TY - CHAP T1 - Disability-free life trends at older ages: Implications for longevity risk management T2 - New Models for Managing Longevity Risk: Public-Private Partnerships Y1 - 2022 A1 - Douglas A. Wolf A1 - Olivia S. Mitchell KW - Activities of Daily Living KW - Disability JF - New Models for Managing Longevity Risk: Public-Private Partnerships PB - Oxford University Press SN - 978–0–19–285980–8 ER - TY - CHAP T1 - Does working longer enhance old age? T2 - New Models for Managing Longevity Risk: Public-Private Partnerships Y1 - 2022 A1 - Maria D Fitzpatrick A1 - Olivia S. Mitchell KW - health KW - Retirement KW - working JF - New Models for Managing Longevity Risk: Public-Private Partnerships PB - Oxford University Press SN - 978–0–19–285980–8 ER - TY - JOUR T1 - Income trajectories in later life: Longitudinal evidence from the Health and Retirement Study JF - The Journal of the Economics of Ageing Y1 - 2022 A1 - Olivia S. Mitchell A1 - Robert L. Clark A1 - Annamaria Lusardi KW - Aging KW - Financial literacy KW - Financial resilience KW - Vulnerable groups AB - We track low-income respondents in the longitudinal Health and Retirement Study for 23 years, to observe how their financial situations unfolded as they aged. We document that (a) real incomes remained relatively stable as individuals entered retirement and progressed through their later years; and (b) labor force participation declined and thus earnings became less important with age, while Social Security and retirement savings rose as a proportion of annual income. Low-income people near retirement also tended to fare poorly during retirement. VL - 22 ER - TY - CHAP T1 - Perceptions of Mortality: Individual assessment of longevity risk T2 - New Models for Managing Longevity Risk: Public-Private Partnerships Y1 - 2022 A1 - Kathleen McGarry A1 - Olivia S. Mitchell KW - Life Expectancy KW - Mortality KW - Survival JF - New Models for Managing Longevity Risk: Public-Private Partnerships PB - Oxford University Press SN - 978–0–19–285980–8 ER - TY - JOUR T1 - How Financial Literacy Shapes the Demand for Financial Advice at Older Ages JF - The Journal of the Economics of Ageing Y1 - 2021 A1 - Kim, Hugh H. A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - financial advice KW - Financial literacy KW - Financial Management AB - We investigate how financial literacy shapes older Americans’ demand for financial advice. Using an experimental module fielded in the Health and Retirement Study, we show that financial literacy strongly improves the quality but not the quantity of financial advice sought. In particular, more financially literate people seek financial help from professionals. This effect is more pronounced among older people and those with more wealth and more complex financial positions. Our analysis result implies that financial literacy and financial advisory services are complementary with, rather than substitutes for, each other. VL - 20 SN - 2212-828X ER - TY - JOUR T1 - Older peoples' willingness to delay social security claiming JF - Journal of Pension Economics and Finance Y1 - 2021 A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Annuity KW - Labor Supply KW - lump sum KW - Retirement Age KW - Social Security AB - We have designed and implemented an experimental module in the 2014 Health and Retirement Study to measure older persons' willingness to defer claiming of Social Security benefits. Under the current system’ status quo where delaying claiming boosts eventual benefits, we show that 46% of the respondents would delay claiming and work longer. If respondents were instead offered an actuarially fair lump sum payment instead of higher lifelong benefits, about 56% indicate they would delay claiming. Without a work requirement, the average amount needed to induce delayed claiming is only $60,400, while when part-time work is stipulated, the amount is slightly higher, $66,700. This small difference implies a low utility value of leisure foregone, of under 20% of average household income. VL - 20 IS - 3 ER - TY - RPRT T1 - What Explains Low Old-Age Income? Evidence from the Health and Retirement Study Y1 - 2021 A1 - Olivia S. Mitchell A1 - Clark, Robert L. A1 - Annamaria Lusardi KW - Income KW - retirement savings KW - Social Security AB - We examine respondents in the Health and Retirement Study (HRS) to observe how their financial situations unfolded as they aged. We focus on low income older adults and follow them over time to identify the factors associated with having low income at baseline and thereafter. We find that (a) real income remained relatively stable as individuals approach and enter retirement, and progress through their retirement years, and (b) labor force participation declined and thus earnings became less important with age, while Social Security and retirement savings rose as a proportion of annual income. JF - NBER Working Paper PB - National Bureau of Economic Research CY - Cambridge, MA ER - TY - JOUR T1 - Debt and Financial Vulnerability on the Verge of Retirement JF - Journal of Money, Credit and Banking Y1 - 2020 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Oggero, Noemi KW - Personal finance KW - retirement plans AB - Abstract We analyze older individuals’ debt and financial vulnerability using data from the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS). In the HRS, we compare three groups of people age 56–61 in 1992, 2004, and 2010, to assess cross-cohort changes in debt over time. Two waves of the NFCS (2012 and 2015) provide additional insights into debt management and older individuals’ capacity to shield themselves against shocks. We conclude that recent cohorts hold more debt and face more financial insecurity than in the past. This will render them particularly vulnerable to forecasted interest rate increases. VL - 52 IS - 5 ER - TY - JOUR T1 - Financial Fraud Among Older Americans: Evidence and Implications JF - JOURNALS OF GERONTOLOGY SERIES B-PSYCHOLOGICAL SCIENCES AND SOCIAL SCIENCES Y1 - 2020 A1 - DeLiema, Marguerite A1 - Deevy, Martha A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Financial literacy KW - Health and Retirement Study KW - Investment fraud KW - Lottery scam AB - Objectives: The consequences of poor financial capability at older ages are serious and include making mistakes with credit, spending retirement assets too quickly, and being defrauded by financial predators. Because older persons are at or past the peak of their wealth accumulation, they are often the targets of fraud. Methods: Our project analyzes a module we developed and fielded on people aged 50 an older years in the 2016 Health and Retirement Study (HRS). Using this data set, we evaluated the incidence and prospective risk factors (measured in 2010) for investment fraud and prize/lottery fraud using logistic regression (N = 1,220). Results: Relatively few HRS respondents mentioned any single form of fraud over the prior 5 years, but 5.0% reported at least one form of investment fraud and 4.4% recounted prize/lottery fraud. Greater wealth (nonhousing) was associated with investment fraud, whereas lower housing wealth and symptoms of depression were associated with prize/lottery fraud. Hispanics were significantly less likely to report either type of fraud. Other suspected risk factors-low social integration and financial literacy-were not significant. Discussion: Fraud is a complex phenomenon and no single factor uniquely predicts victimization across different types, even within the category of investment fraud. Prevention programs should educate consumers about various types of fraud and increase awareness among financial services professionals. VL - 75 IS - 4 ER - TY - JOUR T1 - Narrow framing and long‐term care insurance JF - Journal of Risk and Insurance Y1 - 2020 A1 - Gottlieb, Daniel A1 - Olivia S. Mitchell KW - Finances KW - Long-term care insurance AB - We propose a model of narrow framing in insurance and test it using data from a new module we designed and fielded in the Health and Retirement Study. We show that respondents subject to narrow framing are substantially less likely to buy long-term care insurance than average. This effect is much larger than the effects of risk aversion or adverse selection, and it offers a new explanation for why people underinsure their later-life care needs. VL - 84 IS - 4 JO - Journal Risk and Insurance ER - TY - RPRT T1 - Understanding Debt in the Older Population Y1 - 2020 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Oggero, Noemi KW - Debt KW - financial fragility KW - Financial literacy KW - Mortgages KW - Retirement KW - student loans AB - Poor financial capability can have important consequences for well-being in later life. To explore aspects of financial management related to debt, we have designed and analyzed a new module in the 2018 Health and Retirement Study along with information from the 2018 National Financial Capability Study to evaluate the factors associated with debt and debt management in later life. We show that, even for older Americans, student loans and unpaid medical bills represent a large proportion of their debt, and having children also contributes to their indebtedness. By contrast, the more financially literate have more positive financial perceptions and behaviors. Specifically, being able to answer one additional financial literacy question correctly is associated with a higher probability (3-6 percentage points) of reporting an above average credit record and planning for retirement. Clearly, financial knowledge can help limit debt exposure at older ages. JF - Pension Research Council Working Paper PB - University of Pennsylvania CY - Philadelphia UR - https://repository.upenn.edu/prc_papers/575/ ER - TY - RPRT T1 - How cognitive ability and financial literacy shape the demand for financial advice at older ages Y1 - 2019 A1 - Hugh Hoikwang Kim A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Cognition & Reasoning KW - Financial literacy KW - Social Support AB - We investigate how cognitive ability and financial literacy shape older Americans’ demand for financial advice using an experimental module in the 2016 Health and Retirement Study. We show that cognitive ability and financial literacy strongly improve the quality, but not the quantity, of financial advice sought. Most importantly, the financially literate and more cognitively able tend to seek financial help from professionals rather than family members, and they are less likely to accept so-called ‘free’ financial advice that may entail conflicts of interest. Nevertheless, those with higher cognitive function also tend to distrust financial advisors, leading them to eschew their services. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w25750.pdf ER - TY - JOUR T1 - Time discounting and economic decision-making in the older population JF - The Journal of the Economics of Ageing Y1 - 2019 A1 - Huffman, David A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Decision making KW - Retirement Planning and Satisfaction KW - Self-control AB - This paper examines heterogeneity in time discounting among a representative sample of elderly Americans, as well as its role in explaining key economic behaviors at older ages. We show how older Americans evaluate simple (hypothetical) inter-temporal choices in which payments today are compared with payments in the future. Using the indicators derived from this measure, we then demonstrate that differences in discounting patterns are associated with characteristics of particular importance in elderly populations. For example, cognitive deficits are associated with greater impatience, whereas bequest motives are associated with less impatience. We then relate our discounting measure to key economic outcomes and find that impatience is associated with lower wealth, fewer investments in health, and less planning for end of life care. VL - 14 UR - http://www.sciencedirect.com/science/article/pii/S2212828X16300457 JO - The Journal of the Economics of Ageing ER - TY - JOUR T1 - The Changing Face of Debt and Financial Fragility at Older Ages JF - AEA Papers and Proceedings Y1 - 2018 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Oggero, Noemi KW - Debt KW - Finances KW - Financial security KW - Homeownership KW - Retirement Planning and Satisfaction AB - We investigate changes in older individuals' financial fragility as they stand on the verge of retirement. Using data from the Health and Retirement Study (HRS), we compare how debt has changed for successive cohorts of people age 56-61. Our analysis shows that recent older Americans close to retirement hold more debt, and hence face greater financial insecurity, than earlier generations. This is primarily due to having bought more expensive homes with smaller down payments. We discuss possible policy implications. VL - 108 ER - TY - RPRT T1 - Exploring the Risks and Consequences of Elder Fraud Victimization: Evidence from the Health and Retirement Study Y1 - 2018 A1 - DeLiema, Marguerite A1 - Deevy, Martha A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Crime KW - Elder fraud KW - Gender Differences KW - Risk Factors AB - This is the first study to use longitudinal data to explore both the antecedents and consequences of fraud victimization in the older population. Because older persons are close to or past the peak of their wealth accumulation, they are often the targets of fraud. This paper reports on analysis of the Leave Behind Questionnaires (LBQs) fielded on Health and Retirement Study (HRS) respondents over three survey waves in 2008, 2010, and 2012. We evaluate the demographic determinants and risk factors of reporting financial fraud victimization in the survey, and explore whether there are demographic subgroups of older victims. In addition, we examine the financial, physical and psychological consequences of fraud. Overall results suggest that there is no single reliable predictor of fraud victimization across all three LBQ samples. When LBQ responses were pooled across survey years, we found that younger, male, better-educated, and depressed persons reported being defrauded significantly more often. Victimization was associated with lower nonhousing wealth in the combined sample controlling for other factors, but had no measurable impact on cognitive, psychological, or physical health outcomes. Future research should examine predictors and outcomes based on the type of financial fraud experienced and the amount of money lost. JF - Michigan Retirement Research Center PB - Michigan Retirement Research Center, Institute for Social Research, University of Michigan CY - Ann Arbor, MI UR - http://mrrc.isr.umich.edu/wp374/ ER - TY - RPRT T1 - Financial Fraud among Older Americans: Evidence and Implications Y1 - 2018 A1 - DeLiema, Marguerite A1 - Deevy, Martha A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Finances KW - Fraud KW - Risk Factors AB - The consequences of poor financial capability at older ages are serious and include making mistakes with credit, spending retirement assets too quickly, and being defrauded by financial predators. Because older persons are at or past the peak of their wealth accumulation, they are often the targets of fraud. Our project analyzes a module we developed and fielded in the 2016 Health and Retirement Study (HRS). Using this dataset, we evaluate the incidence and risk factors for investment fraud, prize/lottery scams, and account misuse, using regression analysis. Relatively few HRS respondents mentioned any single form of fraud over the prior five years, but nearly 5% reported at least one form of investment fraud, 4 % recounted prize/lottery fraud, and 30% indicated that others had used/attempted to use their accounts without permission. There were few risk factors consistently associated with such victimization in the older population. Fraud is a complex phenomenon and no single factor uniquely predicts victimization. The incidence of fraud could be reduced by educating consumers about various types of fraud and by increasing awareness among financial service professionals. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w24803.pdf ER - TY - NEWS T1 - Innovations in Finance (A Special Report) - Experts' Voices: Why Elder Financial Fraud Is Worse Than We Thought T2 - The Wall Street Journal Y1 - 2018 A1 - Olivia S. Mitchell JF - The Wall Street Journal CY - New York City ER - TY - RPRT T1 - What the Health and Retirement Study Tells Us About Cognitive Ability, Financial Literacy, and the Demand for Financial Advice at Older Ages Y1 - 2018 A1 - Hugh Hoikwang Kim A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Cognitive Ability KW - Decision making KW - Financial literacy AB - Cognitive ability and financial literacy can have an indeterminate effect on older persons’ financial behavior. Older investors who recognize that their capacity to manage financial assets is diminished would rationally delegate the task to others. But those who mistakenly believe their acumen remained intact might continue managing their money themselves. This study examines the ambiguous influence of cognitive ability and financial literacy at older ages to gauge their impact on demand for, and use of, financial advice. JF - Trends and Issues PB - TIAA Institute CY - New York City UR - https://www.tiaainstitute.org/publication/what-health-and-retirement-study-tells-us-about-cognitive-ability ER - TY - ICOMM T1 - Why Making Big Decisions as We Get Older Is So Risky Y1 - 2018 A1 - Olivia S. Mitchell KW - Decision making KW - News KW - Op-ed KW - Risk Factors JF - Dow Jones Institutional News PB - Dow Jones CY - New York City VL - 2018 ER - TY - RPRT T1 - Debt and Financial Vulnerability on the Verge of Retirement Y1 - 2017 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Oggero, Noemi KW - Consumption and Savings KW - Debt KW - Retirement Planning and Satisfaction AB - We analyze older individuals’ debt and financial vulnerability using data from the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS). Specifically, in the HRS we examine three different cohorts (individuals age 56-61) in 1992, 2004, and 2010 to evaluate cross-cohort changes in debt over time. We also use two waves of the NFCS (2012 and 2015) to gain additional insights into debt management and older individuals’ capacity to shield themselves against shocks. We show that recent cohorts have taken on more debt and face more financial insecurity, mostly due to having purchased more expensive homes with smaller down payments. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w23664.pdf ER - TY - ICOMM T1 - A Financial Literacy Test That Works Y1 - 2017 A1 - Olivia S. Mitchell KW - Big Three KW - Financial literacy KW - Survey Methodology JF - Forbes PB - Forbes CY - New York City, NY UR - https://www.forbes.com/sites/pensionresearchcouncil/2017/12/14/a-financial-literacy-test-that-works/#50783139641f ER - TY - RPRT T1 - Incentivizing older people to delay social security claiming Y1 - 2017 A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Retirement Planning and Satisfaction KW - Social Security AB - Given rising life expectations around the world, it seems that old-age pension benefits will need to be cut and pension contributions boosted in many nations. Yet our research on old-age system reforms does not require raising mandatory retirement ages or contributions. Instead, we offer ways to enhance incentives for people to work longer and delay retirement. There are good reasons to incentivize older people to work longer and delay retirement. These include rising longevity, the shrinking workforce, and emerging evidence indicating that working longer can be associated with better mental and physical health for many people. Nevertheless, old age Social Security systems in many nations find that people tend to claim benefits early, usually leading to reduced benefits.In the United States, for instance, a majority of Americans claim their Social Security benefits at the earlier feasible age, namely 62, even though their monthly benefits would be 75% higher if they waited until age 70. To test whether this is the result of people underweighting the economic value of higher lifetime benefit streams, we examine whether people would claim later and work longer if they were rewarded with a lump sum instead of a higher lifetime benefit stream for deferring. Two arguments have been offered to explain early claiming. One is that workers claim early to avoid potentially “forfeiting” their deferred benefits should they die too soon (Brown et al., 2016). A second explanation is that many people underweight the economic value of lifetime benefit streams (Brown et al., 2017). This latter rationale motivates the present study. JF - SAFE Policy Letter Series PB - SAFE CY - Frankfurt, Germany UR - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/44313 ER - TY - JOUR T1 - Optimal financial knowledge and wealth inequality JF - The Journal of Political Economy Y1 - 2017 A1 - Annamaria Lusardi A1 - Pierre-Carl Michaud A1 - Olivia S. Mitchell KW - Financial literacy KW - Retirement Planning and Satisfaction KW - Wealth AB - We show that financial knowledge is a key determinant of wealth inequality in a stochastic lifecycle model with endogenous financial knowledge accumulation, where financial knowledge enables individuals to better allocate lifetime resources in a world of uncertainty and imperfect insurance. Moreover, because of how the U.S. social insurance system works, better-educated individuals have most to gain from investing in financial knowledge. Our parsimonious specification generates substantial wealth inequality relative to a one-asset saving model and one where returns on wealth depend on portfolio composition alone. We estimate that 30-40 percent of retirement wealth inequality is accounted for by financial knowledge. VL - 125 IS - 2 U1 - http://www.ncbi.nlm.nih.gov/pubmed/28555088?dopt=Abstract ER - TY - CHAP T1 - Are Retirees Falling Short? Reconciling the Conflicting Evidence T2 - Reimagining Pensions: The Next 40 Years Y1 - 2016 A1 - Alicia H. Munnell A1 - Matthew S. Rutledge A1 - Anthony Webb ED - Olivia S. Mitchell ED - Shea, Richard C. KW - Net Worth and Assets KW - Retirement Planning and Satisfaction AB - This paper examines conflicting assessments of whether people will have adequate retirement income to maintain their pre-retirement standard of living. The studies that it examines use data from the Survey of Consumer Finances (SCF), the Health and Retirement Study (HRS), and the HRS supplement Consumption and Activities Mail Survey (CAMS). Critical components of the analysis are behavioral assumptions about household consumption patterns when children leave home and when households retire. A key limitation is that the behavioral assumptions in the different studies are based on incomplete knowledge of actual household behavior. JF - Reimagining Pensions: The Next 40 Years PB - Oxford University Press CY - Oxford, United Kingdom U4 - household consumption/retirement preparedness/pre-retirement standard of living JO - Are Retirees Falling Short? Reconciling the Conflicting Evidence ER - TY - JOUR T1 - Framing and Claiming: How Information-Framing Affects Expected Social Security Claiming Behavior JF - Journal of Risk and Insurance Y1 - 2016 A1 - Brown, Jeffrey R. A1 - Arie Kapteyn A1 - Olivia S. Mitchell AB - This article provides evidence that Social Security benefit claiming decisions are strongly affected by framing and are thus inconsistent with expected utility theory. Using a randomized experiment that controls for both observable and unobservable differences across individuals, we find that the use of a “breakeven analysis” encourages early claiming. Respondents are more likely to delay when later claiming is framed as a gain, and the claiming age is anchored at older ages. Additionally, the financially less literate, individuals with credit card debt, and those with lower earnings are more influenced by framing than others. VL - 83 UR - http://doi.wiley.com/10.1111/jori.v83.1http://doi.wiley.com/10.1111/j.1539-6975.2013.12004.xhttps://api.wiley.com/onlinelibrary/tdm/v1/articles/10.1111%2Fj.1539-6975.2013.12004.x IS - 1 JO - Journal Risk and Insurance ER - TY - JOUR T1 - How Family Status and Social Security Claiming Options Shape Optimal Life Cycle Portfolios JF - Review of Financial Studies Y1 - 2016 A1 - Hubener, Andreas A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Gender Differences KW - Older Adults KW - Retirement Planning and Satisfaction KW - Social Security AB - We show how optimal household decisions regarding work, retirement, saving, portfolio allocations, and life insurance are shaped by the complex financial options embedded in U.S. Social Security rules and uncertain family transitions. Our life cycle model predicts sharp consumption drops on retirement, an age-62 peak in claiming rates, and earlier claiming by wives versus husbands and single women. Moreover, life insurance is mainly purchased on men's lives. Our model, which takes Social Security rules seriously, generates wealth and retirement outcomes that are more consistent with the data, in contrast to earlier and less realistic models VL - 29 UR - http://rfs.oxfordjournals.org/lookup/doi/10.1093/rfs/hhv070 IS - 4 JO - Rev. Financ. Stud. ER - TY - RPRT T1 - Older Peoples’ Willingness to Delay Social Security Claiming Y1 - 2016 A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Employment and Labor Force KW - Health Shocks KW - Older Adults KW - Retirement Planning and Satisfaction KW - Social Security AB - We have designed and fielded an experimental module in the 2014 HRS which seeks to measure older persons' willingness to voluntarily defer claiming of Social Security benefits. In addition, we evaluate the stated willingness of older individuals to work longer, depending on the Social Security incentives offered to delay claiming their benefits. Our project extends previous work by analyzing the results from our HRS module and comparing findings from other data sources which included very much smaller samples of older persons. We show that half of the respondents would delay claiming if no work requirement were in place under the status quo, and only slightly fewer, 46%, with a work requirement. We also asked respondents how large a lump sum they would need with or without a work requirement. In the former case, the average amount needed to induce delayed claiming was about $60,400, while when part-time work was required, the average was $66,700. This implies a low utility value of leisure foregone of only $6,300, or under 20% of average household income. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w22942.pdf ER - TY - RPRT T1 - Older Women’s Labor Market Attachment, Retirement Planning, and Household Debt Y1 - 2016 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Older Adults KW - Retirement Planning and Satisfaction KW - Women and Minorities AB - The goal of this paper is to ascertain whether older women’s current and anticipated future labor force patterns have changed over time, and if so, to evaluate the factors associated with longer work lives and plans to continue work at older ages. Using data from both the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS), we show that older women’s current and intended future labor force attachment patterns are changing over time. Specifically, compared to our 1992 HRS baseline, more recent cohorts of women in their 50’s and 60s’s are more likely to plan to work longer. When we explore the reasons for delayed retirement among older women, factors include education, more marital disruption, and fewer children than prior cohorts. But household finances also play a key role, in that older women today have more debt than previously and are more financially fragile than in the past. The NFCS data show that factors associated with retirement planning include having more education and greater financial literacy. Those who report excessive amounts of debt and are financially fragile are the least financially literate, had more dependent children, and experienced income shocks. Thus shocks do play a role in older women’s debt status, but it is not enough to have resources: people also need the capacity to manage those resources if they are to stay out of debt as they head into retirement. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w22606.pdf ER - TY - JOUR T1 - Public and Private Challenges of an Aging U.S. Population JF - Business Economics Y1 - 2016 A1 - Olivia S. Mitchell KW - Income KW - Income inequality KW - Savings KW - Social Security KW - Spending KW - Taxes AB - The challenges posed by the aging of the US population for business and public policy are vast. They are amplified particularly by: * Slow increase of incomes - and therefore low private savings - for those at the bottom of the pay distribution. * Cutbacks in employee health-care insurance and defined benefit pension plans. * Unsustainability of Social Security and Medicare as currently configured. This paper spells out these challenges and discusses how they can be addressed. Of particular importance are some combination of enhanced revenue and reduced expenditure for Social Security and Medicare, the shift of private pension plans from defined benefit to defined contribution, the need to consider later retirement ages, and the need for improved personal financial literacy. VL - 51 UR - http://dx.doi.org/10.1057/be.2016.6 IS - 1 JO - Bus Econ ER - TY - RPRT T1 - Time discounting and economic decision-making among the elderly Y1 - 2016 A1 - Huffman, David A1 - Maurer, Raimond A1 - Olivia S. Mitchell KW - Decision making KW - Health Conditions and Status KW - Older Adults AB - This paper evaluates the extent of heterogeneity in time discounting among elderly Americans, as well as its role in explaining older peoples' key behaviors. We first show how older Americans evaluate simple (hypothetical) intertemporal choices in which payments now are compared with payments in the future. This adds to the literature on time horizon experiments by focusing on a nationally representative sample of persons age 70+. Using the indicators derived from this experiment, we show how differences in discounting patterns are associated with characteristics of particular importance in elderly populations, such as serious health and mental conditions. We then relate our discounting measure to key outcome variables including wealth, the timing of retirement, investments in health, and decisions about end of life care. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w22438.pdf ER - TY - NEWS T1 - Why Boomer Women Are Worse Off Financially Than Their Predecessors T2 - The Wall Street Journal Y1 - 2016 A1 - Olivia S. Mitchell KW - Financial literacy KW - Older Adults KW - Wealth management KW - Women and Minorities JF - The Wall Street Journal UR - http://blogs.wsj.com/experts/2016/09/11/why-boomer-women-are-worse-off-financially-than-their-predecessors/ ER - TY - JOUR T1 - Disaggregating activities of daily living limitations for predicting nursing home admission. JF - Health Serv Res Y1 - 2015 A1 - Joelle H Fong A1 - Olivia S. Mitchell A1 - Benedict S K Koh KW - Activities of Daily Living KW - Age Factors KW - Aged KW - Aged, 80 and over KW - Female KW - Geriatric Assessment KW - Homes for the Aged KW - Humans KW - Male KW - Middle Aged KW - Nursing homes KW - Patient Admission KW - Residence Characteristics KW - Risk Factors KW - Sex Factors KW - Socioeconomic factors AB -

OBJECTIVE: To examine whether disaggregated activities of daily living (ADL) limitations better predict the risk of nursing home admission compared to conventionally used ADL disability counts.

DATA SOURCES: We used panel data from the Health and Retirement Study (HRS) for years 1998-2010. The HRS is a nationally representative survey of adults older than 50 years (n = 18,801).

STUDY DESIGN: We fitted Cox regressions in a continuous time survival model with age at first nursing home admission as the outcome. Time-varying ADL disability types were the key explanatory variables.

PRINCIPAL FINDINGS: Of the six ADL limitations, bathing difficulty emerged as the strongest predictor of subsequent nursing home placement across cohorts. Eating and dressing limitations were also influential in driving admissions among more recent cohorts. Using simple ADL counts for analysis yielded similar adjusted R(2) s; however, the amount of explained variance doubled when we allowed the ADL disability measures to time-vary rather than remain static.

CONCLUSIONS: Looking beyond simple ADL counts can provide health professionals insights into which specific disability types trigger long-term nursing home use. Functional disabilities measured closer in time carry more prognostic power than static measures.

PB - 50 VL - 50 IS - 2 N1 - Times Cited: 0 0 U1 - http://www.ncbi.nlm.nih.gov/pubmed/25256014?dopt=Abstract U2 - PMC4369222 U4 - ADL/IADL/Long Term Care/Nursing home placement ER - TY - JOUR T1 - Financial Literacy and Economic Outcomes: Evidence and Policy Implications. JF - J Retire Y1 - 2015 A1 - Olivia S. Mitchell A1 - Annamaria Lusardi AB -

This paper reviews what we have learned over the past decade about financial literacy and its relationship to financial decision-making around the world. Using three questions, we have surveyed people in several countries to determine whether they have the fundamental knowledge of economics and finance needed to function as effective decision-makers. We find that levels of financial literacy are low not only in the United States. but also in many other countries including those with well-developed financial markets. Moreover, financial illiteracy is particularly acute for some demographic groups, especially women and the less-educated. These findings are important since financial literacy is linked to borrowing, saving, and spending patterns. We also offer new evidence on financial literacy among high school students drawing on the 2012 Programme for International Student Assessment implemented in 18 countries. Last, we discuss the implications of this research for policy.

VL - 3 UR - http://www.iijournals.com/doi/10.3905/jor.2015.3.1.107 IS - 1 U1 - http://www.ncbi.nlm.nih.gov/pubmed/28553655?dopt=Abstract JO - Retirement ER - TY - RPRT T1 - Narrow Framing and Long-Term Care Insurance Y1 - 2015 A1 - Gottlieb, Daniel A1 - Olivia S. Mitchell KW - Employment and Labor Force KW - Medicare/Medicaid/Health Insurance KW - Net Worth and Assets KW - Risk Taking AB - We propose a model of narrow framing in insurance and test it using data from a new module we designed and fielded in the Health and Retirement Study. We show that respondents subject to narrow framing are substantially less likely to buy long-term care insurance than average. This effect is distinct from, and much larger than, the effects of risk aversion or adverse selection, and it offers a new explanation for why people underinsure their later-life care needs. PB - Cambridge, MA, National Bureau of Economic Research U4 - narrow framing/long term care insurance/risk Aversion/adverse selection ER - TY - JOUR T1 - The Economic Importance of Financial Literacy: Theory and Evidence JF - Journal of Economic Literature Y1 - 2014 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Decision making KW - Financial literacy KW - Older Adults KW - Welfare AB - This paper undertakes an assessment of a rapidly growing body of economic research on financial literacy. We start with an overview of theoretical research, which casts financial knowledge as a form of investment in human capital. Endogenizing financial knowledge has important implications for welfare, as well as policies intended to enhance levels of financial knowledge in the larger population. Next, we draw on recent surveys to establish how much (or how little) people know and identify the least financially savvy population subgroups. This is followed by an examination of the impact of financial literacy on economic decision making in the United States and elsewhere. While the literature is still young, conclusions may be drawn about the effects and consequences of financial illiteracy and what works to remedy these gaps. A final section offers thoughts on what remains to be learned if researchers are to better inform theoretical and empirical models as well as public policy. VL - 52 UR - http://pubs.aeaweb.org/doi/abs/10.1257/jel.52.1.5 IS - 1 JO - Journal of Economic Literature ER - TY - JOUR T1 - Financial literacy and financial sophistication in the older population JF - Journal of Pension Economics and Finance Y1 - 2014 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Vilsa Curto KW - Demographics KW - Net Worth and Assets KW - Other KW - Retirement Planning and Satisfaction AB - Using a special-purpose module implemented in the Health and Retirement Study, we evaluate financial sophistication in the American population over the age of 50. We combine several financial literacy questions into an overall index to highlight which questions best capture financial sophistication and examine the sensitivity of financial literacy responses to framing effects. Results show that many older respondents are not financially sophisticated: they fail to grasp essential aspects of risk diversification, asset valuation, portfolio choice, and investment fees. Subgroups with notable deficits include women, the least educated, non-Whites, and those age 75 . In view of the fact that retirees increasingly must take on responsibility for their own retirement security, such meager levels of knowledge have potentially serious and negative implications. PB - 13 VL - 13 IS - 4 N1 - Export Date: 21 April 2014 Source: Scopus Article in Press U4 - Financial knowledge/framing/gender differences/retirement security/retirement security ER - TY - JOUR T1 - How does retiree health insurance influence public sector employee saving? JF - Journal of health economics Y1 - 2014 A1 - Robert Clark A1 - Olivia S. Mitchell KW - Demographics KW - Pensions KW - Public Policy KW - Retirement Planning and Satisfaction AB - Economic theory predicts that employer-provided retiree health insurance (RHI) benefits have a crowd-out effect on household wealth accumulation, not dissimilar to the effects reported elsewhere for employer pensions, Social Security, and Medicare. Nevertheless, we are unaware of any similar research on the impacts of retiree health insurance per se. Accordingly, the present paper utilizes a unique data file on respondents to the Health and Retirement Study, to explore how employer-provided retiree health insurance may influence net household wealth among public sector employees, where retiree healthcare benefits are still quite prevalent. Key findings include the following: PB - 38 VL - 38 N1 - Times Cited: 0 0 U4 - Benefit/wealth tradeoff/Retiree health insurance/State and local employees/Federal employees/Retiree medical costs/retirement planning/Public Policy ER - TY - RPRT T1 - How Does Retiree Health Insurance Influence Public Sector Employee Saving? Y1 - 2013 A1 - Robert Clark A1 - Olivia S. Mitchell KW - Insurance KW - Net Worth and Assets KW - Public Policy KW - Retirement Planning and Satisfaction AB - Economic theory predicts that employer-provided retiree health insurance benefits crowd-out household wealth accumulation. Nevertheless, there is little research on the impacts of retiree health insurance on wealth accruals, so this paper utilizes a unique data file on three baseline cohorts from the Health and Retirement Study to explore how employer-provided retiree health insurance may influence net household wealth among public sector employees, where retiree healthcare benefits are still quite prevalent. We find that most full-time public sector employees who anticipate receiving employer-provided health insurance coverage in retirement save less than their private sector uncovered counterparts. PB - Cambridge, MA, National Bureau of Economic Research U4 - retiree health insurance/household wealth/Public Sector/employer-provided health insurance ER - TY - BOOK T1 - The Market for Financial Advice T2 - Pension Research Council Series Y1 - 2013 A1 - Olivia S. Mitchell A1 - Smetters, Kent KW - Economics KW - Financial literacy KW - Market analyses KW - Older Adults KW - Retirement Planning and Satisfaction JF - Pension Research Council Series PB - Oxford University Press CY - Oxford, UK ER - TY - RPRT T1 - Older Adult Debt and Financial Frailty Y1 - 2013 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Net Worth and Assets KW - Retirement Planning and Satisfaction AB - Of particular interest in the present economic environment is whether access to credit is changing peoples indebtedness over time, particularly as they approach retirement. This project analyzes older individuals debt, debt management practices, and financial fragility using data from the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS). Specifically, we examine three different cohorts (individuals age 56 61) in different time periods, 1992, 2002 and 2008, in the HRS to evaluate cross-cohort changes in debt over time. We also draw on recent data from the National Financial Capability Study (NFCS) which provides detailed information on how families manage their debt. Our goal is to assess how wealth and debt among older persons has evolved over time, along with the potential consequences for retirement security. We find that more recent cohorts have taken on more debt and face more financial insecurity, mostly due to having purchased more expensive homes with smaller down payments. In addition, Baby Boomers are more likely to have engaged in expensive borrowing practices. Factors associated with better debt outcomes include having higher income, more education, and greater financial literacy; those associated with financial fragility include having more children and experiencing unexpected large income declines. Thus, shocks do play a role in the accumulation of debt close to retirement. But it is not enough to have resources, people also need the capacity to manage those resources if they are to stay out of debt as they head into retirement. PB - Ann Arbor, The University of Michigan UR - http://www.mrrc.isr.umich.edu/dl.cfm?pid=946andtype=102 U4 - wealth/Financial planning/financial insecurity/retirement planning ER - TY - RPRT T1 - Optimal Financial Knowledge and Wealth Inequality Y1 - 2013 A1 - Annamaria Lusardi A1 - Pierre-Carl Michaud A1 - Olivia S. Mitchell KW - Financial literacy KW - Older Adults KW - Wealth Inequality KW - Women and Minorities AB - While financial knowledge is strongly positively related to household wealth, there is also considerable cross-sectional variation in both financial knowledge and net asset levels. To explore these patterns, we develop a calibrated stochastic life cycle model featuring endogenous financial knowledge accumulation. The model generates substantial wealth inequality, over and above that of standard life cycle models; this is because higher earners typically have more hump-shaped labor income profiles and lower retirement benefits which, when interacted with precautionary saving motives, boost their need for private wealth accumulation and thus financial knowledge. Our simulations show that endogenous financial knowledge accumulation has the potential to account for a large proportion of wealth inequality. The fraction of the population which is rationally financially "ignorant" depends on the generosity of the retirement system and the level of means-tested benefits. Educational efforts to enhance financial savvy early in the life cycle so as to produce one percentage point excess return per year would be valued highly by people in all educational groups. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w18669.pdf ER - TY - RPRT T1 - Financial Sophistication in the Older Population Y1 - 2012 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Vilsa Curto KW - Consumption and Savings KW - Employment and Labor Force KW - Event History/Life Cycle KW - Net Worth and Assets KW - Other KW - Public Policy KW - Women and Minorities AB - This paper examines data on financial sophistication among the U.S. older population, using a special-purpose module implemented in the Health and Retirement Study. We show that financial sophistication is deficient for older respondents (aged 55 ). Specifically, many in this group lack a basic grasp of asset pricing, risk diversification, portfolio choice, and investment fees. Subpopulations with particular deficits include women, the least educated, persons over the age of 75, and non-Whites. In view of the fact that people are increasingly being asked to take on responsibility for their own retirement security, such lack of knowledge can have serious implications. JF - NBER Working Paper PB - National Bureau of Economic Research CY - Cambridge, MA U4 - Numeracy/Financial sophistication/Financial sophistication/Intertemporal Consumer Choice/Life Cycle Models and Saving/Portfolio Choice/Investment Decisions/Investment Decisions/Economics of the Elderly/Economics of the Handicapped/Non-labor Market Discrimination/Public Policy ER - TY - RPRT T1 - Financial Sophistication in the Older Population Y1 - 2012 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Vilsa Curto KW - Financial literacy KW - Retirement Planning and Satisfaction AB - This paper examines data on financial sophistication among the U.S. older population, using a special-purpose module implemented in the Health and Retirement Study. We show that financial sophistication is deficient for older respondents (aged 55+). Specifically, many in this group lack a basic grasp of asset pricing, risk diversification, portfolio choice, and investment fees. Subpopulations with particular deficits include women, the least educated, persons over the age of 75, and non-Whites. In view of the fact that people are increasingly being asked to take on responsibility for their own retirement security, such lack of knowledge can have serious implications. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA ER - TY - RPRT T1 - Functional Disabilities and Nursing Home Admittance Y1 - 2012 A1 - Joelle H Fong A1 - Benedict S K Koh A1 - Olivia S. Mitchell KW - Disabilities KW - Hospitalization KW - Long-term Care KW - Mortality KW - Older Adults AB - This paper examines how inability to perform activities of daily living relates to the risk of nursing home admission over older adults' life courses. Using longitudinal data on persons over age 50 from the Health and Retirement Study, we show that aging one year boosts the probability of having two or more disabilities by 9 to 12 percent in a multivariate logistic model. Moreover, at least three-fifths of all 65-year-old men and three-quarters of women will experience disability levels during their remaining lifetimes severe enough to trigger nursing home admission. Our analysis also suggests that certain types of disability are more important than others in predicting nursing home admittance and use, which has implications for the design and benefits triggers for long-term care insurance programs. JF - Pension Research Council Working Paper PB - Pension Research Council, University of Pennsylvania CY - Philadelphia, PA ER - TY - CHAP T1 - The Outlook for Financial Literacy T2 - Financial Literacy: Implications for Retirement Security and the Financial Marketplace Y1 - 2012 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Financial literacy KW - Forecasting KW - Future KW - Older Adults JF - Financial Literacy: Implications for Retirement Security and the Financial Marketplace PB - Oxford University Press CY - Oxford, UK ER - TY - RPRT T1 - Retirement in Japan and the United States: Cross-national Comparisons using the Japanese Study of Aging and Retirement (JSTAR) and the U.S. Health and Retirement Study (HRS) Y1 - 2012 A1 - Olivia S. Mitchell A1 - John W R Phillips KW - Cross-National KW - JSTAR KW - Retirement AB - Cross-national comparisons of data from developed countries offer useful insights into the retirement process and policy. Here we summarize findings for older persons age 50-70 using new microdata files collected by the Japanese Study of Aging and Retirement (JSTAR) project, and we compare these with results in the U.S. Health and Retirement Study (HRS). We examine the relative importance of health, wealth, family, and other factors in work and retirement at older ages cross-nationally. Though both countries have relatively high employment at older ages, the Japanese have longer life expectancy, higher levels of financial wealth, and a lower public pension eligibility age. Our analysis, the first to compare these two rich data sources, suggests two conclusions (subject to revision when data weights become available). First, older Americans differ in key ways from their Japanese counterparts, particularly along educational, health, and wealth dimensions. Second, in some cases, there is a distinctly different impact of these factors on labor force outcomes. Specifically, age, sex, education, and wealth influence behavior differently across the two countries, though being obese or having better mental acuity/financial literacy scores has no differential impact. Thus observed differences in work patterns between Americans and Japanese at older ages are attributable to some identifiable factors; moreover, the results can be used to project future responses to changes in education, age, health, and wealth in order to account for the large differences in older workers’ work patterns at older ages in Japan and the US. JF - MRDRC Working Paper PB - Michigan Retirement and Disability Research Center CY - Ann Arbor UR - https://mrdrc.isr.umich.edu/pubs/retirement-in-japan-and-the-united-states-cross-national-comparisons-using-the-japanese-study-of-aging-and-retirement-jstar-and-the-u-s-health-and-retirement-study-hrs-2/ ER - TY - JOUR T1 - Financial literacy and retirement planning in the United States JF - Journal of Pension Economics and Finance Y1 - 2011 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Education KW - Financial literacy KW - Older Adults KW - Retirement Planning and Satisfaction AB - We examine financial literacy in the US using the new National Financial Capability Study, wherein we demonstrate that financial literacy is particularly low among the young, women, and the less-educated. Moreover, Hispanics and African-Americans score the least well on financial literacy concepts. Interestingly, all groups rate themselves as rather well-informed about financial matters, notwithstanding their actual performance on the key literacy questions. Finally, we show that people who score higher on the financial literacy questions are much more likely to plan for retirement, which is likely to leave them better positioned for old age. Our results will inform those seeking to target financial literacy programmes to those in most need. VL - 10 IS - 04 ER - TY - JOUR T1 - FINANCIAL LITERACY AROUND THE WORLD: AN OVERVIEW. JF - J Pension Econ Financ Y1 - 2011 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell AB -

In an increasingly risky and globalized marketplace, people must be able to make well-informed financial decisions. Yet new international research demonstrates that financial illiteracy is widespread when financial markets are well developed as in Germany, the Netherlands, Sweden, Japan, Italy, New Zealand, and the United States, or when they are changing rapidly as in Russia. Further, across these countries, we show that the older population believes itself well informed, even though it is actually less well informed than average. Other common patterns are also evident: women are less financially literate than men and are aware of this shortfall. More educated people are more informed, yet education is far from a perfect proxy for literacy. There are also ethnic/racial and regional differences: city-dwellers in Russia are better informed than their rural counterparts, while in the U.S., African Americans and Hispanics are relatively less financially literate than others. Moreover, the more financially knowledgeable are also those most likely to plan for retirement. In fact, answering one additional financial question correctly is associated with a 3-4 percentage point higher chance of planning for retirement in countries as diverse as Germany, the U.S., Japan, and Sweden; in the Netherlands, it boosts planning by 10 percentage points. Finally, using instrumental variables, we show that these estimates probably underestimate the effects of financial literacy on retirement planning. In sum, around the world, financial literacy is critical to retirement security.

VL - 10 UR - http://www.journals.cambridge.org/abstract_S1474747211000448 IS - 4 U1 - http://www.ncbi.nlm.nih.gov/pubmed/28553190?dopt=Abstract JO - Journal of Pension Economics and Finance ER - TY - BOOK T1 - Financial Literacy: Implications for Retirement Security and the Financial Marketplace T2 - Pension Research Council Series Y1 - 2011 A1 - Olivia S. Mitchell A1 - Annamaria Lusardi KW - Economics KW - Financial literacy KW - Older Adults KW - Retirement Planning and Satisfaction AB - As financial markets grow ever more complex and integrated, households must make increasingly sophisticated and all-too-often irreversible economic decisions. This is particularly evident in retirement decision-making. Traditional defined benefit pension schemes are being replaced with defined contribution pensions; employer and government judgment regarding how much to save and where to invest has been replaced by employees having to make these choices on their own (sometimes assisted by advisers); and retirees have become responsible for managing their own pension assets. This volume explores how financial literacy can enhance peoples’ ability to make informed economic choices. It proposes that financial literacy determines how well people make and execute saving, investing, borrowing, and planning decisions. It examines causality using controlled settings to disentangle whether financial literacy causes saving or vice versa, and demonstrates that financial education programs do indeed enhance financial decision-making and asset accumulation. JF - Pension Research Council Series PB - Oxford University Press CY - Oxford, UK SN - 0-19-969681-9 UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/financial-literacy-implications-for-retirement-security-and-the-financial-marketplace/ ER - TY - RPRT T1 - Financial Literacy, Schooling, and Wealth Accumulation Y1 - 2010 A1 - Behrman, Jere R. A1 - Olivia S. Mitchell A1 - Soo, Cindy A1 - Bravo, David A1 - The Wharton School KW - Educational attainment KW - Financial literacy KW - household wealth AB - Financial literacy and schooling attainment have been linked to household wealth accumulation. Yet prior findings may be biased due to noisy measures of financial literacy and schooling, as well as unobserved factors such as ability, intelligence, and motivation that could enhance financial literacy and schooling but also directly affect wealth accumulation. Here we use a new household dataset and an instrumental variables approach to isolate the causal effects of financial literacy and schooling on wealth accumulation. While financial literacy and schooling attainment are both strongly positively associated with wealth outcomes in linear regression models, our approach reveals even stronger and larger effects of financial literacy on wealth. It also indicates no significant positive effects of schooling attainment conditional on financial literacy in a linear specification, but positive effects when interacted with financial literacy. Estimated impacts are substantial enough to suggest that investments in financial literacy could have large positive payoffs. JF - PARC Working Paper Series PB - Pension Research Council, University of Pennsylvania CY - Philadelphia, PA UR - https://repository.upenn.edu/cgi/viewcontent.cgi?article=1031&context=parc_working_papers U4 - Financial literacy/education/wealth Accumulation ER - TY - CHAP T1 - Human Capital Risk and Pension Outcomes T2 - Evaluating the Financial Performance of Pension Funds Y1 - 2010 A1 - Olivia S. Mitchell A1 - John A. Turner KW - Older Adults KW - Pensions KW - Retirement Planning and Satisfaction KW - Risk Factors JF - Evaluating the Financial Performance of Pension Funds PB - World Bank CY - Washington, DC ER - TY - RPRT T1 - Financial Literacy and Financial Sophistication Among Older Americans Y1 - 2009 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell A1 - Vilsa Curto KW - Consumption and Savings KW - Net Worth and Assets KW - Retirement Planning and Satisfaction AB - This paper analyzes new data on financial literacy and financial sophistication from the 2008 Health and Retirement Study. We show that financial literacy is lacking among older individuals and for the first time explore additional questions on financial sophistication which proves even scarcer. For this sample of older respondents over the age of 55, we find that people lack even a rudimentary understanding of stock and bond prices, risk diversification, portfolio choice, and investment fees. In view of the fact that individuals are increasingly required to take on responsibility for their own retirement security, this lack of knowledge has serious implications. JF - NBER Working Paper PB - The National Bureau of Economic Research CY - Cambridge, MA U4 - Financial Management/Portfolio Choice/Retirement planning/Retirement Saving ER - TY - JOUR T1 - Hypothetical versus Actual Earnings Profiles: Implications for Social Security Reform JF - Journal of Financial Transformation Y1 - 2009 A1 - Olivia S. Mitchell A1 - John W R Phillips KW - Income KW - Older Adults KW - Social Security VL - 24 ER - TY - JOUR T1 - Social Security Research at the Michigan Retirement Research Center JF - Social Security Bulletin Y1 - 2009 A1 - R.V. Burkhauser A1 - Alan L Gustman A1 - John Laitner A1 - Olivia S. Mitchell A1 - Amanda Sonnega KW - Pension KW - Retirement KW - Social Security AB - Social Security has been a topic of widespread discussion in the last decade. Rising longevity and falling fertility have led to an aging population, which increases solvency challenges for the Social Security system. Public concerns over low national saving have led to an extensive dialog on the merits of reform that might change the U.S. system into one with fully or partially funded personal accounts. Meanwhile, pensions in the private sector have been evolving from predominantly defined benefit (DB) to predominantly defined contribution (DC), raising concerns that workers preparing for retirement have more personal responsibility, with more complex financial challenges, than ever before. VL - 69 UR - https://www.ssa.gov/policy/docs/ssb/v69n4/v69n4p51.html IS - 4 ER - TY - JOUR T1 - Social Security Research at the Michigan Retirement Research Center JF - Social Security Bulletin Y1 - 2009 A1 - R.V. Burkhauser A1 - Alan L Gustman A1 - John Laitner A1 - Olivia S. Mitchell A1 - Amanda Sonnega KW - Meta-analyses KW - Older Adults KW - Research KW - Social Security AB - Social Security has been a topic of widespread discussion in the last decade. Rising longevity and falling fertility have led to an aging population, which increases solvency challenges for the Social Security system. Public concerns over low national saving have led to an extensive dialog on the merits of reform that might change the U.S. system into one with fully or partially funded personal accounts. Meanwhile, pensions in the private sector have been evolving from predominantly defined benefit (DB) to predominantly defined contribution (DC), raising concerns that workers preparing for retirement have more personal responsibility, with more complex financial challenges, than ever before. VL - 69 UR - https://www.ssa.gov/policy/docs/ssb/v69n4/v69n4p51.pdf IS - 4 ER - TY - RPRT T1 - Planning and Financial Literacy: How do women fare? Y1 - 2008 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Net Worth and Assets KW - Retirement Planning and Satisfaction KW - Women and Minorities AB - Many older US households have done little or no planning for retirement, and there is a substantial population that seems to undersave for retirement. Of particular concern is the relative position of older women, who are more vulnerable to old-age poverty due to their longer longevity. This paper uses data from a special module we devised on planning and financial literacy in the 2004 Health and Retirement Study. It shows that women display much lower levels of financial literacy than the older population as a whole. In addition, women who are less financially literate are also less likely to plan for retirement and be successful planners. These findings have important implications for policy and for programs aimed at fostering financial security at older ages. JF - NBER Working Paper PB - National Bureau of Economic Research CY - Cambridge, MA, U4 - Retirement Planning/Financial Management/WOMEN ER - TY - RPRT T1 - Who Values the Social Security Annuity? New evidence on the annuity puzzle Y1 - 2008 A1 - Brown, Jeffrey R. A1 - Casey, Marcus D. A1 - Olivia S. Mitchell KW - Methodology KW - Net Worth and Assets KW - Pensions KW - Social Security AB - We examine individuals' self-reported willingness to exchange part of their Social Security inflation-indexed annuity benefit for an immediate lump-sum payment, using an experimental module in the 2004 Health and Retirement Study. Our first finding is that nearly three out of five respondents favor the lump-sum payment if it were approximately actuarially fair, a finding that casts doubt on several leading explanations for why more people do not annuitize. Second, there is some modest price sensitivity and evidence consistent with adverse selection; in particular, people in better health and having more optimistic longevity expectations are more likely to choose the annuity. Third, after controlling on education, more financially literate individuals prefer the annuity. Fourth, people anticipating future Social Security benefit reductions are more likely to choose the lump-sum, suggesting that political risk matters. Other factors such as sex, marital status, income, wealth, or the presence of children are not associated with respondents' relative preferences for the annuity versus the lump-sum. JF - NBER Working Paper PB - National Bureau of Economic Research CY - Cambridge, MA U4 - Social Security/Social Security Research/lump sum distributions/Annuities ER - TY - JOUR T1 - Baby Boomer Retirement Security: The Roles of Planning, Financial Literacy, and Housing Wealth JF - Journal of Monetary Economics Y1 - 2007 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Housing KW - Net Worth and Assets AB - Recent research on wealth and household finances seeks to blend neoclassical models with an understanding of real-world imperfections to answer questions about why some people save and others do not. This paper focuses on Baby Boomers standing on the verge of retirement, many of whom have saved little and will face financial insecurity in old age. The new 2004 wave of the Health and Retirement Study is invaluable for this first analysis of the financial situation of leading-edge Boomers, as it reports not only wealth levels but also information about respondents planning behaviors and economic literacy. We show that the distribution of net worth among Early Baby Boomers is quite skewed; those in the 75th percentile had over 10 times the net worth ( 400K) of households in the bottom 25th percentile ( 37K). There is substantial heterogeneity in wealth within this cohort: the median high-school dropout had less than 23K in total net worth, while the median college graduate had over 10 times as much. Many Black and Hispanic Boomer households hold miniscule levels of wealth. Further, many in this cohort have accumulated little wealth outside their homes: at the mean, one third of the early Boomers wealth is held in the form of home equity, and at the median the fraction is close to half. Since many members of this EBB cohort are reaching retirement with a substantial portion of its wealth in housing, they are particularly vulnerable to housing value shocks. By contrast, holders of stocks, IRAs, and business equity are concentrated in the top quartiles. Finally, we show that planning and economic literacy are important predictors of savings and investment success. PB - 54 VL - 54 IS - 1 N1 - Revision of MRRC WP 2006-114 U4 - Retirement Wealth/Housing Equity/Stock Market ER - TY - CHAP T1 - Cross-Cohort Differences in Health on the Verge of Retirement T2 - Redefining Retirement: How Will Boomers Fare? Y1 - 2007 A1 - Beth J Soldo A1 - Olivia S. Mitchell A1 - Tfaily, Rania A1 - John McCabe KW - Health Conditions and Status KW - Other KW - Retirement Planning and Satisfaction AB - Baby Boomers have left a unique imprint on US culture and society in the last 60 years, and it might be anticipated that they will also put their own stamp on retirement, the last phase of the life cycle. Yet because Boomers have not all fully retired, we cannot yet judge how they will fare as retirees. Instead, we focus on how this group compares with prior groups on the verge of retirement, that is, at ages 51-56. Accordingly, this chapter evaluates the stock of health which Early Boomers bring to retirement and compare these to the circumstances of two prior cohorts at the same point in their life cycles. Using three sets of responses from the Health and Retirement Study, we find some interesting patterns. Overall, the raw evidence indicates that Boomers on the verge of retirement are in poorer health their counterparts 12 years ago. Using a summary health index designed for this study, we find that those born 1948 to 1953 share health risks with the War Baby cohort. This suggests that most of the health decline instead began before the late 1940's. A more complex set of health conclusions emerges from the specific self-reported health measures. Boomers indicate they have relatively more difficulty with a range of everyday physical tasks, but they also report having more pain, more chronic conditions, more drinking and psychiatric problems, than their HRS earlier counterparts. This trend portends poorly for the future health of Boomers as they age and incur increasing costs associated with health care and medications. Using our health index, only those at the 75th percentile or higher are likely to be characterized as having good or better health. JF - Redefining Retirement: How Will Boomers Fare? PB - Oxford University Press CY - New York, NY N1 - ProCite field 6 : In ProCite field 8 : eds U4 - COHORT/health status/RETIREMENT JO - Cross-Cohort Differences in Health on the Verge of Retirement ER - TY - CHAP T1 - Lifetime Earnings Variability and Retirement Shortfalls T2 - Retirement Provision in Scary Markets Y1 - 2007 A1 - Olivia S. Mitchell A1 - John W R Phillips A1 - Au, Andrew ED - Hazel Bateman KW - Net Worth and Assets JF - Retirement Provision in Scary Markets PB - Edward Elgar CY - Cheltenham:UK N1 - ProCite field 6 : In ProCite field 8 : ed. U4 - Retirement Wealth JO - Lifetime Earnings Variability and Retirement Shortfalls ER - TY - BOOK T1 - Redefining Retirement: How Will Boomers Fare? Y1 - 2007 A1 - Brigitte C. Madrian A1 - Olivia S. Mitchell A1 - Beth J Soldo KW - Consumption and Savings KW - Health Conditions and Status KW - Income KW - Medicare/Medicaid/Health Insurance KW - Net Worth and Assets KW - Pensions PB - Oxford University Press CY - New York, NY UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/redefining-retirement-how-will-boomers-fare/ N1 - ProCite field 8 : eds U4 - Cohort Studies/retirement adequacy/Pensions/Retirement Saving/Retirement Wealth/health status ER - TY - CHAP T1 - Saving Between Cohorts: The Role of Planning T2 - Redefining Retirement: How Will Boomers Fare? Y1 - 2007 A1 - Annamaria Lusardi A1 - Beeler, Jason ED - Brigitte C. Madrian ED - Olivia S. Mitchell ED - Beth J Soldo KW - adequacy KW - Baby Boomer KW - Education KW - Housing KW - Income KW - minorities KW - Retirement Planning KW - Saving AB - We compare the saving behavior of two cohorts: the Early Baby Boomers (EBB, age 51- 56 in 2004) and the HRS cohort (age 51-56 in 1992). We find that EBB have accumulated more wealth than the previous cohort but they benefited from a large increase in house prices, which lifted the wealth of many home-owners. In fact, there are many families among EBB, particularly those headed by respondents with low education, low income, and minorities, which have less wealth than the previous cohort. Lack of wealth can be traced to lack of retirement planning. Notwithstanding the many initiatives aimed at fostering planning in the 1990s, a large portion of EBB still do not plan for retirement even though most respondents are close to it. The effect of planning is remarkably similar between the two cohorts; those who do not plan accumulate much lower amounts of wealth from 20 to 45 percent depending on the location in the wealth distribution- than those who do plan. Thus, for both the EBB and the HRS cohort, lack of planning is tantamount to lack of saving irrespective of the many changes in the economy between 1992 and 2004. JF - Redefining Retirement: How Will Boomers Fare? PB - Oxford University Press CY - New York, NY UR - https://oxford.universitypressscholarship.com/view/10.1093/acprof:oso/9780199230778.001.0001/acprof-9780199230778-chapter-13 N1 - ProCite field 6 : In ProCite field 8 : eds U4 - COHORT/Wealth Accumulation ER - TY - CHAP T1 - Will Boomers Redefine Retirement? T2 - Redefining Retirement: How Will Boomers Fare? Y1 - 2007 A1 - Olivia S. Mitchell JF - Redefining Retirement: How Will Boomers Fare? PB - Oxford University Press CY - Oxford, UK ER - TY - RPRT T1 - Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education Programs Y1 - 2006 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Net Worth and Assets KW - Retirement Planning and Satisfaction AB - Economists are beginning to investigate the causes and consequences of financial illiteracy to better understand why retirement planning is lacking and why so many households arrive close to retirement with little or no wealth. Our review reveals that many households are unfamiliar with even the most basic economic concepts needed to make saving and investment decisions. Such financial illiteracy is widespread: the young and older people in the United States and other countries appear woefully under-informed about basic financial computations, with serious implications for saving, retirement planning, mortgages, and other decisions. In response, governments and several nonprofit organizations have undertaken initiatives to enhance financial literacy. The experience of other countries, including a saving campaign in Japan as well as the Swedish pension privatization program, offers insights into possible roles for financial literacy and saving programs. JF - Michigan Retirement Research Center Publication PB - Michigan Retirement Research Center, University of Michigan CY - Ann Arbor, MI U4 - Financial Management/Retirement Planning/Investments ER - TY - JOUR T1 - Social Security Replacement Rates for Alternative Earnings Benchmarks JF - Benefits Quarterly Y1 - 2006 A1 - Olivia S. Mitchell A1 - John W R Phillips KW - Retirement Planning and Satisfaction KW - Social Security AB - Social Security reform proposals are often presented in terms of their differential impacts on hypothetical or example workers. This article explores how different benchmarks produce different replacement rate outcomes. The authors use the Health and Retirement Study (HRS) from the University of Michigan to evaluate how Social Security benefit replacement rates differ for actual versus hypothetical earner profiles, and examine whether these findings are sensitive to alternative definitions of replacement rates. They conclude that more precise analyses of possible distributional patterns from Social Security reform proposals would follow if benefit estimates were derived from actual earnings profiles, rather than hypothetical scaled patterns. PB - 22 VL - 22 IS - 4 U4 - Social Security and Public Pensions/Retirement Planning ER - TY - RPRT T1 - Social Security Replacement Rates for Alternative Earnings Benchmarks Y1 - 2006 A1 - John W R Phillips A1 - Olivia S. Mitchell KW - Public Policy KW - Social Security AB - Social Security reform proposals are often presented in terms of their differential impacts on hypothetical or example workers. Our work explores how different benchmarks produce different replacement rate outcomes. We use the Health and Retirement Study (HRS) to evaluate how Social Security benefit replacement rates differ for actual versus hypothetical earner profiles, and we examine whether these findings are sensitive to alternative definitions of replacement rates. We find that workers with the median HRS profile would be estimated to receive benefits worth 55 of lifetime average earnings, versus 48 for the SSA medium scaled profile. Since US policymakers tend to prefer a replacement rate measure tied to workers own past earnings, using these metrics would yield higher replacement rates compared to commonly used scaled illustrative profiles. However, benchmarks that use population as opposed to individual earnings measures to compare individual worker benefits to pre-retirement consumption produce lower replacement rates for HRS versus hypothetical earners. JF - Pension Research Council Working Paper PB - The Wharton School, University of Pennsylvania CY - Philadelphia, PA UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/papers-2018/social-security-replacement-rates-for-alternative-earnings-benchmarks/ U4 - Social Security/POLICY ER - TY - CHAP T1 - Changing the Retirement Paradigm T2 - Reinventing the Retirement Paradigm Y1 - 2005 A1 - Robert Clark A1 - Olivia S. Mitchell JF - Reinventing the Retirement Paradigm PB - Oxford University Press CY - Oxford, UK ER - TY - RPRT T1 - Financial Literacy and Planning: Implications for Retirement Well-Being Y1 - 2005 A1 - Annamaria Lusardi A1 - Olivia S. Mitchell KW - Net Worth and Assets KW - Retirement Planning and Satisfaction AB - Only a minority of American households feels confident about retirement saving adequacy, and little is known about why people fail to plan for retirement, and whether planning and information costs might affect retirement saving patterns. To better understand these issues, we devised and fielded a purpose-built module on planning and financial literacy for the 2004 Health and Retirement Study (HRS). This module measures how workers make their saving decisions, how they collect the information for making these decisions, and whether they possess the financial literacy needed to make these decisions. Our analysis shows that financial illiteracy is widespread among older Americans: only half of the age 50 respondents could correctly answer two simple questions regarding interest compounding and inflation, and only one-third correctly answered these two questions and a question about risk diversification. Women, minorities, and those without a college degree were particularly at risk of displaying low financial knowledge. We also evaluate whether people tried to figure out how much they need to save for retirement, whether they devised a plan, and whether they succeeded at the plan. In fact, these calculations prove to be difficult: fewer than one-third of our age 50 respondents ever tried to devise a retirement plan, and only two-thirds of those who tried actually claim to have succeeded. Overall, fewer than one-fifth of the respondents believed they engaged in successful retirement planning. We also find that financial knowledge and planning are clearly interrelated: those who displayed financial knowledge were more likely to plan and to succeed in their planning. Moreover, those who did plan were more likely to rely on formal methods such as retirement calculators, retirement seminars, and financial experts, and less likely to rely on family/relatives or co-workers. PB - The University of Michigan, Michigan Retirement Research Center U4 - Financial Management/Retirement Planning ER - TY - RPRT T1 - Saving Shortfalls and Delayed Retirement Y1 - 2005 A1 - Au, Andrew A1 - Olivia S. Mitchell A1 - John W R Phillips KW - Consumption and Savings KW - Retirement Planning and Satisfaction AB - Prior research has suggested that many older Americans have not saved enough to maintain consumption levels in old age. One way older persons might respond to inadequate savings would be to extend their worklives by delaying retirement. This paper examines evidence on this matter using the Health and Retirement Study, a nationally representative panel survey of people age 51-61 in 1992 followed for several years in a panel. We use the data to project household retirement assets and to determine how much more saving would be needed to preserve post-retirement consumption levels. Our research then examines the links between derived saving shortfall measures and delayed retirement patterns. Among nonmarried persons, there is evidence that larger shortfalls do produce delayed retirement, though the effect is not quantitatively large. For married couples, pre-retirement wealth shortfalls do not appear to be significantly associated with delayed retirement. Evidently couples have other means of handling saving shortfalls. JF - University of Michigan Retirement Research Center Working Paper PB - Michigan Retirement Research Center, University of Michigan CY - Ann Arbor, MI UR - https://deepblue.lib.umich.edu/handle/2027.42/50525 U4 - Retirement Saving/Retirement Planning/Consumption ER - TY - RPRT T1 - Crime and Early Retirement Among Older Americans Y1 - 2004 A1 - Daniel S. Silverman A1 - Olivia S. Mitchell KW - Health Conditions and Status KW - Retirement Planning and Satisfaction AB - This paper investigates the relationship between local crime rates and the retirement decisions of older Americans. We do so by linking data from the Health and Retirement Study with measures of local crime patterns taken from the Federal Bureau of Investigation s Unified Crime Reports. If we condition on crime rates alone, there is either a weakly positive or no relationship between local crime patterns and older men s propensity to retire early. But unobservable factors associated with early retirement may be correlated with residence in higher-crime rate cities, so next we condition on both the expectation for the crime rate and deviations from average crime levels. We find a positive and statistically significant association between early retirement and expectations for murder rates, and a positive but, on average, imprecisely estimated positive association between early retirement and unexpected increases in crime. The effect of unanticipated increases in crime is greatest, and significant for those in poor health. In this latter group, men are 14 percent more likely to retire early given a standard deviation increase in unexpected murder rates. These findings are consistent with a pattern of more early retirement among those who live in higher crime areas, and earlier retirement among those in poor health when crime levels rise above anticipated levels. JF - Pension Research Council Working Paper PB - University of Pennsylvania Population Aging Resear CY - Philadelphia, PA UR - https://repository.upenn.edu/prc_papers/412/ U4 - Retirement Behavior/Safety ER - TY - CHAP T1 - Financial Education and Saving T2 - Pension Design and Structure: New Lessons from Behavioral Economics Y1 - 2004 A1 - Annamaria Lusardi ED - Olivia S. Mitchell ED - Utkus, S. KW - Education KW - Net Worth and Assets KW - Retirement Planning and Satisfaction AB - 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. JF - Pension Design and Structure: New Lessons from Behavioral Economics PB - Oxford University Press UR - https://www.dartmouth.edu/~alusardi/Papers/Financial_Education_2004.pdf N1 - RDA 1998-002 ProCite field 6 : In ProCite field 8 : eds. U4 - Financial Management/Retirement Education/Retirement Planning/Education, Financial JO - Financial Education and Saving ER - TY - RPRT T1 - The Impact of Health Status and Out-of-Pocket Medical Expenditures on Annuity Valuation Y1 - 2004 A1 - Cassio M. Turra A1 - Olivia S. Mitchell KW - Annuitization KW - Health Insurance KW - Medicare/Medicaid/Health Insurance KW - Older Adults AB - This paper describes how differences in health status at retirement can influence the decision to purchase a life annuity. We extend previous research on annuitization decisions by incorporating the effect of health differentials via differences in survival throughout the latter portion of life. Next, we consider how precautionary savings motivated by uncertain out-of-pocket medical expenses influence annuitization decisions. Our results show that annuities become less attractive to people facing uncertain medical expenses. While full annuitization would still be optimal if annuity markets were truly complete and both life- and health-contingent, lacking this, annuity equivalent wealth values are much lower for those in poor health, as compared to persons in good health. JF - Michigan Retirement Research Center Research Working Paper PB - Michigan Retirement Research Center, University of Michigan CY - Ann Arbor, MI UR - https://ideas.repec.org/p/mrr/papers/wp086.html ER - TY - RPRT T1 - Modeling Lifetime Earnings Paths: Hypothetical versus Actual Workers Y1 - 2004 A1 - Olivia S. Mitchell A1 - John W R Phillips A1 - Au, Andrew KW - Net Worth and Assets KW - Pensions KW - Social Security AB - To assess the distributional effects of social security reform proposals, it is essential to have good information on real-world workers lifetime earnings trajectories. Until recently, however, policymakers have relied on hypothetical earnings profiles for policy analysis. We use actual lifetime earnings data from the Health and Retirement Study (HRS) to compare actual workers covered earnings profiles to these hypothetical profiles. We show that the hypothetical profiles do not track earnings patterns of current retirees; thus lifetime pay levels are much higher than for most HRS workers. Therefore, using hypothetical profiles could misrepresent benefits paid and taxes collected under such reforms. PB - University of Pennsylvania, Boettner Center for Pe, Pension Research Council WP 2004-3 U4 - Pensions/Retirement Wealth/Social Security ER - TY - BOOK T1 - Benefits for the Future Workplace Y1 - 2003 A1 - Olivia S. Mitchell A1 - Blitzstein, David A1 - Mazo, Judy A1 - Gordon, Michael KW - Employment and Labor Force KW - Pensions PB - University of Pennsylvania Press CY - Philadelphia, PA N1 - ProCite field 8 : eds. U4 - Workplace/Benefits ER - TY - JOUR T1 - Guaranteeing Defined Contribution Pensions: The Option to Buy Back a Defined Benefit Promise JF - Journal of Risk and Insurance Y1 - 2003 A1 - Lachance, Marie-Eve A1 - Olivia S. Mitchell A1 - Smetters, Kent KW - Pensions AB - After a long commitment to defined benefit (DB) pension plans for U.S. public sector employees, many state legislatures have introduced defined contribution (DC) plans for their public employees. In this process, investment risk that was previously borne by state DB plans has now devolved to employees covered by the new DC plans. In light of this trend, some states have introduced a guarantee mechanism to help protect DC plan participants. One such guarantee takes the form of an option permitting DC plan participants to buy back their DB benefit for a price. This article develops a theoretical framework to analyze the option design and illustrate how employee characteristics influence the option's cost. We illustrate the potential impact of a buy-back option in a pension reform enacted recently by the State of Florida for its public employees. If employees were to exercise the buy-back option optimally, the market value of this option could represent up to 100 percent of the DC contributions over their work life. PB - 70 VL - 70 UR - https://ssrn.com/abstract=388535 IS - 1 U4 - Pension Plans ER - TY - RPRT T1 - Lifetime Earnings Variability and Retirement Wealth Y1 - 2003 A1 - Olivia S. Mitchell A1 - John W R Phillips A1 - Au, Andrew A1 - McCarthy, David KW - Income KW - Net Worth and Assets AB - This paper explores how earnings variability is related to retirement wealth. Past research has demonstrated that the average American household on the verge of retirement would need to save substantially more, in order to preserve consumption flows in old age. While several socioeconomic factors have been examined that might explain such problems, prior studies have not assessed the role of earnings variability over the lifetime as a potential explanation for poor retirement prospects. Thus two workers having identical levels of average lifetime earnings might have had very different patterns of earnings variability over their lifetimes. Such differences could translate into quite different retirement wealth outcomes. This paper evaluates the effect of earnings variability on retirement wealth using information supplied by respondents to the Health and Retirement Study (HRS). This is a rich and nationally representative dataset on Americans on the verge of retirement, with responses linked to administrative records from the Social Security Administration. Our research illuminates the key links between lifetime earnings variability and retirement wealth. JF - Michigan Retirement Research Center Research Working Paper PB - Michigan Retirement Research Center at the University of Michigan, CY - Ann Arbor, MI U4 - Income Variability/Retirement Wealth ER - TY - JOUR T1 - Perspectives from the President’s Commission on Social Security Reform JF - Journal of Economic Perspectives Y1 - 2003 A1 - John F. Cogan A1 - Olivia S. Mitchell KW - Older Adults KW - Retirement Planning and Satisfaction KW - Social Security KW - Taxes AB - Social Security faces a severe financial problem. In about 15 years, the program will begin to experience permanent annual cash deficits, when annual benefit payments will exceed the amount collected in payroll tax revenues. By 2041, according to the Social Security Trustees 2002 Report, the Social Security trust fund is projected to be insolvent, meaning that the program will be legally unable to pay scheduled benefits. One way of expressing the financial shortfall is to compute the present value of the difference between system outlays and revenues over a 75-year horizon, which is currently equal to a permanent and immediate tax rate increase of 1.86 percent of payroll, or equivalent to $3.2 trillion in present value. If the policy of pay-as-you-go financing is continued for the next 25 years, a 50 percent payroll tax increase will be required at that time to pay scheduled benefits. VL - 17 UR - https://web.stanford.edu/class/econ21si/coganmitchell_prescommission.pdf IS - 2 ER - TY - RPRT T1 - Retirement Wealth and Lifetime Earnings Variability Y1 - 2003 A1 - Olivia S. Mitchell A1 - John W R Phillips A1 - Au, Andrew A1 - McCarthy, David KW - Net Worth and Assets KW - Social Security AB - This paper explores understand how earnings variability influences peoples’ retirement preparedness by influencing their accumulated wealth levels as of retirement age. Prior research has demonstrated that the US average household nearing retirement would need to save substantially more in order to preserve consumption in old age. While some socioeconomic factors have been suggested that might explain shortfalls, previous studies have not assessed the role of earnings variability over the lifetime as a potential explanation for poor retirement prospects. Thus two workers having identical levels of average lifetime earnings might have had very different patterns of earnings variability over their lifetimes. Such differences could translate into quite different retirement wealth outcomes. We evaluate the effect of earnings variability on retirement wealth using information supplied by respondents to the Health and Retirement Study (HRS). This is a rich and nationally representative dataset on Americans on the verge of retirement, with responses linked to administrative records from the Social Security Administration. Our research illuminates key links between lifetime earnings variability and retirement wealth. JF - Pension Research Council Publications PB - University of Pennsylvania, Wharton School CY - Philadelphia UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/papers-2018/retirement-wealth-and-lifetime-earnings-variability/ N1 - RDA U4 - Retirement Wealth/Earnings and Benefits File ER - TY - CHAP T1 - Aging and Housing Equity T2 - Innovations in Retirement Financing Y1 - 2002 A1 - Steven F Venti A1 - David A Wise ED - Zvi Bodie ED - P. Brett Hammond ED - Olivia S. Mitchell ED - Stephen P. Zeldes KW - Housing JF - Innovations in Retirement Financing PB - University of Pennsylvania Press/Pension Research Council CY - Philadephia, PA UR - http://www.nber.org/papers/w7882 N1 - ProCite field 6 : In ProCite field 8 : eds. U4 - Housing Equity JO - Aging and Housing Equity ER - TY - RPRT T1 - Guaranteeing Defined Contribution Pensions: The Option to Buy-Back a Defined Benefit Promise Y1 - 2002 A1 - Lachance, Marie-Eve A1 - Olivia S. Mitchell KW - buy-back option KW - Pension plans JF - NBER Working Paper PB - The National Bureau of Economic Research CY - Cambridge, MA ER - TY - BOOK T1 - Innovations in Retirement Financing Y1 - 2002 A1 - Zvi Bodie A1 - P. Brett Hammond A1 - Olivia S. Mitchell A1 - Stephen P. Zeldes KW - Consumption and Savings PB - University of Pennsylvania Press CY - Philadelphia, PA UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/innovations-in-retirement-financing/ N1 - ProCite field 8 : eds. U4 - Retirement Saving ER - TY - CHAP T1 - Worklife Determinants of Retirement Income Differentials Between Men and Women T2 - Innovations in Financing Retirement Y1 - 2002 A1 - Phillip B. Levine A1 - Olivia S. Mitchell A1 - John W R Phillips ED - Z. Bodie ED - Hammond, B. ED - Olivia S. Mitchell KW - Income KW - Methodology KW - Retirement Planning and Satisfaction KW - Women and Minorities AB - Women enter retirement having spent fewer years in market, earned less over their lifetimes, and work in different jobs than men of the same age. This study examines whether these differences in work life experiences help explain why many women end with lower level of retirement income in old age. We use Health and Retirement Study (HRS), which provide information on labor market histories along with the ability to predict retirement income from employer pensions, social security benefits, and investment returns. We document differences in anticipated retirement income by sex that exist largely between non-married men and women. Multivariate models show that 85 percent of this retirement income gap can be attributed to differences in lifetime labor market earnings, years worked, and occupational segregation by sex. Our results suggest that as women's work life experiences become more congruent with men's over time, the gap in retirement income between men and women may shrink. JF - Innovations in Financing Retirement PB - University of Pennsylvania Press CY - Philadelphia, PA UR - http://www.nber.org/papers/w7243 N1 - RDA ProCite field 6 : In ProCite field 8 : eds. U4 - Economics of Gender/Retirement/Retirement Policies/Retirement Incomes/Income by Sex/Women JO - Worklife Determinants of Retirement Income Differentials Between Men and Women ER - TY - RPRT T1 - Eligibility for Social Security Disability Insurance Y1 - 2001 A1 - Olivia S. Mitchell A1 - John W R Phillips KW - Disabilities KW - Insurance KW - Social Security PB - Philadephia, PA, University of Pennsylvania, The Wharton School UR - http://prc/wharton.upenn.edu/prc/prc.html U4 - Social Security/Insurance/Disability/Disability ER - TY - JOUR T1 - A Benefit of One's Own: Older Women's Entitlement to Social Security Retirement JF - Social Security Bulletin Y1 - 2000 A1 - Phillip B. Levine A1 - Olivia S. Mitchell A1 - John W R Phillips KW - Consumption and Savings KW - Health Conditions and Status KW - Methodology KW - Retirement Planning and Satisfaction KW - Social Security KW - Women and Minorities AB - Using data from the Health and Retirement Study (HRS) and linked administrative records, we explore differences in old-age benefits between men and women attributable to differences in length of work life and pay. We find that most women are fully insured for Social Security purposes, but those who are not would have to work substantially more to become eligible. Among those who are eligible, additional work would translate into only slightly higher benefits. PB - 63 VL - 63 UR - https://www.ssa.gov/policy/docs/ssb/v63n3/v63n3p47.pdf IS - 3 N1 - RDA 1996-006 ProCite field 3 : Wellesley College; U PA; US Social Security Administration U4 - Social Security and Public Pensions/Economics of Gender/Economics of the Elderly/Retirement/Retirement Policies/Old/Social Security/Women ER - TY - CHAP T1 - Developments in Pensions T2 - Handbook of Insurance Y1 - 2000 A1 - Olivia S. Mitchell ED - Dionne, Georges KW - Insurance KW - Pensions AB - A single reference source for professors, researchers, graduate students, regulators, consultants and practitioners, the book starts with the history and foundations of risk and insurance theory, followed by a review of prevention and precaution, asymmetric information, risk management, insurance pricing, new financial innovations, reinsurance, corporate governance, capital allocation, securitization, systemic risk, insurance regulation, the industrial organization of insurance markets and other insurance market applications. It ends with health insurance, longevity risk, long-term care insurance, life insurance financial products and social insurance. JF - Handbook of Insurance PB - Kluwer Academic Publishers CY - Boston/Dordrecht/London UR - https://www.springer.com/us/book/9781461401544 N1 - ProCite field 6 : In ProCite field 8 : ed. U4 - Insurance/Pensions ER - TY - CHAP T1 - Early Retirement Windows T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Charles Brown ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - Net Worth and Assets KW - Retirement Planning and Satisfaction JF - Forecasting Retirement Needs and Retirement Wealth PB - Univ. of Pennsylvania Press CY - Philadelphia UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ N1 - ProCite field 8 : eds U4 - Retirement/Early out Windows/Wealth/Retirement Planning JO - Early Retirement Windows ER - TY - CHAP T1 - Evaluating Pension Entitlements T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Alan L Gustman A1 - Olivia S. Mitchell A1 - Andrew A. Samwick A1 - Thomas L. Steinmeier ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - Net Worth and Assets KW - Pensions KW - Public Policy JF - Forecasting Retirement Needs and Retirement Wealth PB - University of Pennsylvania Press CY - Philadelphia UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ N1 - RDA 1996-005; Revision of Pension Research Council Working Paper 98-20 ProCite field 8 : eds. U4 - Pensions/Entitlements/Wealth ER - TY - CHAP T1 - Explaining Retirement Saving Shortfalls T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Olivia S. Mitchell A1 - James Moore A1 - John W R Phillips ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - consumption KW - Savings JF - Forecasting Retirement Needs and Retirement Wealth PB - University of Pennsylvania Press CY - Philadelphia UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ N1 - RDA 1996-002; Revision of Pension Research Council Working Paper 98-13 ProCite field 6 : In ProCite field 8 : eds. U4 - Retirement Saving ER - TY - BOOK T1 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Olivia S. Mitchell A1 - P. Brett Hammond A1 - Anna M. Rappaport KW - Consumption and Savings KW - Health Conditions and Status KW - Healthcare KW - Pensions KW - Retirement Planning and Satisfaction KW - Women and Minorities AB - Thirteen papers draw on data from the Health and Retirement Study and from other sources to explore people's preparation for and the financial challenges of retirement in the United States. Papers discuss new paths to retirement; how prepared Americans are for retirement; projected retirement wealth and saving adequacy; individual savings and investment choices associated with 401(k) plans; factors explaining retirement savings shortfalls; women's economic well -being at the end of their work lives and the factors that appear to be associated with the poorer economic status of older women relative to older men; the prospects for widow poverty; minorities facing retirement; early retirement windows; the relationship between people's expectations about their retirement, their realizations of retirement, and the role of health shocks in this process; planning for health care needs in retirement; the evaluation of pension entitlements; social security earnings and projected benefits. Mitchell is at the Wharton School, University of Pennsylvania. Hammond is with the Teachers Insurance Annuity Association-College Retirement Equities Fund (TIAA -CREF). Rappaport is at William M. Mercer, Inc. Index. PB - University of Pennsylvania Press CY - Philadelphia, PA UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ N1 - RDA 1996-002 ProCite field 8 : eds. U4 - Retirement/Retirement Policies/Economics of the Elderly/401(k) participation and balances/Women/Minorities/Health Care/Health Shocks ER - TY - RPRT T1 - A Framework for Analyzing and Managing Retirement Risks Y1 - 2000 A1 - Olivia S. Mitchell A1 - Zvi Bodie KW - Retirement Planning and Satisfaction AB - This paper provides an overview of new approaches and products to help people assess and meet their old-age security goals. We first examine retirement planning models and conclude that many do not yet incorporate key types of uncertainty deemed essential to economists and finance experts, including cross-asset correlations. Many financial planners also fall short of using the full range of tools of risk management – hedging, insurance, and diversification – to guide those making retirement plans. Turning to innovation, we examine several financial products that appear to offer new opportunities to protect against old-age risk. These products include inflation-linked annuities, survivor bonds, long-term care insurance, and reverse annuity mortgages. Some of the innovations arise from bundling existing insurance products. We also suggest that the arrival of new products to market that could protect retirement income have been slowed by market failures and institutional rigidities as well as information barriers; these have limited international diversification in investments, among other outcomes. There remains a profoundly important role for additional economic and financial research to better inform stakeholders on the costs and benefits of developing innovative products for retirement security PB - University of Pennsylvania UR - https://d1wqtxts1xzle7.cloudfront.net/44924857/A_Framework_for_Analyzing_and_Managing_R20160420-17161-ufe5km.pdf?1461169548=&response-content-disposition=inline%3B+filename%3DA_Framework_for_Analyzing_and_Managing_R.pdf&Expires=1593708427&Signature=ZBcdaC U4 - Retirement Policies/Retirement Planning ER - TY - CHAP T1 - Minorities Face Retirement: Worklife Disparities Repeated? T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Honig, Marjorie ED - Olivia S. Mitchell ED - P. Brett Hammond ED - Anna M. Rappaport KW - Consumption and Savings KW - Retirement Planning and Satisfaction KW - Women and Minorities JF - Forecasting Retirement Needs and Retirement Wealth PB - University of Pennsylvania Press CY - Philadelphia UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ N1 - ProCite field[3]: CUNYProCite field[6]: InProCite field[8]: eds. U4 - Economics of the Elderly/Economics of Minorities/Retirement/Retirement Policies/Minorities/Retirement ER - TY - RPRT T1 - Mortality Risk, Inflation Risk, and Annuity Products Y1 - 2000 A1 - Brown, Jeffrey R. A1 - Olivia S. Mitchell A1 - James M. Poterba KW - Annuitization KW - Mortality KW - Older Adults KW - Risk Factors AB - As growing numbers of retirees reach retirement age with substantial balances in self-directed retirement plans, annuities are likely to become increasingly important instruments for drawing down retirement savings. This study explores recent trends in the pricing of single-premium annuity products in the United States. Virtually all of the annuity products currently available in the United States offer fixed nominal payouts, rather than an inflation-linked payout stream. After describing the money's worth' of the various types of nominal annuity products, this study considers the extent to which existing U.S. private annuity markets provide retirees with inflation-protected retirement income flows. Although there is effectively no market yet for inflation-indexed annuities in the United States, such products are available in other countries. The paper concludes by summarizing recent data on the pricing of both nominal and inflation-linked annuities in the United Kingdom and several other nations. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - https://www.nber.org/papers/w7812.pdf ER - TY - CHAP T1 - New Paths to Retirement T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Joseph F. Quinn ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - Consumption and Savings KW - Employment and Labor Force KW - Net Worth and Assets KW - Retirement Planning and Satisfaction JF - Forecasting Retirement Needs and Retirement Wealth PB - Univ. of Pennsylvania Press CY - Philadelphia UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ N1 - ProCite field 8 : eds. U4 - Economics of the Elderly/Retirement/Retirement Wealth/Retirement Policies/Labor Force/Employment JO - New Paths to Retirement ER - TY - CHAP T1 - Projected Retirement Wealth and Saving Adequacy in the Health and Retirement Study T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - James Moore A1 - Olivia S. Mitchell ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - Consumption and Savings KW - Net Worth and Assets AB - In the future it is likely that retirees will have to take on more of the burden of ensuring their own well-being then is now the case. This is because of the growing population over the age of 65 that is causing the social security surplus to wither away and the ongoing trend toward defined contribution retirement plans rather then defined benefit plans. However, household savings rates have plunged over the last half-century and this causes one to wonder how people will maintain their current consumption levels when retired. The authors use the first wave (1992) of the Health and Retirement Study in order to illustrate a life cycle model of savings. These researchers also look at initial and projected wealth, savings needs, replacement rates, and income. They find that the median current wealth of older households is 325,000, including retirement plans and assets, and they feel that at retirement the median wealth will be 380,000. At the same time though the median older household will need a savings rate of 16 in order to maintain current consumption levels in retirement. JF - Forecasting Retirement Needs and Retirement Wealth PB - Univ. of Pennsylvania Press CY - Philadelphia UR - https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ N1 - RDA 1996-002; Revision of NBER Working Paper No. 6240 ProCite field 8 : eds. U4 - Wealth/Saving/Retirement Wealth ER - TY - CHAP T1 - Prospects for Widow Poverty T2 - Forecasting retirement needs and retirement wealth. Y1 - 2000 A1 - David R Weir A1 - Robert J. Willis ED - Olivia S. Mitchell ED - P. Brett Hammond ED - Anna M. Rappaport KW - Consumption and Savings KW - Methodology KW - Net Worth and Assets KW - Retirement Planning and Satisfaction JF - Forecasting retirement needs and retirement wealth. T3 - Pension Research Council Publications.: PB - University of Pennsylvania Press CY - Philadelphia N1 - ProCite field[8]: eds. U4 - Widowhood/Economics of the Elderly/Economics of Gender/Measurement and Analysis of Poverty/Retirement/Retirement Policies JO - Prospects for Widow Poverty ER - TY - CHAP T1 - Retirement Expectations and Realizations: The Role of Health Shocks and Economic Factors T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Debra S. Dwyer A1 - Hu, Jianting ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - Expectations KW - Health Conditions and Status KW - Retirement Planning and Satisfaction AB - This chapter explores the relationship between peoples' expectations about retirement, their realizations of retirement, and the role of health shocks in this process. We look at how accurately people predict retirement and we examine the determinants of changes in retirement expectations. Expectations are made under uncertainty about future health, labor force status, household characteristics, and economic variables; therefore plans must frequently be updated with new information. While many factors influence the decision to retire, we are specifically interested in the role of health shocks in peoples' decisions to alter their plans to retire. Research to date has recognized the importance of understanding the relationship between health and retirement; however, until now, information about health, work, and economic well-being was difficult to obtain in a single survey. The Health and Retirement Study (HRS) is the first national survey to combine comprehensive data on all of these areas. Nevertheless much of the early HRS research has used only the first wave of data, at which time many in the cohort were too young to retire. In this chapter we use new information on this group of people from wave 2, enabling us to observe this cohort moving into retirement. In what follows we first offer a brief discussion of the literature, and then discuss empirical models, data used in the analysis, results and conclusions. JF - Forecasting Retirement Needs and Retirement Wealth PB - Univ. of Pennsylvania Press CY - Philadelphia UR - https://www.researchgate.net/publication/23739676_Retirement_Expectations_and_Realizations_The_Role_of_Health_Shocks_and_Economic_Factors N1 - ProCite field 8 : eds. U4 - Retirement Expectations/Health Shocks/Retirement Planning JO - Retirement Expectations and Realizations: The Role of Health Shocks and Economic Factors ER - TY - RPRT T1 - Retirement Responses to early Social Security Benefit Reductions Y1 - 2000 A1 - Olivia S. Mitchell A1 - John W R Phillips KW - Disabilities KW - Employment and Labor Force KW - Event History/Life Cycle KW - Health Conditions and Status KW - Income KW - Insurance AB - Respondents who retire early are similar initially, in terms of their health, education, and wealth, to those who subsequently elect the normal retirement path. Both groups are healthier and better educated than those who take disability retirement. Analysis of the life-cycle budget constraint shows that cutting early Social Security benefits would have an uneven effect on beneficiaries. Respondents who are black, have lower levels of education, and are in poor health would suffer relatively large losses. This study finds that a cut in early Social Security benefits would result in more workers delaying benefit acceptance as opposed to taking disability benefits. PB - National Bureau of Economic Research UR - http://www.nber.org/papers/w7963 U4 - Economic Status--income, Social Security benefits/Health Status/Labor--work histories, type of retirement taken/Insured Status/Disability/Disability/Life-Cycle ER - TY - CHAP T1 - Social Security Earnings and Projected Benefits T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Olivia S. Mitchell A1 - Olson, Jan A1 - Thomas L. Steinmeier ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - Pensions KW - Social Security JF - Forecasting Retirement Needs and Retirement Wealth PB - Univ. of Pennsylvania Press CY - Philadelphia U4 - Social Security/Benefits JO - Social Security Earnings and Projected Benefits ER - TY - CHAP T1 - Women on the Verge of Retirement: Predictors of Retiree Well-Being T2 - Forecasting Retirement Needs and Retirement Wealth Y1 - 2000 A1 - Phillip B. Levine A1 - Olivia S. Mitchell A1 - James Moore ED - Olivia S. Mitchell ED - Hammond, B. ED - Rappaport, A. KW - Retirement Planning and Satisfaction KW - Women and Minorities JF - Forecasting Retirement Needs and Retirement Wealth PB - University of Pennsylvania Press CY - Philadelphia UR - https://www.researchgate.net/publication/23739651_Women_on_the_Verge_of_Retirement_Predictors_of_Retiree_Well-being N1 - RDA 1996-002; Revision of Pension Research Council Working Paper 97-2 ProCite field 6 : In ProCite field 8 : eds. U4 - Women/Retirement Planning JO - Women on the Verge of Retirement: Predictors of Retiree Well-Being ER - TY - JOUR T1 - Health problems as determinants of retirement: are self-rated measures endogenous? JF - J Health Econ Y1 - 1999 A1 - Debra S. Dwyer A1 - Olivia S. Mitchell KW - Health Services Research KW - Health Status Indicators KW - Humans KW - Male KW - Models, Statistical KW - Retirement KW - Self-Assessment KW - United States AB -

We explore alternative measures of unobserved health status in order to identify effects of mental and physical capacity for work on older men's retirement. Traditional self-ratings of poor health are tested against more objectively measured instruments. Using the Health and Retirement Study (HRS), we find that health problems influence retirement plans more strongly than do economic variables. Specifically, men in poor overall health expected to retire one to two years earlier, an effect that persists after correcting for potential endogeneity of self-rated health problems. The effects of detailed health problems are also examined in depth.

PB - 18 VL - 18 IS - 2 N1 - RDA ProCite field 3 : US Social Security Administration; U PA U1 - http://www.ncbi.nlm.nih.gov/pubmed/10346352?dopt=Abstract U4 - Retirement/Retirement Policies/Health Production--Nutrition, Mortality, Morbidity, Disability, and Economic Behavior/Health Status/Retirement Planning ER - TY - CHAP T1 - New Developments in the Economic Analysis of Retirement T2 - Handbook of labor economics. Volume 3C Y1 - 1999 A1 - Lumsdaine, Robin L. A1 - Olivia S. Mitchell ED - Ashenfelter, Orley ED - Card, David KW - Consumption and Savings KW - Employment and Labor Force KW - Pensions KW - Retirement Planning and Satisfaction KW - Social Security JF - Handbook of labor economics. Volume 3C T3 - Handbooks in Economics PB - Elsevier Science, North-Holland CY - Amsterdam; New York and Oxford UR - https://eml.berkeley.edu/~saez/course/lumsdaine-mitchell1999handbook.pdf IS - 5 N1 - ProCite field[3]: Brown U; U PAProCite field[8]: eds. U4 - Retirement/Retirement Policies/Economics of the Elderly/Social Security and Public Pensions/Nonwage Labor Costs and Benefits/Private Pensions/Labor Force--Demographics/Retirement JO - New Developments in the Economic Analysis of Retirement ER - TY - JOUR T1 - New Evidence on the Money's Worth of Individual Annuities JF - The American Economic Review Y1 - 1999 A1 - Olivia S. Mitchell A1 - James M. Poterba A1 - Mark J. Warshawsky A1 - Brown, Jeffrey R. KW - Age KW - Annuity payments KW - Income taxes KW - Insurance premiums KW - Life annuities KW - Life insurance KW - Life Tables KW - Men KW - Mortality rates VL - 89 SN - 00028282 UR - https://www.jstor.org/stable/117059?seq=1 IS - 5 ER - TY - CHAP T1 - Pension and Social Security Wealth in the Health and Retirement Study T2 - Wealth, Work and Health: Innovations in Measurement in the Social Sciences Y1 - 1999 A1 - Alan L Gustman A1 - Olivia S. Mitchell A1 - Andrew A. Samwick A1 - Thomas L. Steinmeier ED - James P Smith ED - Robert J. Willis KW - Net Worth and Assets KW - Pensions KW - Social Security AB - 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. JF - Wealth, Work and Health: Innovations in Measurement in the Social Sciences PB - University of Michigan Press CY - Ann Arbor, MI N1 - RDA 1996-005; Revision of Pension Research Council Working Paper PRC WP 97-3 ProCite field 8 : eds. U4 - Pensions/Social Security/Wealth JO - Pension and Social Security Wealth in the Health and Retirement Study ER - TY - BOOK T1 - Prospects for Social Security Reform T2 - Pension Research Council Publications Y1 - 1999 A1 - Olivia S. Mitchell A1 - Myers, Robert A1 - Young, Howard KW - Older Adults KW - Retirement Planning and Satisfaction KW - Social Security JF - Pension Research Council Publications PB - University of Pennsylvania Press CY - Philadelphia SN - 9780812234794 UR - https://www.upenn.edu/pennpress/book/4266.html#:~:text=Prospects%20for%20Social%20Security%20Reform%20informs%20the%20debate%20by%20exploring,reform%20might%20affect%20the%20economy. ER - TY - CONF T1 - Would a Privatized Social Security System Really Pay a Higher Rate of Return? T2 - First Annual Joint Conference for the Retirement Research Consortium, "New Developments in Retirement Research" Y1 - 1999 A1 - John Geanakoplos A1 - Olivia S. Mitchell A1 - Stephen P. Zeldes AB - Many advocates of social security privatization argue that rates of return under a defined contribution individual account system would be much higher for all than they are under the current social security system. This claim is false. The mistake comes from ignoring accrued benefits already promised based on past payroll taxes, and from underestimating the riskiness of stock investments. Confusion arises because three distinct reforms are muddled. By privatization we mean creating individual accounts (which could, for example, be invested exclusively in bonds). By diversification we mean investing in stocks, and perhaps other assets, as well as bonds; diversification might be undertaken either by individuals in their private social security accounts, or by the social security trust fund. By prefunding we mean closing the gap between social security benefits promised to date and the assets on hand to pay for them. Any one of these reforms could be implemented without the other two. If the system were completely privatized, with no prefunding or diversification, the social security system would need to raise new taxes in order to pay benefits already accrued. These added taxes would completely eliminate any rate of return advantage on the individual accounts. If the economy continued to grow at rates comparable to the last 25 years, and if real interest rates remained at levels comparable to their long run historical average, then the new taxes would amount to 3% of payroll in perpetuity (which is a quarter of today's social security taxes). Unlike diversification, prefunding would raise rates of return for later generations, but at the cost of lower returns for today's workers. For households able to invest in the stock market on their own, diversification would not raise rates of return, correctly adjusted to recognize risk. Households that are constrained from holding stock, due to lack of wealth outside of social security or to fixed costs from holding stocks, would gain higher risk-adjusted returns and would benefit from diversification. If this group is large, diversification would raise stock values, thus helping current stockholders, but it would lower future stock returns, thus hurting young unconstrained households. Overall, since the number of truly constrained households is probably not that large, privatization and diversification would have a much smaller effect on returns than reformers typically claim. JF - First Annual Joint Conference for the Retirement Research Consortium, "New Developments in Retirement Research" UR - https://www0.gsb.columbia.edu/mygsb/faculty/research/pubfiles/474/gmzwd98.pdf ER - TY - JOUR T1 - Can Americans Afford to Retire? New Evidence on Retirement Saving Adequacy JF - Journal of Risk and Insurance Y1 - 1998 A1 - Olivia S. Mitchell A1 - James Moore KW - Net Worth and Assets KW - Retirement Planning and Satisfaction AB - This paper looks at the recent research regarding retirement wealth accumulation and decumulation and assesses whether Americans are doing a reasonable job of preparing for retirement, and spending down while in the retirement phase. PB - 65 VL - 65 UR - https://www-jstor-org.proxy.lib.umich.edu/stable/253656?Search=yes&resultItemClick=true&searchText=Can&searchText=Americans&searchText=Afford&searchText=to&searchText=Retire&searchText=New&searchText=Evidence&searchText=on&searchText=Retirement&searchText IS - 3 N1 - RDA 1996-002; HRS 1992 U4 - Economic Status--wealth/Retirement Wealth/Retirement Planning ER - TY - CHAP T1 - Effects of Pensions on Household Wealth Accumulation: Implications of the Shift Toward Defined Contribution Plans T2 - Living With Defined Contribution Pensions Y1 - 1998 A1 - William G. Gale A1 - Milano, Joseph ED - Olivia S. Mitchell ED - Scheiber, S. KW - Net Worth and Assets KW - Pensions AB - Pension wealth constitutes a sizable portion of households' retirement resources. Close to half of civilian nonagricultural workers participate in pension plans.' Future income flows from private pensions accounted for 20 percent of the wealth of households aged 65-69 in 1991 (Poterba, Venti, and Wise 1994, table 1). Thus the relation between pensions and other household wealth can have important implications for policy issues, such as how to raise the saving rate or assure adequate saving for retirement, as well as for more fundamental issues, such as how people make economic decisions about the future. JF - Living With Defined Contribution Pensions PB - Univ. of Pennsylvania Press and Pension Research Council UR - https://pensionresearchcouncil.wharton.upenn.edu/wp-content/uploads/2015/09/0-8122-3439-1-6.pdf N1 - ProCite field 6 : In ProCite field 8 : eds. U4 - 401(k) participation and balances/Wealth Accumulation JO - Effects of Pensions on Household Wealth Accumulation: Implications of the Shift Toward Defined Contribution Plans ER - TY - RPRT T1 - The Impact of Pay Inequality, Occupational Segregation, and Lifetime Work Experience on Retirement Income of Women and Minorities Y1 - 1998 A1 - Olivia S. Mitchell A1 - Phillip B. Levine A1 - John W R Phillips KW - Demographics KW - Housing KW - Income KW - Net Worth and Assets KW - Pensions KW - Social Security KW - Women and Minorities AB - In this study the researchers review data on earnings and search for differences between men and women, as well as, differences between whites and minorities. Specifically, the researchers examine Social Security, employer-provided pensions, and financial assets, like homes. Observations and analysis of the data show that occupational segregation along with pay differences explain the vast majority of the retirement income differences. Most of the pay difference between men and women is in the form of pension size. Many interesting findings are given with possible explanations and ways of fixing the discrepancies. Cross-tabulations are done to show differences between the married and non-married, as well. N1 - RDA U4 - Earnings and Benefits File/Social Security and Public Pensions/Pensions/Retirement Incomes/Assets/Housing Equity/Female/Minorities/Whites ER - TY - RPRT T1 - International Models for Pension Reform Y1 - 1998 A1 - Olivia S. Mitchell KW - Methodology KW - Pensions KW - Public Policy PB - University of Pennsylvania UR - https://repository.upenn.edu/prc_papers/525/ U4 - Pensions/Public Policy/Cross Cultural Comparison ER - TY - CHAP T1 - Privatizing Social Security: First Round Effects of a Generic Voluntary Privatized U.S. Social Security System T2 - Privatizing Social Security Y1 - 1998 A1 - Alan L Gustman A1 - Olivia S. Mitchell A1 - Thomas L. Steinmeier ED - Feldstein, M.S. KW - Methodology KW - Public Policy KW - Social Security JF - Privatizing Social Security PB - University of Chicago Press CY - Chicago, IL N1 - ProCite field 8 : ed. U4 - Social Security Research/Privatization/Public Policy JO - Privatizing Social Security: First Round Effects of a Generic Voluntary Privatized U.S. Social Security System ER - TY - RPRT T1 - Retirement Wealth Accumulation and Decumulation: New Developments and Outstanding Opportunities Y1 - 1998 A1 - Olivia S. Mitchell A1 - James Moore KW - Money KW - Retirement KW - Retirement wealth KW - Wealth AB - Analysts have raised questions about current workers' ability and inclination to save" enough for retirement. This issue is of obvious policy interest given the current debate over" reforming national retirement income programs. This paper explores the implications of recent" research regarding retirement wealth accumulation and decumulation for this debate. Our goal is" to identify problems and opportunities in the area of preparedness for retirement." PB - NBER UR - http://www.nber.org/papers/w6178 ER - TY - JOUR T1 - Building Better Retirement Income Models JF - North American Actuarial Journal Y1 - 1997 A1 - Bone, Christopher M. A1 - Olivia S. Mitchell KW - Methodology KW - Retirement Planning and Satisfaction AB - There is a strong and immediate need to collect more data and to construct better retirement income policy models. In the very near future, changes must be made to the U.S. retirement policy. These changes and the policy itself will only be effective if it is based on strong retirement models. The article describes recent efforts and developments that may interest those concerned with retirement issues. The HRS is praised for its ability to obtain the necessary information on older workers that has for so long been missing from the field of retirement research. PB - 1 VL - 1 IS - 1 U4 - Models, Econometric/Retirement Policies ER - TY - RPRT T1 - The Competitive Performance of Life Insurance Firms in the Retirement Asset Market Y1 - 1997 A1 - Chorney, Harris R. A1 - Goldman, Jill A1 - Olivia S. Mitchell A1 - Santomero, Anthony M. KW - Insurance AB - This paper summarizes the findings of the joint Wharton Financial Institutions Center and KPMG study of the retirement assets market and the role of life insurance companies within it. The study began with the following goals: Investigate how people save for retirement and whether this is adequate. Determine the primary products and institutions of the retirement asset market and observe how these have changed through time. Key findings: For most, asset accumulation is less than adequate for a comfortable retirement. The average worker exhibits little of the needed financial understanding to adequately plan for retirement. Upon retirement, households do not spend down their assets optimally. The retirement asset market is rapidly expanding. Products in retirement portfolios have shifted with time. The market share of mutual funds has exploded, mostly at the expense of depository institutions. Life insurance companies maintain a large, but slipping share. PB - University of Pennsylvania UR - https://www.researchgate.net/publication/23739464_The_Competitive_Performance_of_Life_Insurance_Firms_in_the_Retirement_Asset_Market U4 - Life Insurance ER - TY - RPRT T1 - New Evidence on the Money's Worth of Individual Annuities Y1 - 1997 A1 - Olivia S. Mitchell A1 - James M. Poterba A1 - Mark J. Warshawsky KW - Annuitization KW - Economics KW - Retirement Planning and Satisfaction AB - This paper presents new information on the expected present discounted value of payouts on individual life annuities. The annuity we examine is the single premium immediate life annuity, an insurance product that pays out a nominal level sum as long as the covered person lives, in exchange for an initial lump-sum premium. This annuity offers protection against the risk of someone outliving his saving, given uncertainty about longevity. For reasonable estimates of behavioral parameters, we calculate that individual annuities are currently priced so that retirees without bequest motives should find these policies of substantial value in configuring their portfolios to smooth retirement consumption. We also find that the expected present discounted value of payouts, relative to the initial cost of the annuity, has increased over the last decade. These findings bear on the policy debate regarding the role of individual choice and self-reliance in retirement planning. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w6002.pdf ER - TY - RPRT T1 - Pension and Social Security Wealth in the Health and Retirement Study Y1 - 1997 A1 - Alan L Gustman A1 - Olivia S. Mitchell A1 - Andrew A. Samwick A1 - Thomas L. Steinmeier KW - Consumption and Savings KW - Income KW - Medicare/Medicaid/Health Insurance KW - Methodology KW - Net Worth and Assets KW - Pensions KW - Retirement Planning and Satisfaction KW - Social Security AB - Together, pensions, social security and health insurance account for half of the wealth held by all households in the Health and Retirement Study (HRS), for 60 percent of total wealth of HRS households who are in the 45th to 55th wealth percentiles, and even for 48 percent of wealth for those in the 90th to 95th wealth percentiles. The HRS surveys households aged 51 to 61 in 1992, and obtains pension plan descriptions from respondents' employers. Pension accrual profiles, income and wealth distributions by type, wealth-income ratios and accrued wealth by pension status are also explored. PB - National Bureau of Economic Research UR - https://www.nber.org/papers/w5912 N1 - ProCite field 8 : Dartmouth College and NBER U4 - Personal Income and Wealth Distribution/Macroeconomics:/Saving/Social Security and Public Pensions/Economics of the Elderly/Retirement/Retirement Policies/Private Pensions/Health Insurance/Pension/Retirement/Social Security/Wealth ER - TY - RPRT T1 - Projected Retirement Wealth and Savings Adequacy in the Health and Retirement Study Y1 - 1997 A1 - James Moore A1 - Olivia S. Mitchell KW - Consumption and Savings KW - Health Conditions and Status KW - Net Worth and Assets KW - Pensions KW - Retirement Planning and Satisfaction KW - Social Security AB - Low saving rates raise questions about Americans' ability to maintain consumption levels in old age. Using the Health and Retirement Study, this paper explores asset holdings among a nationally representative sample of people on the verge of retirement. The authors assess how much more people would need to save in order to preserve consumption levels after retirement. They find that the median older household has current wealth of approximately 325,000 including pensions, social security, housing, and other financial wealth, an amount projected to grow to about 380,000 by retirement at age 62. Nevertheless, their model suggests that this median household will still need to save 16 of annual earnings to preserve pre-retirement consumption. For retirement at age 65, assets are expected to be 420,000 and required additional saving totals 7 of earnings per year. These summary statistics conceal extraordinary heterogeneity in both assets and saving needs in the older population. PB - National Bureau of Economic Research UR - https://www.nber.org/papers/w6240 N1 - RDA ProCite field 8 : Wharton School; Wharton School and NBER U4 - Macroeconomics: Consumption/Saving/Pension Funds/Other Private Financial Institutions/Institutional Investors/Social Security and Public Pensions/Economics of the Elderly/Retirement/Retirement Policies/Aging/Savings/Retirement/Consumption/Wealth ER - TY - JOUR T1 - Review of: Aging and Old Age JF - Journal of Economic Literature Y1 - 1997 A1 - Olivia S. Mitchell KW - Consumption and Savings KW - Demographics KW - Health Conditions and Status PB - 35 VL - 35 IS - 1 N1 - ProCite field 3 : U of PA U4 - Economics of the Elderly/Aging/Demographics/Old Age ER - TY - RPRT T1 - Construction of the Earnings and Benefits File (EBF) for Use With the Health and Retirement Survey Y1 - 1996 A1 - Olivia S. Mitchell A1 - Olson, Jan A1 - Thomas L. Steinmeier KW - Employment and Labor Force KW - Income KW - Methodology KW - Social Security AB - Analysts using the Health and Retirement Survey (HRS) often require information on earnings, labor market attachment, and social security benefits in order to better understand the factors affecting retirement and well-being at older ages. To this end, several derived variables were constructed and documented in the Earnings and Benefits File (EBF) described here. The EBF provides a set of summary earnings, employment, and social security wealth measures for a subset of HRS respondents in Wave 1 of the survey, for whom administration records are available. The EBF, a restricted data file, is available from the University of Michigan's Institute for Social Research for matching only with versions of the HRS containing geographic detail no finer than the Census Division level. Interested users should contact hrsquest umich.edu by email for further information on access to the data. PB - National Bureau of Economic Research N1 - ProCite field 8 : U PA and NBER; Social Security Administration; TX Tech U U4 - Social Security and Public Pensions/Record Linkages/Social Security Research/Labor Force Attachment/Earnings and Benefits File/Income ER - TY - RPRT T1 - Construction of the Earnings and Benefits File (EBF) for Use with the Health and Retirement Study Y1 - 1996 A1 - Olivia S. Mitchell A1 - Olson, Jan A1 - Thomas L. Steinmeier KW - Methodology KW - Social Security AB - Analysts using the Health and Retirement Survey (HRS) often require information on earnings, labor market attachment, and social security benefits in order to better understand the factors affecting retirement and well-being at older ages. To this end, several derived variables were constructed and documented in the Earnings and Benefits File (EBF) described here. The EBF provides a set of summary earnings, employment, and social security wealth measures for a subset of HRS respondents in Wave 1 of the survey, for whom administrative records are available. The EBF, a restricted data file, is available from the University of Michigan's Institute for Social Research for matching only with versions of the HRS containing geographic detail no finer than the Census Division level. Interested users should contact hrsquest@umich.edu by email for further information on access to the data. PB - University of Pennsylvania U1 - Note - An updated and revised version of this paper is available in Forecasting Retirement Needs and Retirement Wealth, Olivia S. Mitchell, P. Brett Hammond and Anna M. Rappaport, eds., Philadelphia: University of Pennsylvania Press, 2000. See Chapter 13, "Social Security Earnings and Projected Benefits" U4 - Social Security/Record Linkages/Earnings and Benefits File ER - TY - JOUR T1 - Older Union and Nonunion Workers and their Jobs in the Health and Retirement Survey JF - Proceedings: Industrial Relations Research Association Y1 - 1995 A1 - Alan L Gustman A1 - Olivia S. Mitchell A1 - Thomas L. Steinmeier KW - Employment and Labor Force KW - Retirement Planning and Satisfaction AB - This paper compares a variety of factors associated with retirement between those who are covered by a union on their job and those who are not. Despite the well-publicized decline in union coverage and the elimination of opportunities in the union sector, union members approaching retirement age seem to be enjoying the same benefits they would have when unions were stronger. Union membership among this cohort is still 25 for men and almost 20 for women. Results show that these union members have much higher coverage by pensions and health insurance than non-members. These pension plans are likely to be defined benefit plans and therefore are more likely to encourage early retirement, making these holders more likely to expect to retire earlier. PB - January VL - January U4 - Labor/Union Status/Retirement Behavior ER - TY - JOUR T1 - Retirement Measures in the Health and Retirement Survey JF - The Journal of Human Resources Y1 - 1995 A1 - Alan L Gustman A1 - Olivia S. Mitchell A1 - Thomas L. Steinmeier KW - Demographics KW - Retirement Planning and Satisfaction AB - The HRS offers researchers the opportunity to explore a vast amount of detailed information that will help to answer outstanding questions about retirement. The survey provides new information, based on better measures than have ever been available before, that could help evaluate current programs and improve future policy design. The following areas of the HRS are praised for providing excellent data that will help researchers answer outstanding questions: labor, economic status, health status, family, and disability plan participation. Unique features such as administrative records on earnings and SS benefits and employer-provided data on pensions and health insurance are also described. PB - 30 VL - 30 IS - Supplement 1995 U4 - Retirement/Retirement Policies/Demographic Trends and Forecasts ER - TY - JOUR T1 - The Role of Pensions in the Labor Market: A Survey of The Literature JF - Industrial and Labor Relations Review Y1 - 1994 A1 - Alan L Gustman A1 - Olivia S. Mitchell A1 - Thomas L. Steinmeier KW - Employment and Labor Force KW - Pensions AB - This review of recent research on pensions explores how pensions influence employee compensation, retirement, turnover, and other matters central to the determination of labor's price and quantity over time. The paper discusses the various reasons why employers offer pension plans, the benefits they get out of them, and the reasons why employees want them. The HRS is mentioned as a footnote to the explanation of the two primary types of benefit plans- - defined contribution (DC) and defined benefit (DB). HRS data indicates that among the 67 of workers who were covered by a pension, 43 were covered by a DB plan only, 29 by a DC plan only, and 26 had a combination of the two. PB - 47 VL - 47 U4 - Pension/Labor Supply ER -