisis. Policy changes that leverage existing private sector practices and capabilities might achieve greater success but have received little attention and are far from proven.}, keywords = {Employment and Labor Force, Insurance, Other, Social Security}, doi = {10.1177/1044207308314949}, author = {David Stapleton and R.V. Burkhauser and Peiyun She and Robert R. Weathers II and Livermore, Gina A.} } @inbook {NBERc4543, title = {Reducing Social Security PRA Risk at the Individual Level: Life-Cycle Funds and No-Loss Strategies}, booktitle = {Social Security Policy in a Changing Environment}, year = {2009}, pages = {255-292}, publisher = {University of Chicago Press}, organization = {University of Chicago Press}, abstract = {Retirement savers in a Social Security system with a personal retirement account (PRA) component would face the challenge of deciding how to allocate their PRA portfolios across a broad range of asset classes and across many different financial products. Asset allocation decisions have important consequences for retirement wealth accumulation because they affect the expenses of investing as well as the risk of low returns. The goal of this chapter is to assess the relative risk associated with alternative asset allocation strategies in PRAs. It also offers insight on the consequences of different asset allocation rules in current private-sector defined contribution (DC) plans, such as 401(k) plans. Quantifying the risk associated with }, keywords = {Social Security}, url = {http://www.nber.org/chapters/c4543}, author = {James M. Poterba and Joshua Rauh and Steven F Venti and David A Wise} } @article {10912, title = {Social security and the retirement and savings behavior of low-income households}, journal = {Journal of Economics}, volume = {145}, year = {2008}, chapter = {21-42}, abstract = {In this paper, we develop and estimate a model of retirement and savings incorporating limited borrowing, stochastic wage offers, health status and survival, social security benefits, Medicare and employer-provided health insurance coverage, and intentional bequests. The model is estimated on a sample of relatively poor households from the first three waves of the Health and Retirement Study (HRS), for whom we would expect social security income to be of particular importance. The estimated model is used to simulate the responses to changes in social security rules, including changes in benefit levels, in the payroll tax, in the social security earnings tax and in early and normal retirement ages. Welfare and budget consequences are estimated.}, keywords = {Retirement, Social Security, structural estimation}, doi = {10.1016/j.jeconom.2008.05.004}, author = {van der Klaauw, Wilbert and Wolpin, Kenneth I.} } @article {5712, title = {When Should Married Men Claim Social Security Benefits?}, number = {IB$\#$8-4}, year = {2008}, institution = {Center for Retirement Research at Boston College}, address = {Boston}, abstract = {Most married men claim Social Security benefits at age 62 or 63, well short of the age that maximizes the expected present value of the average household s benefits. That many married men leave money on the table is surprising. It is also problematic. It results in much lower benefits for surviving spouses and the low incomes of elderly widows are a major social problem. If married men delayed claiming Social Security benefits, retirement income security would significantly improve. This brief focuses on the potential gains from delayed claiming and the factors that may influence claiming behavior. It then considers possible policy responses.}, keywords = {Adult children, Public Policy, Retirement Planning and Satisfaction, Social Security}, url = {https://crr.bc.edu/briefs/when-should-married-men-claim-social-security-benefits/}, author = {Sass, Steven A. and Wei Sun and Anthony Webb} } @article {5691, title = {Managing the Risk of Life}, number = {UM WP 2007-167}, year = {2007}, institution = {Michigan Retirement and Disability Research Center, University of Michigan}, address = {Ann Arbor, MI}, abstract = {This study analyzes the role of individual s and spouse s survival expectations and knowledge about Social Security rules on the expected Social Security claiming age, taking into account the various incentives single and married individuals face. There is substantial heterogeneity in the level of knowledge about SS rules according to demographic characteristics. We find that single men and women who expect to be longlived plan on delaying Social Security claiming. When we allow for differential effects of survival on knowledge about Social Security rules, subjective survivals matter only for single women who are knowledgeable. For single men, knowledge is not so important in their decisions. The claiming decision of married individuals is more complicated, because they are entitled to spouse s and survivor s benefits. Consistent with the incentives provided by Social Security rules, we find that married men base their expected claiming age on their spouse s survival expectations but not on their own survival. For married women, both own and spouse s subjective survivals positively influence the timing of claiming. Knowledge about Social Security rules affects the expected claiming age of both married men and women.}, keywords = {Expectations, Social Security}, url = {https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1082051}, author = {Delavande, Adeline and Robert J. Willis} } @article {10769, title = {Why Do Married Men Claim Social Security Benefits So Early? Ignorance or Caddishness?}, number = {WP$\#$2007-17}, year = {2007}, institution = {Center for Retirement Research at Boston College}, abstract = {Most married men claim Social Security benefits at age 62 or 63, well short of both Social Security{\textquoteright}s Full Retirement Age and the age that maximizes the household{\textquoteright}s expected present value of benefits (EPVB). This results in a loss of less than 4 percent in household EPBV. But essentially the entire loss is borne by the survivor benefit, falls nearly 20 percent. As many elderly widows have very low incomes, early claiming by married men is a major social problem. Regression results found no association between early claiming and caddishness or the ability of husbands to make claiming decisions independently. The one statistically significant finding is the association of college education and later claiming, which cautiously take to indicate greater financial awareness. This suggests that an effective educational campaign might be able to raise the claiming ages of married men and improve widows{\textquoteright} retirement income security. But financial education has not been especially effective in changing behavior. Policymakers should thus consider other initiatives to assure a survivor benefit greater than that produced by an age 62 or 63 husbands{\textquoteright} claiming age. Such initiatives include raising the Earliest Eligibility Age, requiring spousal consent for claiming prior to the Full Retirement Age, and preserving the survivor benefit at its Full Retirement Age value and allowing the higher-earning spouse to access only a portion of his (or her) Primary Insured Amount prior to the Full Retirement Age.}, keywords = {Social Security, Social Security Benefits}, url = {https://crr.bc.edu/working-papers/why-do-married-men-claim-social-security-benefits-so-early-ignorance-or-caddishness/}, author = {Anthony Webb and Wei Sun and Sass, Steven A.} } @article {5662, title = {Probabilistic Thinking and Early Social Security Claiming}, year = {2006}, institution = {The University of Michigan, Michigan Retirement Research Center}, abstract = {This study analyzes the extent to which an individual.s survival expectations influence his or her decision to claim social security benefits at an early age. We find that subjective survival probabilities capture meaningful behavioral responses to incentives for early Social Security claiming when they are purged of measurement error using risk factors as instruments. Among people who are still working at age 62, those who expect to live longer are likely to delay claiming of Social Security benefits to a degree that is both statistically and economically significant.}, keywords = {Methodology, Retirement Planning and Satisfaction, Social Security}, url = {http://www.mrrc.isr.umich.edu/publications/papers/}, author = {Delavande, Adeline and Michael M. Perry and Robert J. Willis} } @article {5624, title = {Social Security and the Retirement and Savings Behavior of Low Income Households}, year = {2005}, note = {RDA}, institution = {Penn Institute for Economic Research, University of Pennsylvania}, abstract = {In this paper, we develop and estimate a model of retirement and savings incorporating limited borrowing, stochastic wage offers, health status and survival, social security benefits, Medicare and employer provided health insurance coverage, and intentional bequests. The model is estimated on sample of relatively poor households from the first three waves of the Health and Retirement Study (HRS), for whom we would expect social security income to be of particular importance. The estimated model is used to simulate the responses to several counterfactual experiments corresponding to changes in social security rules. These include changes in benefit levels, in the payroll tax, in the social security earnings tax and in early and normal retirement ages.}, keywords = {Consumption and Savings, Social Security}, url = {https://papers.ssrn.com/sol3/papers.cfm?abstract_id=719982}, author = {van der Klaauw, Wilbert and Wolpin, Kenneth I.} } @inbook {5132, title = {What People Don{\textquoteright}t Know About Their Pensions and Social Security: An Analysis Using Linked Data from the Health and Retirement Study}, booktitle = {Public Policies and Private Pensions}, year = {2003}, note = {RDA 1996-005ProCite field[8]: eds.}, pages = {57-125}, publisher = {Brookings Institution}, organization = {Brookings Institution}, address = {Washington, DC}, abstract = {Pension plan descriptions from respondents to the 1992 Health and Retirement Study are compared with descriptions obtained from their employers. Earnings histories reported by respondents are compared with earnings histories from the Social Security Administration. The probability of linking employer pension data, which is two thirds for current jobs, and of obtaining permission to link an earnings history, which is over 70 percent, are not well explained by respondent characteristics. Half of respondents with linked pension data correctly identify plan type, and fewer than half identify, within one year, dates of eligibility for early and normal retirement benefits. Benefit reduction rates are essentially not reported. Respondents do better in reporting pension values, but the unexplained variation is still considerable. In contrast, respondent reported values together with other observables, account for 80 percent of the variation in pension values and 75 percent of the variation in covered earnings measured from linked records. Thus prospects are good for imputing plan values, but not for imputing the location or size of early retirement incentives. Our findings raise questions about how well respondents understand complex pension and Social Security rules.}, keywords = {Consumption and Savings, Employment and Labor Force, Income, Pensions, Retirement Planning and Satisfaction, Social Security}, url = {https://www.nber.org/papers/w7368}, author = {Alan L Gustman and Thomas L. Steinmeier}, editor = {William G. Gale and John B. Shoven and Mark J. Warshawsky} } @article {6818, title = {How Policy Variables Influence the Timing of Social Security Disability Insurance Applications}, journal = {Social Security Bulletin}, volume = {64}, year = {2002}, note = {RDA}, pages = {52-83}, publisher = {64}, abstract = {This article analyzes the impact of policy variables{\textemdash}employer accommodations, state Social Security Disability Insurance (DI) allowance rates, and DI benefits{\textemdash} on the timing of an application for DI benefits by workers with a work-limiting health condition starting when their health condition first begins to bother them. The analysis uses a rich mixture of personal and employer characteristics from the Health and Retirement Study linked to Social Security administrative records. }, keywords = {Disabilities, Social Security}, url = {https://www.ssa.gov/policy/docs/ssb/v64n1/v64n1p52.pdf}, author = {R.V. Burkhauser and Butler, J.S. and Robert R. Weathers II} } @article {5525, title = {Modeling Income in the Near Term: Revised Projections of Retirement Income Through 2020 for the 1931-1960 Birth Cohorts}, year = {2002}, note = {RDA 1998-006}, institution = {The Urban Institute}, address = {Washington, D.C.}, abstract = {The Division of Policy Evaluation (DPE) of the Social Security Administration (SSA) has entered into two contracts with the Urban Institute to help it develop a new tool for analyzing the distributional consequences of Social Security reform proposals. The first, awarded in 1998, led to the development of Modeling Income in the Near Term (MINT), a tool for simulating the retirement incomes of members of the Baby Boom and neighboring cohorts. The second, awarded in 2000, was to expand and improve on the first version of MINT. In all phases of the project, members of the research staff at SSA/DPE collaborated closely with the contractors. The Brookings Institution served as a subcontractor to the Urban Institute under both contracts and the RAND Corporation participated in the development of the initial version of MINT under a separate contract. This report describes the work of the researchers at Urban and Brookings under the second contract.}, keywords = {Disabilities, Net Worth and Assets, Pensions, Social Security}, url = {http://www.urban.org/UploadedPDF/410609_ModelingIncome.pdf}, author = {Toder, Eric and Thompson, Lawrence H. and Melissa Favreault and Richard W. Johnson and Perese, Kevin and Ratcliffe, Caroline and Karen E. Smith and Cori E. Uccello and Timothy A Waidmann and Berk, Jillian and Woldemariam, Romina and Gary T. Burtless and Claudia R Sahm and Douglas A. Wolf} } @article {6717, title = {Saver Behavior and 401(k) Retirement Wealth}, journal = {American Economic Review}, volume = {90}, year = {2000}, note = {RDA 1999-002}, pages = {297-302}, publisher = {90}, abstract = { Contributions to 401(k) plans are now the most important form of retirement saving. Since 401(k) plans were introduced in the early 1980{\textquoteright}s, they have expanded rapidly and continuously. By 1998, roughly half of all households were eligible to participate in 401(k) plans, and more than 36 million workers made contributions to these employer-provided saving plans. In 1995, the last year for which the U.S. Department of Labor has released definitive data, 401(k) contribu- tions amounted to $87.4 billion, or 55 percent of all contributions to employer-sponsored pension plans. The level of contributions, and their share of all pension contributions, is probably signifi- cantly higher today. The spread of 401(k) plans is the most important indicator of the move to personal retirement saving. In 1980, almost 92 percent of pension-plan contributions were to tradi- tional employer-provided plans, and about 64 percent of these contributions were to conventional defined-benefit plans. Today, almost 60 percent of contributions are to personal retirement accounts, including 401(k), IRA, and Keogh plans. Including employer- provided, non-40 1 (k) defined-contribution plans, over 76 percent of contributions are to plans that are controlled in large measure by individuals. These individuals make partici- pation, contribution, asset-allocation, and withdrawal decisions. In this paper, we describe the likely impor- tance of 401(k) assets for future older Ameri- cans and the effect of investment decisions on asset accumulation. We also examine the extent to which retirement assets may be affected by several decisions: preretirement withdrawals, management fees and expenses, contribution rates, and early retirement. Our analysis focuses on 401(k) saving, but applies more broadly to other forms of individual retirement saving.}, keywords = {Consumption and Savings, Net Worth and Assets, Pensions, Retirement Planning and Satisfaction, Social Security}, url = {https://www.jstor.org/stable/117239?seq=1}, author = {James M. Poterba and Steven F Venti and David A Wise} } @mastersthesis {6147, title = {Essays in Applied Microeconometrics}, year = {1999}, month = {1999}, school = {Syracuse University}, abstract = {This dissertation consists of three essays in applied microeconometrics. In the first essay, I use retrospective data from the Health and Retirement Study (HRS) together with matching state level data on SSDI allowance rates and individual level Social Security administrative record data on the generosity of SSDI benefits to examine how the Social Security Disability Insurance program affects a person{\textquoteright}s work behavior following the onset of a disability. A hazard model that allows for both measured and unmeasured heterogeneity is used to estimate the relative importance of policy variables--employer accommodation as well as the relative value and likelihood of acceptance onto the SSDI program--on the timing of SSDI application following the onset of a disability. The results show that employer accommodation significantly slows a worker{\textquoteright}s application for SSDI benefits while easier access to SSDI benefits and more generous SSDI benefits increase the speed of application following the onset of a health condition. In the second essay, I develop three approaches that may be used to obtain consistent estimates of the structural parameters in the fixed effects ordered logit model. The first approach uses the adjacent categories form of the ordered logit along with the conditional logit and minimum distance estimator to obtain estimates of the structural parameters. In a second step, the Generalized Method of Moments (GMM) is used to estimate the sum of the limit parameters and the fixed effects, and finally the limits are estimated based on the means of the sums. The other approaches interpret fixed effects as random effects. The second approach specifies the fixed effects as omitted variables that raise the variance of the disturbance and bias the logit estimates. A generated regressor is created to allow the bias to be corrected. The third approach generalizes a new method of estimation for the fixed effects logit model to the ordered logit. Specification tests are extended to these estimators and a Monte Carlo experiment is constructed to test the small sample properties of the estimator. The third essay uses data from the Panel Study of Income Dynamics (PSID) to examine how experience with entrepreneurship--defined as persons who are self-employed--has affected an individual{\textquoteright}s place in the earnings distribution. The strategy is to follow individuals{\textquoteright} positions in the income distribution over time, and to see how their mobility was affected by involvement with entrepreneurship. The results show that for low-income individuals there is some merit to the notion that the self-employed moved ahead in the earnings distribution relative to those who remained wage earners. On the other hand, for those at the upper end of the earnings distribution, those who became self-employed often advanced less in the earnings distribution than their wage and salary counterparts.}, keywords = {Demographics, Disabilities, Employment and Labor Force, Methodology, Social Security}, author = {Robert R. Weathers II} } @inbook {5152, title = {Pension and Social Security Wealth in the Health and Retirement Study}, booktitle = {Wealth, Work and Health: Innovations in Measurement in the Social Sciences}, year = {1999}, note = {RDA 1996-005; Revision of Pension Research Council Working Paper PRC WP 97-3 ProCite field 8 : eds.}, pages = {150-208}, publisher = {University of Michigan Press}, organization = {University of Michigan Press}, address = {Ann Arbor, MI}, abstract = {This study attempts to understand the impact of pension and social security wealth on decisions made by people of retirement age. Their in-depth analysis of the Health and Retirement Study gives many interesting findings. Of those people participating in the Health and Retirement Study, more then half of the wealth is in the form of social security, pensions, and health insurance. Various topics are explored in this paper.}, keywords = {Net Worth and Assets, Pensions, Social Security}, author = {Alan L Gustman and Olivia S. Mitchell and Andrew A. Samwick and Thomas L. Steinmeier}, editor = {James P Smith and Robert J. Willis} }