%0 Journal Article %J Journal of Pension Economics and Finance %D 2019 %T The Affordable Care Act as retiree health insurance: implications for retirement and Social Security claiming %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Affordable Care Act %K Pensions %K Policy %K Retirement Planning and Satisfaction %K Social Security %X This paper investigates the effects of the Affordable Care Act (ACA) on retirement. The first part of the paper is a difference-in-difference analysis of changes in retirement (and retirement expectations) before and after adoption of the ACA. We find no statistically significant evidence that ACA increased the propensity to retire or changed retirement expectations. The second part of the analysis is based on a structural retirement model. For those age 50 at the time ACA was introduced, the overall reduction in full-time work over the age span 54–65 is simulated to be about 0.1 percentage points. Data are from the Health and Retirement Study. %B Journal of Pension Economics and Finance %V 18 %P 415-449 %G eng %U https://www.cambridge.org/core/journals/journal-of-pension-economics-and-finance/article/affordable-care-act-as-retiree-health-insurance-implications-for-retirement-and-social-security-claiming/24601D49E42B0714381FC2B9F4D55D10 %N 3 %9 Journal %! Journal of Pension Economics and Finance %R 10.1017/S1474747218000033 %0 Report %D 2016 %T The Affordable Care Act as Retiree Health Insurance: Implications for Retirement and Social Security Claiming %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Affordable Care Act %K Health Insurance %K Older Adults %K Retirement Planning and Satisfaction %K Social Security %X Using data from the Health and Retirement Study, we examine the effects of the Affordable Care Act (ACA) on retirement. We first calculate retirements (and in related analyses changes in expected ages of retirement and/or Social Security claiming) between 2010, before ACA, and 2014, after ACA, for those with health insurance at work but not in retirement. This group experienced the sharpest change in retirement incentives from ACA. We then compare retirement measures for those with health insurance at work but not in retirement with retirement measures for two other groups, those who, before ACA, had employer provided health insurance both at work and in retirement, and those who had no health insurance either at work or in retirement. To complete a difference-in-difference analysis, we make the same calculations for members of an older cohort over the same age span. We find no evidence that ACA increases the propensity to retire or changes the retirement expectations of those who, before ACA, had coverage when working but not when retired. %B NBER Working Paper Series %I National Bureau of Economic Research %C Cambridge, MA %P 1-55 %8 11/2016 %G eng %U http://www.nber.org/papers/w22815.pdf %R 10.3386/w22815 %0 Report %D 2016 %T Distributional Effects of Means Testing Social Security: An Exploratory Analysis %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Net Worth and Assets %K Public Policy %K Social Security %X This paper examines the distributional implications of introducing additional means testing of Social Security benefits where proceeds are used to help balance Social Security's finances. Benefits of the top quarter of households ranked according to the relevant measure of means are reduced using a modified version of the Social Security Windfall Elimination Provision (WEP). The replacement rate in the first bracket of the benefit formula, determining the Primary Insurance Amount (PIA), would be reduced from 90 percent to 40 percent of Average Indexed Monthly Earnings (AIME). Four measures of means are considered: total wealth; an annualized measure of AIME; the wealth value of pensions; and a measure of average indexed lifetime W2 earnings. The empirical analysis is based on data from the Health and Retirement Study. These means tests would reduce total lifetime household benefits by 7 to 9 percentage points. We find that the basis for means testing Social Security makes a substantial difference as to which households have their benefits reduced, and that different means tests may have different effects on the benefits of families in similar circumstance. We also find that the measure of means used to evaluate the effects of a means test makes a considerable difference as to how one would view the effects of the means test on the distribution of benefits. %B NBER Working Paper Series %I Cambridge, MA, National Bureau of Economic Research %P 1-28 %G eng %4 social Security/Public Policy/means testing/wealth/pension wealth %$ 999999 %0 Journal Article %J Journal of Pension Economics and Finance %D 2014 %T Mismeasurement of pensions before and after retirement: the mystery of the disappearing pensions with implications for the importance of Social Security as a source of retirement support %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Net Worth and Assets %K Pensions %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X A review of the literature suggests that when pension values are measured by the wealth equivalent of promised defined benefit pension benefits and defined contribution balances for those approaching retirement, pensions account for more support in retirement than is suggested when their contribution is measured by incomes received directly from pension plans by those who have already retired. Estimates from the Health and Retirement Study for respondents in their early fifties suggest that pension wealth is about 82 as valuable as Social Security wealth. In data from the Current Population Survey (CPS), for members of the same cohort, measured when they are 65-69, pension incomes are about 58 as valuable as incomes from Social Security. Our empirical analysis uses data from the HRS to examine the reasons for these differences in the contributions of pensions as measured in income and wealth data. Key factors accounting for these differences include: a difference in methodology between surveys affecting what is included in pension income; some pension wealth 'disappears' at retirement because respondents change their pension into other forms that are not counted as pension income; and the form of annuitization may influence the measure of pension income. A series of caveats notwithstanding, the bottom line is that CPS data on pension incomes received in retirement understates the full contribution pensions make to supporting retirees. PUBLICATION ABSTRACT %B Journal of Pension Economics and Finance %I 13 %V 13 %P 1-26 %G eng %N 1 %4 pensions/retirement planning/Public Policy/social security wealth/wealth/Defined benefit plans/Defined contribution pension plans/pension income %$ 69340 %0 Journal Article %J Social Security Bulletin %D 2014 %T The Social Security Windfall Elimination and Government Pension Offset Provisions for Public Employees in the Health and Retirement Study %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Employment and Labor Force %K Income %K Pensions %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X This article uses Health and Retirement Study data to investigate the effects of Social Security's Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) on Social Security benefits received by households. The provisions reduce benefits for individuals or the dependents of individuals whose work histories include jobs for which they were entitled to a pension and were not subject to Social Security payroll taxes ( noncovered employment). We find that about 3.5 percent of households are subject to either the WEP or the GPO, and that the provisions reduce the present value of their Social Security benefits by roughly one-fifth. Households affected by both provisions experience benefit reductions of about one-third. Under the WEP, the Social Security benefit reduction is capped at one-half of the amount of the pension from noncovered employment, which substantially reduces the WEP penalty and prevents the WEP adjustment from falling disproportionately on households in the lowest earnings category. %B Social Security Bulletin %I 74 %V 74 %P 55-69 %G eng %N 3 %4 Retirement Policies/Wage Level and Structure/Wage Differentials/Public Sector Labor Markets/labor Force Participation/Earnings/Pensions/Public Employee/Social Security/Windfall Elimination Provision/Government Pension Offset %$ 999999 %0 Journal Article %J Journal of Pension Economics and Finance %D 2013 %T Redistribution under the Social Security benefit formula at the individual and household levels, 1992 and 2004 %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Adult children %K Income %K Pensions %K Social Security %K Women and Minorities %X Studies using data from the early 1990s suggested that while the progressive Social Security benefit formula succeeded in redistributing benefits from individuals with high earnings to individuals with low earnings, it was much less successful in redistributing benefits from households with high earnings to households with low earnings. Wives often earned much less than their husbands. As a result, much of the redistribution at the individual level was effectively from high earning husbands to their own lower earning wives. In addition, spouse and survivor benefits accrue disproportionately to women from high income households. Both factors mitigate redistribution at the household level. It has been argued that with the increase in the labor force participation and earnings of women, Social Security now should do a better job of redistributing benefits at the household level. To be sure, when we compare outcomes for a cohort with a household member age 51 to 56 in 1992 with those from a cohort born twelve years later, redistribution at the household level has increased over time. Nevertheless, as of 2004 there still is substantially less redistribution of benefits from high to low earning households than from high to low earning individuals. %B Journal of Pension Economics and Finance %I 12 %V 12 %P 1-27 %G eng %N 1 %4 Social Security/Redistribution/Benefits/Spouse benefits/Survivor benefits/Benefit formula/Womens earnings/Family %$ 69144 %R 10.1017/s1474747212000108 %0 Report %D 2013 %T The Social Security Windfall Elimination and Government Pension Offset Provisions for Public Employees in the Health and Retirement Study %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X This paper uses data from the Health and Retirement Study to investigate the effects of Social Security s Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) provision on Social Security benefits received by individuals and households. WEP reduces the benefits of individuals who worked in jobs covered by Social Security and also worked in uncovered jobs where a pension was earned. WEP also reduces spouse benefits. GPO reduces spouse and survivor benefits for persons who worked in uncovered government employment where they also earned a pension. Unlike previous studies, we take explicit account of pensions earned on jobs not covered by Social Security, a key determinant of the size of WEP and GPO adjustments. Also unlike previous studies, we focus on the household. This allows us to incorporate the full effects of WEP and GPO on spouse and survivor benefits, and to evaluate the effects of WEP and GPO on the assets accumulated by affected families. Among our specific findings: About 3.5 percent of households are subject to either WEP or to GPO. The present value of their Social Security benefits is reduced by roughly one fifth. This amounts to five to six percent of the total wealth they accumulate before retirement. Households affected by both WEP and GPO lose about one third of their benefit. Limiting the Social Security benefit to half the size of the pension from uncovered employment reduces the penalty from WEP for members of the original HRS cohort by about 60 percent. %I Ann Arbor, The University of Michigan %G eng %U http://www.mrrc.isr.umich.edu/publications/papers/pdf/wp288.pdf %4 public Pensions/retirement planning/social Security/Public Policy/government pension offset/windfall elimination provision %$ 69116 %0 Journal Article %J The American Economic Review %D 2012 %T Financial Knowledge and Financial Literacy at the Household Level %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Net Worth and Assets %K Other %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X There is evidence of a relation between numeracy and wealth held outside of pensions and Social Security. With pensions and Social Security accounting for half of wealth at retirement, and evidence that those with pensions save more in other forms, one would expect to find knowledge of pensions and Social Security influencing retirement saving. Yet we find no evidence that knowledge of pensions and Social Security is related to nonpension, non-Social Security wealth, to numeracy, or that it plays an intermediate role in the numeracy-wealth relation. Our findings raise questions about policies that would enhance numeracy to increase retirement saving. PUBLICATION ABSTRACT %B The American Economic Review %I 102 %V 102 %P 309-313 %G eng %N 3 %4 numeracy/retirement planning/social security/Wealth/public policy %$ 69526 %R 10.1257/aer.102.3.309 %0 Journal Article %J Soc Secur Bull %D 2012 %T The growth in Social Security benefits among the retirement-age population from increases in the cap on covered earnings. %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Aged %K Cohort Studies %K Female %K Humans %K Insurance Benefits %K Male %K Middle Aged %K Models, Econometric %K Public Policy %K Salaries and Fringe Benefits %K Social Security %K Taxes %K United States %X

Analysts have proposed raising the maximum level of earnings subject to the Social Security payroll tax (the "tax max") to improve long-term Social Security Trust Fund solvency. This article investigates how raising the tax max leads to the "leakage" of portions of the additional revenue into higher benefit payments. Using Health and Retirement Study data matched to Social Security earnings records, we compare historical payroll tax payments and benefit amounts for Early Boomers (born 1948-1953) with tax and benefit simulations had they been subject to the tax max (adjusted for wage growth) faced by cohorts 12 and 24 years older. We find that 43.2 percent of the additional payroll tax revenue attributable to tax max increases affecting Early Boomers relative to taxes paid by the cohort 12 years older leaked into higher benefits. For Early Boomers relative to those 24 years older, we find 53.5 percent leakage.

%B Soc Secur Bull %I 72 %V 72 %P 49-61 %8 2012 %G eng %U https://www.ssa.gov/policy/docs/ssb/v72n2/v72n2p49.html %N 2 %1 http://www.ncbi.nlm.nih.gov/pubmed/22799138?dopt=Abstract %4 Social security/payroll tax/Public policy/retirement planning/taxation %$ 69572 %0 Report %D 2011 %T The Effects of Changes in Women s Labor Market Attachment on Redistribution Under the Social Security Benefit Formula %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Employment and Labor Force %K Income %K Pensions %K Social Security %K Women and Minorities %X Studies using data from the early 1990s suggested that while the progressive Social Security benefit formula succeeded in redistributing benefits from individuals with high earnings to individuals with low earnings, it was much less successful in redistributing benefits from households with high earnings to households with low earnings. Wives often earned much less than their husbands. As a result, much of the redistribution at the individual level was effectively from high earning husbands to their own lower earning wives. In addition, spouse and survivor benefits accrue disproportionately to women from high income households. Both factors mitigate redistribution at the household level. This paper compares outcomes for the earlier cohort with those of a cohort born twelve years later. With greater growth in women's earnings, the aim of the study is to see whether, after the recent growth in two earner households, and the growth in women's labor market activity and earnings, the Social Security system now fosters somewhat more redistribution from high to low earning households. We use data from the Health and Retirement Study to study a population consisting of members of households with at least one person age 51 to 56 in either 1992 or in 2004. We use four different measures of redistribution: the ratio of the present value of benefits to taxes for households arrayed by decile of covered earnings; the fraction of total Social Security benefits redistributed from households with high earnings to those with low earnings; the share of total benefits paid to members of each cohort redistributed from households falling in the highest deciles of earners to those with lower covered earnings; and the rate of return to Social Security taxes for members with different amounts of covered earnings. Considering differences in earnings between cohorts, women enjoyed a more rapid growth of labor force participation, hours of work and covered earnings than men. This increased the redistribution of Social Security benefits among households. Nevertheless, a considerable gap remains between the labor market activities and earnings of women versus men. As a result, the Social Security system remains much less successful in redistributing benefits from households with high covered earnings to those with lower covered earnings than in redistributing benefits from individuals with high covered earnings to those with lower covered earnings. %B Michigan Retirement and Disability Research Center Working Paper %I Michigan Retirement and Disability Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://deepblue.lib.umich.edu/bitstream/handle/2027.42/86250/wp248.pdf?sequence=1 %4 social Security/benefit Formulas/Redistribution/labor Force Participation/women %$ 62644 %0 Report %D 2009 %T What the Stock Market Decline Means for the Financial Security and Retirement Choices of the Near-Retirement Population %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Consumption and Savings %K Net Worth and Assets %K Social Security %X This paper investigates the effect of the current recession on the near-retirement age population. Data from the Health and Retirement Study suggest that those approaching retirement age (early boomers ages 53 to 58 in 2006) have only 15.2 percent of their wealth in stocks, held directly or in defined contribution plans or IRAs. Their vulnerability to a stock market decline is limited by the high value of their Social Security wealth, which represents over a quarter of the total household wealth of the early boomers. In addition, their defined contribution plans remain immature, so their defined benefit plans represent sixty five percent of their pension wealth. Simulations with a structural retirement model suggest the stock market decline will lead the early boomers to postpone their retirement by only 1.5 months on average. Health and Retirement Study data also show that those approaching retirement are not likely to be greatly or immediately affected by the decline in housing prices. We end with a discussion of important difficulties facing those who would use labor market policies to increase the employment of older workers. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %L newpubs20091202_w15435.pdf %4 Wealth/Stock Market/Retirement Saving/Retirement Wealth/Social Security expectations %$ 21420 %R 10.3386/w15435