%0 Book Section %B Reimagining Pensions: The Next 40 Years %D 2016 %T Are Retirees Falling Short? Reconciling the Conflicting Evidence %A Alicia H. Munnell %A Matthew S. Rutledge %A Anthony Webb %E Olivia S. Mitchell %E Shea, Richard C. %K Net Worth and Assets %K Retirement Planning and Satisfaction %X 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. %B Reimagining Pensions: The Next 40 Years %I Oxford University Press %C Oxford, United Kingdom %P 11-36 %G eng %4 household consumption/retirement preparedness/pre-retirement standard of living %! Are Retirees Falling Short? Reconciling the Conflicting Evidence %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 Race and Social Problems %D 2016 %T Diverging Fortunes: Racial/Ethnic Inequality in Wealth Trajectories in Middle and Late Life %A Tyson H Brown %K Event History/Life Cycle %K Health Conditions and Status %K Inequality %K Net Worth and Assets %K Older Adults %K Racial/ethnic differences %X The primary aim of this study is to examine whether racial/ethnic inequality in wealth dissipates or increases between middle and late life, and by how much. To address this aim, this study draws on critical race and life course perspectives as well as 10 waves of panel data from the Health and Retirement Study and growth curve models to understand racial/ethnic inequality in wealth trajectories among whites, blacks, and Mexican Americans (N = 8337). Findings show that, by midlife, significant inequalities in net worth emerge between whites and their black and Mexican American counterparts. On average, white households have amassed a net worth of 105k by midlife, compared to less than 5k and 39k among black and Mexican American families, respectively. Moreover, whites experience much more rapid rates of wealth accumulation during their 50s and 60s than their minority counterparts, resulting in increasing wealth disparities with age, consistent with a process of cumulative disadvantage. At the peak of their wealth trajectory (at age 66), whites have approximately 245k more than blacks and 219k more than Mexican Americans. A wide range of socioeconomic, behavioral, and health factors account for a portion, but not all, of racial/ethnic inequality in wealth, suggesting that unobserved factors such as parental wealth, segregation, and discrimination may play a role in the production and maintenance of wealth inequality. %B Race and Social Problems %I 8 %V 8 %P 29-41 %G eng %U http://dx.doi.org/10.1007/s12552-016-9160-2 %N 1 %R 10.1007/s12552-016-9160-2 %0 Journal Article %J Public Finance Review %D 2016 %T The Great Recession, Housing Wealth, and the Retirement Decisions of Older Workers %A Jan I Ondrich %A Falevich, Alexander %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X To determine how asset values of older workers affect their future retirement decisions, it is important to take into account how asset values change over asset cycles. This study uses Health and Retirement Study data from waves 1992 through 2010 together with restricted Social Security Administration data on respondents occupation to estimate models of the age at first self-reported retirement for the subsample of married males. The model covariates include demographic variables, workplace variables, nonhousing financial wealth, and housing equity. The proportional hazard estimates are, for the most part, significant and of the correct sign. The estimated models suggest that declines in housing wealth during the Great Recession lowered retirement probabilities of married males by as much as 14 percent to 17 percent. This delay was offset in cases where the household had defined benefit or contribution pensions. %B Public Finance Review %I 44 %V 44 %P 109-131 %G eng %U http://pfr.sagepub.com/content/early/2014/10/24/1091142114551600.abstract %N 1 %4 retirement/housing wealth/retirement wealth/Great Recession/retirement planning %$ 999999 %R 10.1177/1091142114551600 %0 Journal Article %J Journal of Finance %D 2016 %T Health and Mortality Delta: Assessing the Welfare Cost of Household Insurance Choice %A Koijen, Ralph S. J. %A Van Nieuwerburgh, Stijn %A Yogo, Motohiro %K Health Conditions and Status %K Insurance %K Net Worth and Assets %K Pensions %X We develop a pair of risk measures, health and mortality delta, for the universe of life and health insurance products. A life-cycle model of insurance choice simplifies to replicating the optimal health and mortality delta through a portfolio of insurance products. We estimate the model to explain the observed variation in health and mortality delta implied by the ownership of life insurance, annuities including private pensions, and long-term care insurance in the Health and Retirement Study. For the median household aged 51 to 57, the lifetime welfare cost of market incompleteness and suboptimal choice is 3.2 of total wealth. %B Journal of Finance %I 71 %V 71 %P 957-1010 %G eng %N 2 %4 mortality/life Insurance/annuities/pensions %$ 999999 %R 10.1111/jofi.12273 %0 Journal Article %J Cesifo Economic Studies %D 2016 %T Housing Wealth and Retirement Timing %A Martin P. Farnham %A Purvi Sevak %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Labor-supply effects of changes in house value are potentially important but empirically neglected. Using the panel Health and Retirement Study merged to local house prices from the Federal Housing Finance Agency, we estimate the effect of house-price changes on actual and planned retirement timing. While we find no effect of house-price changes on the annual probability of retiring, we find that people respond to rising house prices by revising down their expected retirement age. We estimate that a 10 real increase in house value reduces expected retirement age by about 4 months. Our findings suggest that movements in the housing market may have important labor supply implications, especially in areas experiencing steep price declines. %B Cesifo Economic Studies %I 62 %V 62 %P 26-46 %G eng %N 1 %4 retirement planning/labor Supply/House price fluctuations/labor Force Participation %$ 999999 %R 10.1093/cesifo/ifv015 %0 Journal Article %J Social Science and Medicine %D 2016 %T How does dementia onset in parents influence unmarried adult children's wealth %A Arora, Kanika %K Adult children %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %X There is a growing concern that long-term care (LTC) needs of older adults lead to negative financial consequences for their family members. This paper examines whether the onset of dementia in parents influences wealth change among unmarried adult children regardless of their status as informal caregivers. Longitudinal data from seven waves (1998-2010) of the Health and Retirement Study (1540 person-wave observations) are used to analyze this question. Unconditional quantile regressions demonstrate that as a result of parental dementia diagnosis, unmarried adult children have lower wealth accumulation above the median of the wealth change distribution. These effects are more pronounced for unmarried adult children without siblings. Further, this response is observed to persist in the subsequent period as well. Both losses in labor income and nursing home expenditures may play a role in leading to wealth declines. %B Social Science and Medicine %I 152 %V 152 %P 156-165 %G eng %4 Long Term Care/Dementia/adult Children/informal caregiver/wealth Accumulation %$ 999999 %R 10.1016/j.socscimed.2016.01.042 %0 Journal Article %J Journal of Economic and Social Measurement %D 2016 %T Prescription drug coverage and drug utilization: New evidence from the HRS prescription drug study %A Gary V. Engelhardt %K Healthcare %K Insurance %K Net Worth and Assets %X The linking of detailed information on health, medical care, and insurance to economic outcomes is a central feature of data collection efforts in the economics of aging. In this paper, I use newly available linked panel data from a unique supplement to the Health and Retirement Study (HRS) known as the Prescription Drug Study (PDS) to examine the impact of insurance coverage on prescription drug utilization for those 65 and older. Fixed-effect estimates suggest that gaining coverage resulted in a 15 increase in utilization. Gaining coverage also was associated with a 20-50 reduction in the incidence of cost-related non-adherence. However, even among the uninsured, only a relatively small proportion of drugs (12 ) were associated with episodes of cost-related non-adherence. %B Journal of Economic and Social Measurement %I 41 %V 41 %P 49-65 %G eng %N 1 %4 Prescription drug costs/insurance Coverage/economics of Aging %$ 999999 %R 10.3233/JEM-150418 %0 Journal Article %J CLINICAL GERONTOLOGIST %D 2016 %T Psychological and Functional Vulnerability Predicts Fraud Cases in Older Adults: Results of a Longitudinal Study %A Peter A Lichtenberg %A Sugarman, Michael A. %A Daniel Paulson %A Ficker, Lisa J. %A Rahman-Filipiak, Annalise %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %X Using cross sectional data Psychological vulnerability was identified as a correlate of older adults being defrauded. We extend that research by examining fraud prevalence using longitudinal data from the Health and Retirement Study, and to identify the best predictors of fraud longitudinally across a 4-year time frame. Whereas reported fraud prevalence was 5.0 in a 5-year look-back period in 2008, it increased to 6.1 in 2012. The rate of new-incident fraud across only a 4-year look-back was 4.3 . Being younger-old, having a higher level of education, and having more depression significantly predicted the new cases of fraud reported in 2012. Psychological vulnerability was a potent longitudinal predictor of fraud, with the most vulnerable individuals being more than twice as likely to be defrauded. Results indicate that fraud victimization among older adults is rising, and that vulnerability variables, along with some demographic variables, predict new cases of fraud. %B CLINICAL GERONTOLOGIST %I 39 %V 39 %P 48 %G eng %N 1 %4 financial exploitation/Fraud/psychological vulnerability/COGNITIVE STATUS/ELDER MISTREATMENT %$ 999999 %0 Journal Article %J The Journals of Gerontology Series B: Psychological Sciences and Social Sciences %D 2016 %T Responses to Financial Loss During the Great Recession: An Examination of Sense of Control in Late Midlife %A Shannon T. Mejia %A Richard A. Settersten Jr. %A Michelle C Odden %A Hooker, Karen %K Adult children %K Demographics %K Healthcare %K Net Worth and Assets %K Other %K Public Policy %X Objectives. The Great Recession shocked the primary institutions that help individuals and families meet their needs and plan for the future. This study examines middle-aged adults experiences of financial loss and considers how socioeconomic and interpersonal resources facilitate or hinder maintaining a sense of control in the face of economic uncertainty.Method. Using the 2006 and 2010 waves of the Health and Retirement Study, change in income and wealth, giving help to and receiving help from others, household complexity, and sense of control were measured among middle-aged adults (n = 3,850; age = 51 60 years).Results. Socioeconomic resources predicted both the level of and change in the engagement of interpersonal resources prior to and during the Great Recession. Experiences of financial loss were associated with increased engagement of interpersonal resources and decreased sense of control. The effect of financial loss was dampened by education. Sense of control increased with giving help and decreased with household complexity.Discussion. Findings suggest that, across socioeconomic strata, proportional loss in financial resources resulted in a loss in sense of control. However, responses to financial loss differed by socioeconomic status, which differentiated the ability to maintain a sense of control following financial loss. %B The Journals of Gerontology Series B: Psychological Sciences and Social Sciences %V 71 %P 734-744 %G eng %U http://psychsocgerontology.oxfordjournals.org/content/early/2015/08/21/geronb.gbv054.abstract %N 4 %4 Agency/Financial loss/Great recession/Household complexity/Intergenerational transfers/Interpersonal resources/Sense of control/Structure %$ 999999 %& 734 %R 10.1093/geronb/gbv054 %0 Journal Article %J EBRI Notes %D 2016 %T Trends in Retirement Satisfaction in the United States: Fewer Having a Great Time %A Sudipto Banerjee %K Health Conditions and Status %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X Most of the existing research on overall retirement satisfaction of retirees uses single-year data and focuses on identifying and measuring the factors that may affect retirement satisfaction. However, the analysis presented in this paper uses data from the 1998-2012 rounds of the Health and Retirement Study (HRS) to illustrate longer trends in retirement satisfaction and the relationships with various other factors. The cross-sectional results in this study show that the share of respondents reporting very satisfying retirements dropped from 60.5 percent in 1998 to 48.6 percent in 2012. On the other hand, the share of respondents reporting moderately satisfying and not at all satisfying retirements increased from 31.7 percent to 40.9 percent and from 7.9 percent to 10.5 percent, respectively. The longitudinal results from a fixed sample observed over the 15-year period from 1998 to 2012 show similar declines in the share of respondents reporting very satisfying retirements and similar increases in the share of respondents reporting moderately satisfying retirements. This is in contrast to some of the previous research, which shows that retirement satisfaction increases with age. These trends are not limited to particular economic groups: Both the highest- and lowest-asset quartiles show similar trends. Also, people with and without pension income show similar trends in retirement satisfaction levels. As might be expected, net worth and health status are strongly correlated with retirement satisfaction. Higher net worth is associated with higher levels of satisfaction, and poorer health is associated with lower levels of satisfaction. There is no significant difference in retirement satisfaction levels between men and women. Although this study does not investigate the reasons behind the changes in retirement satisfaction levels, the reported shift in the retirement satisfaction trends raises an important question: Why is the share of very satisfied retirees dropping? Further research to answer this question might provide some important answers. %B EBRI Notes %I 37 %V 37 %P 1-12 %G eng %N 4 %4 Health status/Household assets/Net worth/Pension income/Retireme/Retirement attitudes and opinions/Satisfaction %$ 999999 %0 Journal Article %J Journal of Political Economy %D 2015 %T Adverse Selection in the Annuity Market and the Role for Social Security %A Hosseini, Roozbeh %K Net Worth and Assets %K Pensions %K Social Security %X I study the role of social security in providing insurance when there is adverse selection in the annuity market. I calculate welfare gain from mandatory annuitization in the social security system relative to a laissez-faire benchmark, using a model in which individuals have private information about their mortality. I estimate large heterogeneity in mortality using the Health and Retirement Study. Despite that, I find small welfare gain from mandatory annuitization. Social security has a large effect on annuity prices because it crowds out demand by high-mortality individuals. Welfare gain would have been significantly larger in the absence of this effect. %B Journal of Political Economy %I 123 %V 123 %P 941-984 %G eng %N 4 %4 Social Security/annuities/mandatory annuitization %$ 999999 %R 10.1086/681593 %0 Journal Article %J Public Finance Review %D 2015 %T Are the Elderly Responsive in Their Savings Behavior to Changes in Asset Limits for Medicaid? %A Nadia Greenhalgh-Stanley %K Adult children %K Insurance %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Other %X In light of recent policy discussions aimed at reforming Medicaid, it is important to understand how the elderly respond to changes in the incentives of Medicaid. This article estimates the effect of a decrease in the implicit tax of holding assets brought about by the Medicare Catastrophic Coverage Act of 1988. Using the Health and Retirement Study (HRS), I find that a 1 increase in state asset protections increased median total wealth holdings by 0.20, financial wealth by 0.04, and home equity by 0.27. As expected, larger responses are found for residents of states with income limits in place prior to the law change and for states that chose the highest level of protected resource amounts. %B Public Finance Review %I 43 %V 43 %P 324-346 %G eng %U http://pfr.sagepub.com/content/early/2013/12/26/1091142113515047.abstract %N 3 %4 widows/Medicare/catastrophic/coverage act/wealth accumulation of widows %$ 999999 %R 10.1177/1091142113515047 %0 Journal Article %J Journal of Public Economics %D 2015 %T Asset accumulation and labor force participation of disability insurance applicants %A Shu, Pian %K Consumption and Savings %K Disabilities %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %K Other %K Social Security %K Women and Minorities %X This paper provides empirical evidence of the existence of forward-looking asset-accumulation behavior among disability-insurance applicants, previously examined only in the theoretical literature. Using panel data from the RAND Health and Retirement Study, I show that rejected applicants for Social Security Disability Insurance (SSDI) possess significantly more assets than accepted applicants immediately prior to application and exhibit lower attachment to the labor force. These empirical results are consistent with the theoretical prediction in Diamond and Mirrlees (1978) and Golosov and Tsyvinski (2006) that certain individuals with high unwillingness to work maximize utility by planning in advance for their future disability insurance application. Because the existing empirical literature on disability insurance does not account for this intertemporal channel, it may underestimate the total work-disincentive effect of SSDI. (C) 2015 Elsevier B.V. All rights reserved. %B Journal of Public Economics %I 129 %V 129 %P 26-40 %G eng %4 Asset accumulation/Disability insurance/Labor force participation/disability insurance/Asset accumulation/Disability/Disability/Economics of the Elderly,/Economics of the Handicapped/Non-labor Market Discrimination/Social Security/Health Behavior/Participation/Labor supply %$ 999999 %R 10.1016/j.jpubeco.2015.06.002 %0 Report %D 2015 %T Change in Household Spending After Retirement: Results from a Longitudinal Sample %A Sudipto Banerjee %K Consumption and Savings %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper shows how household spending changed in the immediate years following retirement by analyzing the spending patterns of a fixed group of households up to six years after their retirement. Two sources of data are used for this study. First is the Health and Retirement Study (HRS), which is a study of a nationally representative sample of U.S. households with individuals over age 50. The other source of data is the Consumption and Activities Mail Survey (CAMS), which was started in 2001 as a supplement to the HRS. The data show that household spending dropped at the beginning of retirement. In the first two years of retirement, median household spending dropped by 5.5 percent from preretirement spending levels, and by 12.5 percent by the third or fourth year of retirement. But the spending reduction slowed down after the fourth year. Although average spending in retirement fell, a large percentage of households experienced higher spending following retirement. In the first two years of retirement, 45.9 percent of households spent more than what they had spent just before retirement. This declined to 33.4 percent by the sixth year of retirement. Households that spent more in the first two years of retirement were not exclusively high-income households; rather they were distributed similarly across income levels. In the first two years of retirement, 2 in 5 households (39.3 percent) spent less than 80 percent of their preretirement spending. By the sixth year of retirement, a majority (53.1 percent) of households did so. In the first two years of retirement, 28.0 percent of households spent more than 120 percent of their preretirement spending. By the sixth year of retirement, 23.4 percent of households still did so. A very small percentage of the household budget was spent on durable goods. The median household (half above and half below) spent nothing on durables in retirement. Transportation spending showed the highest drop in the first two years of retirement. Median spending on transportation went down by 25.1 percent in the first two years of retirement, although the reduction in subsequent years was small. The median household had a mortgage payment before retirement but none after retirement. %I Washington, DC, Employee Benefit Research Institute %G eng %4 Consumption/Household spending/Household spending/Income/Retirement %$ 999999 %0 Journal Article %J Journal of Consumer Affairs %D 2015 %T Cognitive Ability and the Stock Reallocations of Retirees during the Great Recession %A Chris Browning %A Michael S. Finke %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X Retirees are increasingly responsible for managing their retirement savings. The ability to manage these assets efficiently can have an important impact on retirement well-being. Lower levels of cognitive ability in old age can reduce an investor's ability to control emotional responses to a loss. Greater sensitivity to loss may increase preferences for safety following a market decline, resulting in allocations away from stocks that are associated with long-term underperformance. We investigate whether cognitive ability is related to stock reallocations among retirees during the Great Recession. Using the Health and Retirement Study, we find that cognitive ability is negatively related to allocations away from stock. Compared to those with the lowest levels of cognitive ability, respondents with higher cognitive ability are 40 less likely to reduce their stock allocation by 50 or more. These results suggest that the quality of investment decisions in old age may be compromised by cognitive decline. %B Journal of Consumer Affairs %I 49 %V 49 %P 356-375 %G eng %N 2 %4 retirement savings/assets/health shocks/cognitive ability/stock reallocations/Great Recession/Cognitive decline %$ 999999 %R 10.1111/joca.12065 %0 Journal Article %J Journal of Pension Economics and Finance %D 2015 %T Debt literacy, financial experiences, and overindebtedness %A Annamaria Lusardi %A Peter Tufano %K Healthcare %K Methodology %K Net Worth and Assets %K Other %X We analyze a national sample of Americans with respect to their debt literacy, financial experiences, and their judgments about the extent of their indebtedness. Debt literacy is a component of broader financial understanding that measures knowledge about debt and self-assessed financial knowledge. Financial experiences are the participants' reported experiences with traditional borrowing, alternative borrowing, and investing. Overindebtedness is a self-reported measure. Debt literacy is low, with only about one-third of the population grasping the basics of interest compounding. Even after controlling for demographics, we find a relationship between debt literacy and both financial experiences and debt loads. Individuals with lower levels of debt literacy tend to transact in high-cost manners, incurring higher fees and using high-cost borrowing. We provide a rough estimate of the national implications of debt ignorance on credit card costs by consumers. Less knowledgeable individuals also report that their debt loads are excessive or that they are unable to judge their debt position. %B Journal of Pension Economics and Finance %I 14 %V 14 %P 332 %G eng %N 4 %4 debt loads/credit card borrowing/BEHAVIOR/numeracy/BUSINESS, FINANCE/DEFAULT/ECONOMICS/HOUSEHOLD FINANCE/Financial knowledge %$ 999999 %0 Report %D 2015 %T Declining Wealth and Work Among Male Veterans in the Health and Retirement Study %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Demographics %K Net Worth and Assets %X The composition, wealth and employment of male veterans and nonveterans are analyzed for four cohorts from the Health and Retirement Study, ages 51 to 56 in 1992, 1998, 2004 and 2010. Half of the men in the two oldest cohorts served in the military. Only 16 percent of the men in the youngest cohort, the only cohort subject to the All-Volunteer Military, served. One fifth to one third of the members of each cohort who served saw combat, mainly in Viet Nam and in the First Gulf War. Among those 51 to 56 in 1992, veterans were better educated, healthier, wealthier, and more likely to be working than nonveterans. By the 2010 cohort, 51 to 56 year old veterans had lost their educational advantage over nonveterans, were less healthy, less wealthy and less likely to be working. After standardizing in multiple regressions for the influence of major observable characteristics, for the original 1992 HRS cohort the wealth of veterans is no longer higher than the wealth of nonveterans. In contrast, the wealth of veterans from the youngest cohort, those 51 to 56 in 2010, remains about 10 to 13 percent below the wealth of nonveterans from that cohort. There also is a decline from older to younger cohorts of veterans compared to nonveterans in the probability of being not retired, of working more than 35 hours per week, and in the likelihood of holding a job for more than 10 years. Comparisons are made within the group of veterans by years of service, officer rank and other covariates. %I Cambridge, MA, National Bureau of Economic Research %G eng %4 veterans/Vietnam War/Gulf War/WEALTH %$ 999999 %0 Thesis %D 2015 %T Demand for Long-Term Care and Long-Term Care Insurance -- A Human Capital Perspective %A Dey, Sanjoy %Y Ehrlich, Isaac %K Healthcare %K Insurance %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %X The dissertation examines several aspects of the demand for long-term care and long-term care insurance. It develops and applies a comprehensive "full insurance" model analytically in order to empirically estimate the pattern of relationship between private long-term care insurance and other non-marketable alternatives: self-insurance, self-protection, family insurance and safety-net insurance. It therefore allows us to estimate the degree to which demand for private long-term care insurance is substituted or complemented by its non-marketable alternatives. We explicitly explore the crowding out of private long-term care insurance by Medicaid. The role of education and health in the demand for long-term care and long-term care insurance is the primary focus of this study. Individuals with better education and health expect to live longer; they can purchase this insurance product in better health during their late middle age and get rewarded by insurance companies in the form of lower premiums. Medicaid turns out to be an expensive insurance option for them as it carries a high deductible for people with high income and wealth, and an educated person is aware of the potential financial risk associated with future utilization of long-term care services. While conventional wisdom would suggest that the primary effect of education on demand for long-term care insurance operates through an income effect, the paper carefully shows, both theoretically and empirically that it is the knowledge effect and an independent health effect that have the most influence. The spectrum of knowledge effect goes beyond its immediate relevance for the labor market. The paper tries to provide a complex analysis of interactions of different forms of insurances from a broader human capital perspective. The dissertation carefully explores the primary statistically significant determinants of demand for long-term care with the specific focus on the role of private LTCI coverage in determining the choice of mode of care. The dissertation also delves into an empirical investigation to understand the relationship between private insurance coverage and ultimate utilization of long-term care services in different specific caregiving institutional frameworks. The thesis pays explicit attention to different arguments of demand function of private LTCI and future utilization of long-term care. We explore the decision taken by an individual to purchase private long-term care insurance in different strata of wealth distribution. Our comprehensive analysis provides a useful instrument to develop business strategies regarding forecasting future demand for private long-term care insurance for the firms operating in long-term care insurance industry. Our analysis can also be utilized to evaluate implications of any changes in public policies. %I State University of New York at Buffalo %C Buffalo, NY %V 3714584 %P 119 %8 2015 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1700219388?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+Full+Text&rft_val_fmt=info:ofi/ %9 Ph.D. %M 1700219388 %4 0501:Economics %! Demand for Long-Term Care and Long-Term Care Insurance -- A Human Capital Perspective %0 Journal Article %J Journal of Family and Economic Issues %D 2015 %T Divorce/Separation in Later-Life: A Fixed Effects Analysis of Economic Well-Being by Gender %A Sharma, Andy %K Adult children %K Methodology %K Net Worth and Assets %K Public Policy %X With the on-going aging of the United States population and an increase in the number of older men and women living in a divorced/separated state, examining the economic security of this group is a worthwhile undertaking. Utilizing the 2004 and 2010 waves of the RAND Health and Retirement Study, this study employed fixed effects (FE) regression to examine the effects of divorce/separation on total wealth for older men and women. Results suggested older divorced/separated individuals endured a significant loss in total wealth due to a martial disruption and women fared worse than men. However, older adults can take proactive steps to ease this financial setback. %B Journal of Family and Economic Issues %I 36 %V 36 %P 299-306 %G eng %U http://dx.doi.org/10.1007/s10834-014-9432-1 %N 2 %4 Divorce/separation/Economic well-being/Marital dissolution in later-life/marital Status/household wealth/Marriage %$ 999999 %R 10.1007/s10834-014-9432-1 %0 Report %D 2015 %T Do Households Increase Their Savings When the Kids Leave Home? %A Irena Dushi %A Alicia H. Munnell %A Geoffrey T. Sanzenbacher %A Anthony Webb %K Consumption and Savings %K Event History/Life Cycle %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X Much of the disagreement over whether households are adequately prepared for retirement reflects differences in assumptions regarding the extent to which consumption declines when the kids leave home. If consumption declines substantially when the kids leave home, as some life-cycle models of retirement saving assume, households need to achieve lower replacement rates in retirement and need to accumulate less wealth. Using administrative tax data from the Health and Retirement Study (HRS), as well as the Survey of Income and Program Participation (SIPP), this paper investigates whether household consumption declines when kids leave the home and, if so, by how much. Because consumption data are noisy and savings is the flip side of consumption, this paper examines whether savings in 401(k) plans increase when the kids leave home. The paper also investigates alternative methods of saving, including non-401(k) savings and increased mortgage payments. %I Boston College %G eng %4 retirement planning/survey of Income and Program Participation/household consumption/savings/401(k) participation and balances/life cycle models %$ 999999 %0 Report %D 2015 %T Does Investors' Personality Influence Their Portfolios? %A Alessandro Bucciol %A Luca Zarri %K Health Conditions and Status %K Methodology %K Net Worth and Assets %K Risk Taking %X Based on large-scale survey data from the 2006-2012 waves of the US Health and Retirement Study (HRS) we show that individual portfolio decisions are influenced by a variety of traits and facets traditionally investigated in the field of personality psychology. Two personality traits that taken together depict a self-centered personality profile have the most significant impact on financial risk taking: lower Agreeableness and higher Cynical Hostility predict higher willingness to take risks. The effects of Agreeableness seem to pass through the preferences rather than the beliefs channel. Our findings shed new light on the non-cognitive side of individuals risk taking. %I Tilburg, Netherlands, Netspar %G eng %4 Portfolio choice/personality traits/risk taking/behavioral finance %$ 999999 %0 Book Section %B Challenges of Latino Aging in the Americas %D 2015 %T The Economic Security of Latino Baby Boomers: Implications for Future Retirees and for Healthcare Funding in the U.S. %A Zachary Gassoumis %A Kathleen H. Wilber %A Torres-Gil, Fernando M. %E William A. Vega %E Kyriakos S Markides %E Jacqueline L. Angel %E Torres-Gil, Fernando M. %K Consumption and Savings %K Healthcare %K Net Worth and Assets %K Public Policy %K Women and Minorities %B Challenges of Latino Aging in the Americas %I Springer %C New York %P 355-378 %G eng %4 health Care Costs/Latinos/economic security/Public Policy/economic disparity %$ 999999 %! The Economic Security of Latino Baby Boomers: Implications for Future Retirees and for Healthcare Funding in the U.S. %& 21 %0 Journal Article %J Journal of Family and Economic Issues %D 2015 %T The Effect of Retirement Date Expectations on Pre-retirement Wealth Accumulation: The Role of Gender and Bargaining Power in Married US Households %A Romm, A. T. %K Adult children %K Consumption and Savings %K Employment and Labor Force %K Expectations %K Methodology %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %K Women and Minorities %X This paper used seven waves of data from the US Health and Retirement Study to investigate the impact of expectations regarding the timing of retirement on pre-retirement wealth accumulation of married households. More specifically, the effect of married individuals' subjective beliefs of working full time after age 62 on household wealth was analyzed. Individuals' perceptions of the usual retirement age on the job was used as an instrument for their subjective beliefs of working full time after age 62. On a whole, the point estimates suggested that the responsiveness of married mens' saving behavior to retirement dates expectations was larger than that of married women. In particular, wealth of married households where men had the bargaining power in terms of being sole earners, exhibited the largest decrease in response to increases in subjective probabilities of working past age 62. %B Journal of Family and Economic Issues %I 36 %V 36 %P 593-605 %G eng %N 4 %4 Retirement date/Subjective beliefs/Wealth/expectations/retirement planning/household wealth/labor Force Participation/Personality and Social Psychology/Economics of Gender/Non-labor Discrimination/Public Policy/Women/family structure/Personal finance %$ 999999 %R 10.1007/s10834-014-9413-4 %0 Report %D 2015 %T Elderly Poverty in the United States in the 21st Century: Exploring the Role of Assets in the Supplemental Poverty Measure %A Wimer, Christopher %A Manfield, Lucas %K Income %K Net Worth and Assets %X Official estimates of elderly poverty do not take into account either the medical needs of the elderly, which can be quite extensive, or the assets at their disposal, which may also be extensive. The new Supplemental Poverty Measure (SPM) explicitly takes into account medical needs but has been criticized for not concomitantly taking into account asset portfolios. In this paper we consider both jointly, using an approach adapted from a recent National Academy of Sciences report recommending methods for measuring poverty and medical risk while taking account of assets. We use longitudinal data from the Health and Retirement Study (HRS). %I Boston College %G eng %U http://crr.bc.edu/working-papers/elderly-poverty-in-the-united-states-in-the-21st-century-exploring-the-role-of-assets-in-the-supplemental-poverty-measure/ %4 Poverty/medical needs/assets/medical risk %$ 999999 %0 Thesis %D 2015 %T Essays in Household Savings and Portfolio Choice %A Dal Borgo, Mariela %K Net Worth and Asset %K Net Worth and Assets %K Risk Taking %K Social Security %K Women and Minorities %X The first part of this thesis presents a decomposition of household savings. One of the explanations for the wealth gap is that households with the same income level and demographic characteristics present differences in saving rates. This issue has been studied for African American versus Whites, but has not been directly addressed for Hispanics. Using pre-retirement data from the Health and Retirement Study, I compute saving rates as the ratio of wealth change to income over the years 1992-1998 and 1998-2004. In a regression framework I find that Mexican Americans, but not other Hispanics, have lower saving rates than Whites, even after controlling for income and socio-demographic factors. The inclusion of Social Security (S.S.) and pension wealth widens the gap further, which reflects the lack of pensions' coverage among Mexican Americans. In contrast, the difference between African Americans and Whites is only significant when retirement assets are not added to total wealth, consistent with the equalizing effect of S.S.. Then I conduct a regression decomposition for the mean gap in saving rates and find that: i) the component of the Mexican American-White differential not explained by observable characteristics becomes significant when S.S. and pensions are included; ii) with or without retirement assets the unexplained racial gap disappears; and iii) income and education are the main predictors of the savings gaps. The second and third parts investigate the effect of bankruptcy protection on households' portfolio choice. The debtor protection provided by the U.S. personal bankruptcy law reduces exposure to uninsurable risks: it allows defaulters to discharge unsecured debt and to protect a certain amount of home equity. A reduction in background risk - for example, resulting from labor or entrepreneurial income - can affect the demand for risky financial assets. Thus, the bankruptcy protection can affect ex ante households' willingness to tilt the financial portfolio towards those assets. On the one hand the implicit consumption insurance may lead to higher risk-taking by increasing the consumption floor if there is a negative wealth shock ("risk-taking channel"). On the other hand, more generous bankruptcy provisions will lead to a reduction in the demand for stock via: i) a higher probability of bankruptcy, since stocks are lost in bankruptcy because they are not protected ("protection channel"); or ii) worse credit market conditions -less access to credit at a higher price-, since higher bankruptcy protection implies a reduction of the collateral ("credit market channel"). In the context of a portfolio choice model, in the second chapter I illustrate how the bankruptcy protection can affect risk-taking through the "risk-taking channel" and the "protection channel". In the third part, I examine empirically the relationship between bankruptcy protection and stock market participation by exploiting the variation in that protection across states and over time. I find that doubling the amount of home equity that can be protected reduces stock ownership by 2 p.p. at intermediate protection levels ($22,000 to $90,000). This decline is restricted to high-asset and high-income households, which are more likely to participate in the stock market. Since poor rather than rich households are affected by worse credit market conditions when bankruptcy becomes more generous, the "credit market channel" is not a plausible mechanism. I do not find any effect of higher protection on the share of stocks in liquid assets, which suggests that the bankruptcy protection does not affect households' risk appetite. My findings are consistent with unprotected rather than risky assets becoming less attractive as the level of protection increases, as predicted by the "protection channel". %I University of Warwick %C Coventry, UK %V Ph. D. %G eng %9 Ph. D. %4 Portfolio Choice %! Essays in Household Savings and Portfolio Choice %0 Thesis %D 2015 %T Essays in industrial organization %A Bayot, Denrick Go %Y Hortacsu, Ali %K Consumption and Savings %K Employment and Labor Force %K Healthcare %K Methodology %K Net Worth and Assets %K Other %K Risk Taking %X Chapter 1 considers markets where there are gains to committing to a contract but the contract is not enforceable. Contracts in these markets typically contain some feature that locks the noncommittal agent, such as a penalty for defaulting on a contract. I argue that these lock-in mechanisms might lead to inefficient contract provisions when there is some uncertainty in the agent's valuation of the contract, and such uncertainty cannot be contracted. I then apply this argument when examining the extent to which life insurance contracts drafted today exhibit this form of ex-post inefficiency. There are a few reasons why one would suspect the existence of excessive insurance provisions in the life insurance industry. First, premiums in life insurance contracts are heavily front-loaded to subsidize subsequent premiums. The front-loading of premiums in these contracts and reduction of future premiums, as nicely pointed out by Hendel and Lizzeri (2003), allows firms to insure against rising premiums (insurance against reclassification risk) by reducing the policyholder's incentive to drop a contract and shop for a possibly less expensive policy. Indeed, I find that the level at which these contracts are front-loaded eliminates any future incentive for policyholders to repurchase a contract. I also provide evidence that a policyholder's preference for insuring against mortality risks changes stochastically over time. Despite heavy premium front-loading, almost 40% of policyholders allow their insurance to lapse within the first 10 years. Considering that premiums are lower than the cost of supplying mortality risk insurance and that preferences for such insurance changes over time, one would suspect excessive ex-post life insurance provisions. The core analysis of Chapter 1 discusses why the market for term life insurance contracts fail to fully protect policyholders from reclassification risk. Hendel and Lizzeri (2003) argue that such failure arises from the policyholder's limited-commitment and credit constraints. In particular, they surmise that a policyholder's credit constraint prevents the level of front-loading necessary to prevent all healthy policyholders from eventually walking out. The anticipated default of healthy policyholders then leads to a partial break-down in reclassification risk insurance. I investigate this premise and find that limited commitment alone fails to explain the break-down in full reclassification risk insurance observed in the life-insurance industry. I find that efforts to mitigate ex-post inefficient insurance provisions led to the breakdown of full reclassification risk insurance in this market. Chapter 2 is a joint work with Juliette Caminade and explains why prices of champagne fall during the holiday season. In this chapter, we document countercyclical prices in the sparkling wine market during the holiday season. While quantity demand doubles, prices uniformly decrease and decreases by 16% on average. We examine the role of changes in aggregate elasticity during high demand periods. Using Nielsen retail data, we find that price elasticity for sparkling wine increases by 50% during the holidays. We then use household-level data to document how the change in demand is driven by the entry of a large share of new consumers. These consumers are responsible for a quarter of sales during the holidays and are more price elastic. For instance, they spend less on other alcoholic beverages, and they are more likely to use coupons for their purchases or buy generic products. These suggestive facts are confirmed by the results of our household level demand estimation, where we find that changes to aggregate elasticity is driven by the entry of a more elastic segment. %I The University of Chicago %C Chicago %V 3712084 %P 92 %8 2015 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1707673975?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/Dissertations+%26+Theses+%40+CIC+Institutions&rft_val_fmt=info:of %9 Ph.D. %M 1707673975 %4 0501:Economics %! Essays in industrial organization %0 Thesis %D 2015 %T Essays on Health Economics %A Ippolito, Benedic N. %Y John Karl Scholz %K Employment and Labor Force %K Healthcare %K Income %K Insurance %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %X The first chapter, co-authored with Michael Batty, investigates how financial constraints influence hospital care. Specifically we study the impacts of recently enacted state "Fair Pricing" laws, which explicitly limit how much hospitals can collect from uninsured patients. Using the Nationwide Inpatient Sample, we find that the introduction of a fair pricing law leads to reductions in the amount of care delivered to uninsured patients, but find no evidence of deterioration of short-term quality of care. Overall, our results provide strong evidence that hospitals actively alter their behavior in response to financial incentives, and are consistent with the laws promoting a shift towards more efficient care delivery. In the second chapter I investigate how retirement incentives embedded in health insurance contracts influence labor market decisions of older workers. Employers typically offer one of two types of health plans: tied contracts (coverage ends at retirement) or retiree contracts (coverage continues in retirement). In comparison to a retiree plan, a tied contract provides an obvious incentive to delay retirement, but which workers stay? Particularly, what are the health characteristics of workers who respond to the incentives of the tied contract? I show that, contrary to suggestions in the literature, tied contracts produce advantageous selection. Additionally, I investigate the fact that tied contracts are consistently found to delay retirement even after age 65 - at which point workers are eligible for Medicare coverage. I show that this "excess retention" effect is entirely driven by workers with younger spouses who do not have their own insurance. The final chapter is joint work with Michael Batty and Joseph Levy, and examines how physician behavior responds to the introduction of a "panel-based" compensation structure - where a large portion of compensation is based on the number of patients a provider is responsible for, rather than the amount of work actually done. Taking advantage of a natural experiment at a large academic health system, we show that physician behavior is surprisingly unresponsive to changes in incentives - particularly for those who experienced a clear reduction in production incentives. %I The University of Wisconsin - Madison %C Madison, WI %V 3714612 %P 95 %8 2015 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1700219263?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/Dissertations+%26+Theses+%40+CIC+Institutions&rft_val_fmt=info:of %9 Ph.D. %M 1700219263 %4 0769:Health care management %! Essays on Health Economics %0 Thesis %D 2015 %T Essays on Health Insurance and Annuities %A Shepard, Mark %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X Insurance creates an important source of economic well-being by providing for beneficiaries in times of need. But because a variety of forces may inhibit the proper functioning of insurance markets, governments are deeply involved through regulation, subsidies, and direct provision of insurance. This dissertation studies insurance demand, supply, and the role of policy in two types of markets of direct interest to policymakers: health insurance and annuities. I highlight the importance of both traditional market failures (adverse selection and moral hazard) and less standard factors like limited competition (market power) and puzzlingly low insurance demand to influence insurance market outcomes. In the first chapter, I study how health insurers compete in individual insurance markets like those established in the Affordable Care Act. I focus on the role of an increasingly important benefit: plans' networks of covered medical providers. Using data from Massachusetts' pioneer insurance exchange, I show evidence of substantial adverse selection against plans covering the most expensive and prestigious academic hospitals. Individuals loyal to the prestigious hospitals both select plans covering them and are more likely to use these hospitals' high-price care. Standard risk adjustment does not capture their higher costs driven by preferences for using high-price providers. To study the welfare implications of network-based selection, I estimate a structural model of hospital and insurance markets and use the model to simulate insurer competition on premiums and hospital coverage in an insurance exchange. I find that with fixed hospital prices, adverse selection leads all plans to exclude the prestigious hospitals. Modified risk adjustment or subsidies can preserve coverage, benefitting those who value the hospitals most but raising costs enough to offset these gains. I conclude that adverse selection encourages plans to limit networks and star academic hospitals to lower prices, with the welfare implications depending on whether those high prices fund socially valuable services. Chapter 2 also studies health insurance exchanges and the competitive effect of a policy design choice: how the level of subsidies is determined. In the Affordable Care Act exchanges and other programs, subsidies depend on prices set by insurers – as prices rise, so do subsidies. I show that these "price-linked" subsidies incentivize higher prices, with a magnitude that depends on how much insurance demand rises when the price of uninsurance (the mandate penalty) increases. To estimate this effect, I use two natural experiments in the Massachusetts subsidized insurance exchange. In both cases, I find that a $1 increase in the relative monthly mandate penalty increases plan demand by about 1%. Using this estimate, my model implies a sizable distortion of $48 per month (about 12%). This distortion has implications for the tradeoffs between price-linked and exogenous subsidies in many public insurance programs. I discuss an alternate policy that would eliminate the distortion while maintaining many of the benefits of price-linked subsidies. Chapter 3 studies demand for annuities – insurance products that protect retirees against outliving their assets. Standard life cycle theory predicts that individuals facing uncertain mortality will annuitize all or most of their retirement wealth. Researchers seeking to explain why retirees rarely purchase annuities have focused on imperfections in commercial annuities – including actuarially unfair pricing, lack of bequest protection, and illiquidity in the case of risky events like medical shocks. I study the annuity choice implicit in the timing of Social Security claiming and show that none of these can explain why most retirees claim benefits as early as possible, effectively choosing the minimum annuity. Most early claimers in the Health and Retirement Study had sufficient liquidity to delay Social Security longer than they actually did and could have increased lifetime consumption by delaying. Because the marginal annuity obtained through delay is better than actuarially fair, standard bequest motives cannot explain the puzzle. Nor can the risk of out-of-pocket nursing home costs, since these are concentrated at older ages past the break-even point for delayed claiming. Social Security claiming patterns, therefore, add to the evidence that behavioral explanations may be needed to explain the annuity puzzle. %I Harvard University %C Cambridge, MA %G eng %4 early claiming %! Essays on Health Insurance and Annuities %0 Thesis %D 2015 %T Essays on the economics and econometrics of human capital %A Mosso, Stefano %Y Heckman, James J. %K Methodology %K Net Worth and Assets %K Other %X This thesis is composed by three distinct chapters. They are related by their common theme: the economic analysis of the process of human capital formation. The first chapter distills and extends the recent research on the economics of human development and social mobility. It critically analyzes the literature on the role of early life conditions in shaping multiple life skills with emphasis on the importance of critical and sensitive investments periods in influencing skill development. It develops economic models that rationalize the empirical evidence on treatment effects of social programs and on family influence. It investigates the empirical support of recent claims, made by part of the literature, on the relevance of credit constraints in limiting skill development. It shows how credit constraints are not a major force explaining differences in the amount of parental and self-investments in skills and how untargeted income transfer policies to poor families do not significantly boost child outcomes. The second chapter compares the performance of maximum likelihood and simulated methods of moments in estimating dynamic discrete choice models. It presents a structural model of education and shows how it can be used to estimate heterogeneous returns from schooling choices which account for their continuation values. Continuation values have a large impact on returns, but are ignored in the measures commonly used to assess the value of schooling choices. The estimates from the model are used to compute a synthetic dataset. This is used to assess the ability of maximum likelihood and simulated methods of moments to recover the model parameters. It finally proposes a Monte Carlo exercise to gain confidence on the performance of a simulated method of moments algorithm. The last chapter proposes a method to assess long run impacts on earnings of early interventions even in absence of long-term data collection on earnings histories for program participants. It combines the methodological approaches of the literature on program evaluation, data combination and forecasting to develop estimators of the average treatment effects. This exercise allows a more complete cost-benefit evaluation of social programs accounting for benefits over the whole life cycle. %I The University of Chicago %C Chicago %V 3712723 %P 161 %8 2015 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1705542399?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/Dissertations+%26+Theses+%40+CIC+Institutions&rft_val_fmt=info:of %9 Ph.D. %M 1705542399 %4 0501:Economics %! Essays on the economics and econometrics of human capital %0 Journal Article %J IZA Journal of Labor Policy %D 2015 %T The Impact of the Recession on the Wealth of Older Immigrant and Native Households in the United States %A Amuedo-Dorantes, Catalina %A Pozo, Susan %K Employment and Labor Force %K Housing %K Net Worth and Assets %K Pensions %K Public Policy %K Retirement Planning and Satisfaction %K Women and Minorities %X Using the 2006 and 2010 Health and Retirement Study, we explore how the recent recession impacted the wealth holding and retirement plans of older households in the United States. Of particular interest to us is whether the impact on household asset ownership, asset wealth and household retirement behavior varied with the nativity of the household and its standing in the wealth distribution prior to the onset of the recession. We find that the so-called Great Recession made a significant dent on the portfolios of older American households by eroding the value of specific assets to the point of delaying their planned retirement. Furthermore, its impacts were unevenly distributed across demographic and economic groups, with mixed and immigrant households in the middle and top wealth quartiles prior to the recession enduring significantly larger wealth losses than natives due, primarily, to their greater losses in primary housing ownership and primary housing values. %B IZA Journal of Labor Policy %I 4 %V 4 %G eng %4 Economics of the Handicapped/Minorities/Retirement Policy/public policy/Household assets/housing/assets/great Recession/Retirement planning/pensions/labor Force Participation %$ 999999 %R 10.1186/s40173-015-0033-x %0 Thesis %D 2015 %T Implications of Homeownership for Endogenous Risk Aversion, Asset Pricing and Portfolio Composition %A Liang, Xuan %Y Flavin, Marjorie %K Housing %K Methodology %K Net Worth and Assets %K Public Policy %K Risk Taking %X The dissertation studies the role of housing in asset pricing and household asset allocation. Housing is unique in the sense that it is both an asset and a consumption good. In addition, any adjustment in housing consumption will incur a non-convex adjustment cost. This makes housing adjustment infrequent. Due to these unique characteristics, the role of housing in a household portfolio is quite different from financial assets such as stocks and bonds. The first chapter, "The Housing CCAPM with Adjustment Costs and Heterogeneous Agents" examines how the inclusion of housing consumption in the utility function can increase the volatility and countercyclicality of the stochastic discount factor and thus help explain a higher level of equity premium despite only moderate curvature of the utility function. The keys to better performance of the model are (i) existence of the adjustment cost (ii) non-separability between housing goods and nondurable goods in the utility function and (iii) low substitutability between housing consumption and nondurable consumption. It is also shown that the housing CCAPM performs better than a standard CCAPM in explaining the variation of cross-sectional risk premia. Chapter 2, "Implications of the Housing Market for Endogenous Risk Aversion" studies household portfolio choice in a partial equilibrium model with housing consumption, adjustment costs, and varying housing prices. It is shown that household relative risk aversion is dependent on their house value to wealth ratio. Therefore, by changing the household's house value to wealth ratio, variation in house prices can affect household stock holdings through a change in household risk aversion. In addition, the model has two specific implications for households. The first is that volatile house price dynamics leads to more frequent moving. The second is that household moving leads to higher relative risk aversion. In general equilibrium, these effects would imply that volatile housing prices can lead to a higher moving frequency and thus result in a higher level of aggregate risk aversion, which would increase the price of risk in the risky asset markets. We provide empirical evidence that there is a high correlation between housing price volatility and the price of risk. Chapter 3, "Implications of the Housing Model for Moving Frequency, Relative Risk Aversion and the Portfolio Share of Risky Assets" tests the implications of the household portfolio choice model developed in Chapter 2 using household level data from the Panel Study of Income Dynamics and finds that the empirical evidence is consistent with the model. Firstly, we use cross-sectional variation in state level house prices and household moving to study the relationship between the volatility of house prices and moving frequency. Secondly, we use household moving and portfolio data to study the effect of moving on risk aversion. In addition, Chapter 3 also studies the effect of becoming unemployed on household moving by solving a model with housing consumption, adjustment costs, and a stochastic labor income process. The result suggests that the overall effect of unemployment is to reduce the frequency of moving. In addition, a sudden shift to an unemployed status can increase household risk aversion. Thus in general equilibrium, we would expect that a higher unemployment rate will increase economy wide risk aversion, which will in turn decrease the demand for stocks and increase the risk premium required. This provides a new channel (through the change in risk aversion) for the unemployment rate to affect asset prices. %I University of California, San Diego %C San Diego, CA %V 3709258 %P 113 %8 2015 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1699058643?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+Full+Text&rft_val_fmt=info:ofi/ %9 Ph.D. %M 1699058643 %4 0501:Economics %! Implications of Homeownership for Endogenous Risk Aversion, Asset Pricing and Portfolio Composition %0 Journal Article %J Journal of Health and Social Behavior %D 2015 %T In Sickness and in Health? Physical Illness as a Risk Factor for Marital Dissolution in Later Life %A Karraker, Amelia %A Kenzie Latham %K Adult children %K Health Conditions and Status %K Net Worth and Assets %X The health consequences of marital dissolution are well known, but little work has examined the impact of health on the risk of marital dissolution. In this study we use a sample of 2,701 marriages from the Health and Retirement Study (1992-2010) to examine the role of serious physical illness onset (i.e., cancer, heart problems, lung disease, and/or stroke) in subsequent marital dissolution due to either divorce or widowhood. We use a series of discrete-time event history models with competing risks to estimate the impact of husband's and wife's physical illness onset on risk of divorce and widowhood. We find that only wife's illness onset is associated with elevated risk of divorce, while either husband's or wife's illness onset is associated with elevated risk of widowhood. These findings suggest the importance of health as a determinant of marital dissolution in later life via both biological and gendered social pathways. %B Journal of Health and Social Behavior %I 56 %V 56 %P 59-73 %G eng %N 1 %4 marital Dissolution/health Shocks/physical illness onset/Divorce/Widowhood %$ 999999 %R 10.1177/0022146514568351 %0 Journal Article %J EBRI Notes %D 2015 %T A Look at the End-of-Life Financial Situation in America %A Sudipto Banerjee %K Housing %K Net Worth and Assets %K Social Security %X This paper takes a comprehensive look at the financial situation of older Americans at the end of their lives. In particular, it documents the percentage of households with a member who recently died with few or no assets. It also documents the income, debt, home-ownership rates, net home equity, and dependency on Social Security for households that experienced a recent death. Significant findings include that among those who died at ages 85 or above, 20.6 percent had no non-housing assets and 12.2 percent had no assets left. Among singles who died at or above age 85, 24.6 percent had no non-housing assets left and 16.7 percent had no assets left. Data show those who died at earlier ages were generally worse off financially: 29.8 percent of households that lost a member between ages 50 and 64 had no assets left. Households with at least one member who died earlier also had significantly lower income than households with all surviving members. The report shows that among singles who died at ages 85 or above, 9.1 percent had outstanding debt (other than mortgage debt) and the average debt amount for them was 6,368. The report also shows that the importance of Social Security to older households cannot be overstated. For recently deceased singles, it provided at least two-thirds of their household income. Couple households above 75 with deceased members received more than 60 percent of their household income from Social Security. The data for this study come from the University of Michigan s Health and Retirement Study (HRS), which is sponsored by the National Institute on Aging, and is the most comprehensive national survey of older Americans. %B EBRI Notes %I 36 %V 36 %P 2-10 %G eng %N 4 %4 Home equity/Home ownership/Household income/Social Security benefits/Wealth %$ 999999 %0 Journal Article %J Review of Economics of the Household %D 2015 %T Marital bargaining in the demand for life insurance: evidence from the Health and Retirement Study %A Edwin S. Wong %K End of life decisions %K Insurance %K Net Worth and Assets %K Other %X A vast literature explores life insurance from the perspective of a single individual. This paper considers an alternative approach by developing and testing a theoretical model for term life insurance demand by married households over age 50. Allowing for joint, cooperative decision making between spouses, empirical findings show that increasing the relative bargaining power of husbands results in reductions in the size of the insurance policies covering the lives of husbands in a manner consistent with theory. The intuition is that households reallocate resources to states of nature that husbands place greater weight by reducing the amount spent on purchasing insurance covering the lives of husbands. In contrast, marital bargaining power generally has a substantially smaller effect in the demand for life insurance covering the lives of wives. However, when bargaining power is shifted towards husbands, life insurance coverage increases among the subsample of wives who provide a large proportion of total household income and are more likely to require protection against lost future income in the event of death. %B Review of Economics of the Household %I 13 %V 13 %P 243-268 %G eng %N 2 %4 life Insurance/household income/decision Making/Bargaining %$ 999999 %0 Thesis %D 2015 %T Marital History and Retirement Security: An Empirical Analysis of the Work, Family, and Gender Relationship %A Palmer, Lauren A. Martin %K Adult children %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This dissertation investigates the relationship between marital history and individuals' retirement resources, namely Social Security, employer-sponsored pensions, and non-housing wealth. Prior research provides a foundation for understanding marriage's positive relationship to retirement security, and suggests that marriage is financially beneficial and can even lessen some external factors that would otherwise damage a family's financial situation. Yet changing demographics, with fewer people in first marriages and rising numbers of individuals experiencing divorce and choosing to remain unmarried, suggest our understanding of this relationship for today's retirees may be limited. The purpose of this research is to identify which aspects of complex marital histories are associated with individuals' retirement security, paying particular attention to gender differences. Using data from nine waves of the Health and Retirement Study (1992-2008), four facets of marital history are examined: marriage type, frequency, timing, and duration. Currently married and currently unmarried respondents are separated during the analyses in order to adequately capture the association between previous marital events and retirement resources. The results indicate that marital history is associated with Social Security, employer-sponsored pensions, and non-housing wealth differently, and that these relationships vary by gender and current marital status. The findings provide support for the argument that marital history, and in particular marital duration, has a strong relationship to retirement resources. Contrary to expectations, currently married women with longer marriages have less Social Security and pension income than married women who experienced shorter marriages. Marital history has no relationship to the retirement security of married men. For the unmarried groups, never married men have the lowest odds of receiving an employer-sponsored pension and have less non-housing wealth than both divorce and widowed men. Unmarried women's retirement security is associated with the type of disruption experienced; women with multiple past marriages have more resources if they are currently widowed but less if they are currently divorced. Further study is needed to understand how and why complex marital history factors have a relationship to retirement finances, and to expand our knowledge about certain understudied populations such as remarried women and never married men. %I University of Massachusetts %C Boston %G eng %4 retirement security %! Marital History and Retirement Security: An Empirical Analysis of the Work, Family, and Gender Relationship %0 Report %D 2015 %T Narrow Framing and Long-Term Care Insurance %A Gottlieb, Daniel %A Olivia S. Mitchell %K Employment and Labor Force %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Risk Taking %X 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. %I Cambridge, MA, National Bureau of Economic Research %G eng %4 narrow framing/long term care insurance/risk Aversion/adverse selection %$ 999999 %0 Journal Article %J Review of Economics of the Household %D 2015 %T Portfolio choice and risk attitudes: a household bargaining approach %A Tansel Yilmazer %A Lich, Stephen %K Adult children %K Net Worth and Assets %K Other %K Risk Taking %X The goal of this study is to understand how the households decide on portfolio asset allocation when the husband and wife have different risk preferences. Using data from the Health and Retirement Study for 1992 2006, we show that the share of risky assets in portfolios of two-person households increases with the risk tolerance of the spouse who has more bargaining power. The risk tolerance of the spouse who has less bargaining power does not seem to affect the share of household wealth allocated to risky assets. These results are consistent with a cooperative bargaining framework where the investment in risky assets depends on the bargaining power of the more risk tolerant spouse. %B Review of Economics of the Household %I 13 %V 13 %P 219-241 %G eng %U http://dx.doi.org/10.1007/s11150-013-9207-8 %4 Portfolio choice/Risky assets/Household bargaining/Risk tolerance/Bargaining power/Married couples %$ 999999 %R 10.1007/s11150-013-9207-8 %0 Book Section %B Challenges of Latino Aging in the Americas %D 2015 %T Racial and Ethnic Disparities in Willingness to Pay for Improved Health: Evidence from the Aging and Population %A Odufuwa, Olufolake O. %A Berrens, Robert P. %A Valdez, R. Burciaga %E William A. Vega %E Kyriakos S Markides %E Jacqueline L. Angel %E Torres-Gil, Fernando M. %K Health Conditions and Status %K Net Worth and Assets %K Women and Minorities %B Challenges of Latino Aging in the Americas %I Springer %C New York %P 333-354 %G eng %4 mortality risk reduction/mortality/health status/morbidity/Latinos/statistical life value %$ 999999 %! Racial and Ethnic Disparities in Willingness to Pay for Improved Health: Evidence from the Aging and Population %& 20 %0 Thesis %B School of Public Service Leadership %D 2015 %T Relationship of financial literacy to retirement preparedness among female baby-boomer cohorts %A Womack, Barbara Klein %Y Keefer, Autumn %K End of life decisions %K Health Conditions and Status %K Methodology %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %K Women and Minorities %X Studies have not examined the impact of components of financial literacy on retirement preparedness nor the relationship between financial literacy and decision-making among female baby-boomers. This study examined data from the 2010 wave of the Health and Retirement Study for females born between 1946 and 1959. This study defined financial literacy as including knowledge of investment strategies, the bond market, risk, and diversity. It defined retirement preparedness as the possession of specific financial assets. Financial decision-making was defined as the potential for mortgage default and carrying balances on credit cards. The study used a synthesis of rational choice and planned behavior theories. Correlation was used to describe the relationships between variables, and Fisher's transformation was used to determine significant differences between cohorts. Multiple linear regression was used to create predictive models for retirement planning, with the resultant finding that age was significant in predicting retirement preparedness ( p < .01). Older cohorts were more prepared, particularly in terms of owning IRA/Keogh plans. Understanding the effects of holding a variety of stocks and foreign stocks were most strongly related to retirement preparedness. There was a significant relationship between financial literacy and the potential for mortgage default ( p < .05) but not for carrying credit card balances. The regression produced a significant ( p < .05) predictive model for retirement preparedness, thought the relationship with financial literacy was slight. The research has implications in terms of housing, health, and municipal sustainability. Further research is necessary to define financial literacy, retirement preparedness, and their relationship. %B School of Public Service Leadership %I Capella University %V Ph.D. %P 115 %8 2015 %G eng %4 Social research %! Relationship of financial literacy to retirement preparedness among female baby-boomer cohorts %0 Journal Article %J The International Journal of Aging and Human Development %D 2015 %T Sequential Patterns of Health Conditions and Financial Outcomes in Late Life: Evidence From the Health and Retirement Study %A Hyungsoo Kim %A Shin, Serah %A Karen A. Zurlo %K Demographics %K Net Worth and Assets %K Public Policy %X The cost and prevalence of chronic health conditions increase in late life and can negatively impact accumulated wealth. Based on the financial challenges midaged and older adults face, we sought to understand the evolution of distinctive sequences of chronic health conditions and how these sequences affect retirement savings. We used 10 waves of the Health and Retirement Study and tracked the health states and changes in wealth of 5,540 individuals. We identified five typical sequences of chronic health conditions, which are defined as follows: Multimorbidity, Comorbidity, Mild Disease, Late Event, and No Disease. Wealth accumulation differed across the five sequences. Multimorbidity and Comorbidity were the most costly sequences. Individuals with these health patterns, respectively, had 91,205 and 95,140, less net worth than respondents identified with No Disease. Our findings suggest policy makers consider sequential disease patterns when planning for the health-care needs and expenditures of older Americans. %B The International Journal of Aging and Human Development %I 81 %V 81 %P 54-82 %G eng %U http://ahd.sagepub.com/content/81/1-2/54.abstract %N 1-2 %4 chronic health conditions/sequence/household wealth/older adults/Public Policy %$ 999999 %R 10.1177/0091415015614948 %0 Journal Article %J Journal of Economic Psychology %D 2015 %T The shadow of the past: Financial risk taking and negative life events %A Alessandro Bucciol %A Luca Zarri %K Health Conditions and Status %K Methodology %K Net Worth and Assets %K Risk Taking %X Based on data from the four 2004-2010 waves of the US Health and Retirement Study (HRS), we show that financial risk taking is significantly related to life-history negative events out of an individual's control. Using observed portfolio decisions to proxy for risk taking, we find correlation with two of such individual-specific events: having been victim of a physical attack and (especially) the loss of a child are associated with lower and less frequent investments in risky assets, with an intensity similar to that of the beginning, in 2008, of a collectively experienced event such as the recent financial crisis. We also find evidence that the correlation of risk taking with a child loss is long-lasting, as opposed to the correlation with a physical attack that disappears after few years. Our analysis is more in favor of a preference-based - rather than a belief-based - explanation of the observed change in risk taking. Overall our findings indicate that the past, especially through the loss of a child, casts a long shadow that extends over individuals' current decisions also within unrelated domains. 2015 Elsevier B.V. %B Journal of Economic Psychology %I 48 %V 48 %P 1-16 %G eng %U http://www.scopus.com/inward/record.url?eid=2-s2.0-84924229907andpartnerID=40andmd5=6152445130b56068d7f5620fd9709d48 %4 Behavioral finance/Financial asset ownership/Negative life events/Risk taking %$ 999999 %R 10.1016/j.joep.2015.02.006 %0 Journal Article %J Eastern Economic Journal %D 2015 %T Spousal Effects in Smoking Cessation: Matching, Learning, or Bargaining? %A McGeary, Kerry Anne %K Health Conditions and Status %K Methodology %K Net Worth and Assets %X Previous research studying the correlation in smoking behavior between spouses has discounted the role of bargaining or learning. Using the Health and Retirement Study, which contains information on smoking cessation and spouse s preferences, this paper presents an essential investigation of the impact of spousal bargaining or learning on the decision to cease smoking. We find that, regardless of gender, when one member of a couple ceases smoking this induces the other member to cease smoking through bargaining. Further, we find that women demonstrate either altruistic behavior toward a spouse who has suffered a health shock, or learning from their spouse s health shock. %B Eastern Economic Journal %I 41 %V 41 %P 40-50 %G eng %4 tobacco/smoking cessation/household decisions/health/fixed effects %$ 999999 %R 10.1057/eej.2013.34 %0 Thesis %D 2015 %T Three Essays on the Supply of Long-Term Care Services to the Elderly in the U.S %A Arora, Kanika %Y Douglas A. Wolf %K Adult children %K Health Conditions and Status %K Healthcare %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %K Public Policy %X Situated in the context of a rapidly aging population, this dissertation examines the implications of supplying long-term care (LTC) services to the elderly in the United States. The first two essays investigate private costs of LTC assistance borne by adult children of elderly parents. In contrast, the third essay focuses on the cost of publicly-provided, formal LTC services. The first essay analyzes whether adult children devote less time to exercise as time allocation in parental caregiving increases. The empirical model is a system of four correlated equations, where the dependent variables are hours spent caregiving, frequency of moderate and vigorous physical activity, and hours spent in paid work. I use pooled cross-sectional data from the Health and Retirement Study (HRS) for this analysis. Results from joint estimation of the four equations indicate limited evidence of a competition between time spent in caregiving and frequency of physical activity. Parental factors that increase allocation of care time to parents do not comprehensively induce reductions in the frequency of any type of physical activity, nor in hours of work, among either men or women. The second essay goes beyond time resources and examines whether dementia onset in parents leads to a reduction in adult children's household wealth. Towards this, I construct a longitudinal dataset from seven waves of HRS. Estimates from unconditional quantile regressions indicate that parental dementia substantially reduces household wealth of an unmarried adult child in the upper quantiles of the wealth change distribution in the first two years after parental diagnosis. These effects are more pronounced for unmarried adult children without siblings. Further, this response is observed to persist in the subsequent time period as well. An examination of mechanisms suggests that both, losses in labor income and nursing home expenditures, may play a role in leading to wealth declines. This paper makes two contributions: first, it focuses on a broader outcome of private cost, and second, unlike previous studies, it does not limit the analysis to adult children who are informal caregivers. The final essay examines the cost implications of publicly provided formal care services. Medicaid's Personal Care Services (PCS) State Plan benefit is a key mechanism through which states provide personal assistance services to eligible beneficiaries. But, it is widely claimed that states are reluctant to adopt the program over fears of runaway spending. Surprisingly, there has been very little empirical work on examining the effect of the PCS State Plan benefit on Medicaid expenditures. Using aggregate state-level data from 1975 through 2009, this study finds that PCS State Plan adoption had no overall effect on Medicaid expenditures, except briefly during the early-growth years in 1980s. Further, findings suggest that states make decisions to adopt the program based on financial experiences of other adopting states. This study provides evidence consistent with the interpretation that when faced with the dilemma of balancing increased access and uncontrolled expenditures, state officials adapt the design of an entitlement benefit in an effort to make it less expensive. In its entirety, the dissertation provides new thinking on two dominant themes in conventional long-term care research: "caregiver burden" and "woodwork effect". In particular, the results of the first and third essay question the presence of "caregiver burden" and "woodwork effect" respectively, while the third essay challenges the pervasiveness of "caregiver burden" among unmarried adult children. These findings, which in some aspect are unexpected in the context of existing literature, have important implications for policy intervention and the direction of future research efforts in this area. %I Syracuse University %C Syracuse, NY %V 3713670 %P 105 %8 2015 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1708672813?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+Full+Text&rft_val_fmt=info:ofi/ %9 Ph.D. %M 1708672813 %4 0630:Public policy %! Three Essays on the Supply of Long-Term Care Services to the Elderly in the U.S %0 Report %D 2015 %T The Transition from Defined Benefit to Defined Contribution Pensions: Does It Influence Elderly Poverty? %A Orlova, Natalia S. %A Matthew S. Rutledge %A April Yanyuan Wu %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X The transition from defined benefit (DB) to defined contribution (DC) pension plans has left workers forced to make choices that may decrease their financial resources in retirement: taking lump-sum distributions before retirement that divert funds that could support consumption in retirement, not annuitizing DC benefits, or choosing a single-life annuity over a joint-and-survivor option so that their surviving spouses are left susceptible to income loss. This study examines pension coverage, lump-sum distributions, annuitization, and annuity life options among Health and Retirement Study households observed at ages 65-69 and 75-79 and relates these pension provisions to poverty incidence and the risk of falling into poverty at older ages. The results indicate that households with pensions that are annuitized with the joint-and-survivor life option and that do not take lump-sum distributions before age 55 are best able to avoid income and asset poverty. The results emphasize the importance of making DC plans operate more like DB plans, because the opportunities for these poor financial choices are likely only to grow given the reliance on DC plans as the sole source of employer pension income for future cohorts of retirees. %I Boston College %G eng %4 Retirement planning/pension plans/Defined benefit plans/defined contribution pension plans/annuitization %$ 999999 %0 Journal Article %J Journals of Gerontology Series B-Psychological Sciences and Social Sciences %D 2015 %T The Vicious Cycle of Parental Caregiving and Financial Well-being: A Longitudinal Study of Women %A Lee, Yeonjung %A Tang, Fengyan %A Kim, Kevin H. %A Steven M. Albert %K Adult children %K Healthcare %K Net Worth and Assets %K Women and Minorities %X Objectives. This study examines the relationship between caring for older parents and the financial well-being of caregivers by investigating whether a reciprocal association, or vicious cycle, exists between female caregiver's lower household incomes and caring for elderly parents. Method. Data for women aged 51 or older with at least 1 living parent or parent-in-law were drawn from the Health and Retirement Survey 2006, 2008, and 2010 (N = 2,093). A cross-lagged panel design was applied with structural equation modeling. Results. We found support for the reciprocal relationship between parental caregiving and lower household income. Female caregivers were more likely than noncaregivers to be in lower household income at later observation points. Also, women with lower household income were more likely than women with higher household income to assume caregiving at later observation points. Discussion. This study suggests that there exists a vicious cycle of parental care and lower household income among women. A key concern for policy is female caregivers' financial status when care of older parents is assumed and care burden when women's financial status declines. %B Journals of Gerontology Series B-Psychological Sciences and Social Sciences %I 70 %V 70 %P 425-431 %G eng %N 3 %4 older parents/caregiver burden/household income/women/parental care/financial status %$ 999999 %R 10.1093/geronb/gbu001 %0 Report %D 2015 %T The Wealth of Wealthholders %A Ameriks, John %A Caplin, Andrew %A Lee, Minjoon %A Matthew D. Shapiro %A Tonetti, Christopher %K Adult children %K Consumption and Savings %K Employment and Labor Force %K Event History/Life Cycle %K Net Worth and Assets %K Public Policy %K Women and Minorities %X This paper introduces the Vanguard Research Initiative (VRI), a new panel survey of wealthholders designed to yield high-quality measurements of a large sample of older Americans who arrive at retirement with significant financial assets. The VRI links survey data with a variety of administrative data from Vanguard. The survey features an account-by-account approach to asset measurement and a real-time feedback and correction mechanism that are shown to be highly successful in eliciting accurate measures of wealth. Specifically, the VRI data reflect unbiased and precise estimates of wealth when compared to administrative account data. The VRI sample has characteristics similar to populations meeting analogous wealth and Internet access eligibility conditions in the Health and Retirement Study (HRS) and Survey of Consumer Finances (SCF). To illustrate the value of the VRI, the paper shows that the relationship between wealth and expected retirement date is very different in the VRI than in the HRS and SCF--mainly because those surveys have so few observations where wealth levels are high enough to finance substantial consumption during retirement. %I Cambridge, United States, NBER Working Paper No. 20972 %G eng %U http://search.proquest.com/docview/1687935318/1B5FA0446C27487FPQ/32 %4 Consumption/Saving/Wealth/Fiscal Policy/Fiscal Policy/Public Policy/transfers/Household economics/Intertemporal Household Choice/Life Cycle Models/Economics of the Elderly/Economics of the Handicapped/Non-labor Market Discrimination %$ 999999 %0 Journal Article %J Journal of Monetary Economics %D 2015 %T Wealth shocks, unemployment shocks and consumption in the wake of the Great Recession %A Christelis, Dimitris %A Dimitris Georgarakos %A Jappelli, Tullio %K Consumption and Savings %K Employment and Labor Force %K Net Worth and Assets %K Public Policy %X Data from the 2009 Internet Survey of the Health and Retirement Study show that many US households experienced large capital losses in housing and financial wealth, and that 5 of respondents lost their job during the Great Recession. For every loss of 10 in housing and financial wealth, the estimated drop in household expenditure was about 0.56 and 0.9 , respectively. Those who became unemployed reduced spending by 10 . In line with predictions of standard inter-temporal choice models, households who perceived the stock market shock to be permanent adjusted spending much more than those who perceived the shock to be temporary. %B Journal of Monetary Economics %I 72 %V 72 %P 21-41 %G eng %U http://www.sciencedirect.com/science/article/pii/S0304393215000069 %4 Wealth shocks/Unemployment/Consumption/Great Recession %$ 999999 %R 10.1016/j.jmoneco.2015.01.003 %0 Report %D 2015 %T What Determines End-of-Life Assets? A Retrospective View %A James M. Poterba %A Steven F Venti %A David A Wise %K Consumption and Savings %K Employment and Labor Force %K Net Worth and Assets %K Women and Minorities %X We consider assets when individuals were last observed prior to death in the Health and Retirement Study (HRS) and trace assets backwards to the age when these individuals were first observed. For most individuals, assets in the last year observed (LYO) were very similar to assets in the first year observed (FYO). In particular, most of those who were last observed with very low asset levels also had low assets when first observed. We also estimate the relationship between an individual's asset change between the first and last date of observation, that individual's education and health status when first observed, and that individual's within-sample changes in health and family composition. We obtain estimates for HRS respondents who were 51 to 61 in 1992 and for AHEAD respondents who were age 70 and over in 1993. %G eng %4 Consumption/Saving/Wealth/Economics of the Elderly/Economics of the Handicapped/Non-labor Market Discrimination %$ 999999 %0 Thesis %D 2015 %T What impacts life satisfaction of aging adults following stressful life events?: An examination of the buffering effect of personal resources %A Barragan, Cassandra %Y Faith P. Hopp %K Adult children %K Demographics %K Health Conditions and Status %K Healthcare %K Methodology %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %K Women and Minorities %X Purpose: Existing research has shown that elders experience changes in their life satisfaction following stressful life events. There is an abundance of literature supporting the predictive nature of not only stressful life events on life satisfaction, but social support, autonomy, and financial security. What the literature is lacking, is examination of the buffering effect of social support, autonomy, and financial security on the relationship between stressful life events and life satisfaction. This study hypothesizes that increases in social support, autonomy, and financial security will buffer the impact of SLEs for elders and thus, they will experience increases in their life satisfaction over time. It is also expected that social support and financial security will buffer differently among Black and White elders. Methods: The public use files of the Health and Retirement Study (HRS) between the years 2006 and 2012 are used to explore the interaction between social support, autonomy, and financial security with stressful life events and the impact on life satisfaction. Linear regression are conducted to explore each buffering impact on life satisfaction over time. Results: The research findings in this dissertation demonstrate that the changes in personal resources; social support, autonomy, and financial security; play an important role in changes in life satisfaction. Additionally, Black and White elders are impacted differently by changes in financial security. In general, the results from this study demonstrate that individuals who have declines in their personal resources following stressful life events also experience declines in their life satisfaction. %I Wayne State University %C Detroit %V 3700590 %P 158 %8 2015 %G English %9 Ph.D. %M 1680024446 %4 Aging %! What impacts life satisfaction of aging adults following stressful life events?: An examination of the buffering effect of personal resources %0 Journal Article %J Applied Economics Letters %D 2014 %T Can the government incentivize the purchase of private long-term care insurance? Evidence from the Partnership for Long-Term Care %A Nadia Greenhalgh-Stanley %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Risk Taking %X Using data from the Health and Retirement Study, I show that state adoption of Partnerships for Long-Term Care incentivized the purchase of private long-term care insurance, particularly for households displaying the greatest risk aversion and long-term financial planning horizons. %B Applied Economics Letters %I 21 %V 21 %P 541-544 %G eng %N 8 %4 Partnership for Long-Term Care/long-term care insurance/risk aversion/financial planning horizon %$ 999999 %0 Journal Article %J Biodemography and Social Biology %D 2014 %T Characterizing the Genetic Influences on Risk Aversion %A Harrati, Amal %K Genetics %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Risk Taking %X Risk aversion has long been cited as an important factor in retirement decisions, investment behavior, and health. Some of the heterogeneity in individual risk tolerance is well understood, reflecting age gradients, wealth gradients, and similar effects, but much remains unexplained. This study explores genetic contributions to heterogeneity in risk aversion among older Americans. Using over 2 million genetic markers per individual from the U.S. Health and Retirement Study, I report results from a genome-wide association study (GWAS) on risk preferences using a sample of 10,455 adults. None of the single-nucleotide polymorphisms (SNPs) are found to be statistically significant determinants of risk preferences at levels stricter than 5 x 10(-8). These results suggest that risk aversion is a complex trait that is highly polygenic. The analysis leads to upper bounds on the number of genetic effects that could exceed certain thresholds of significance and still remain undetected at the current sample size. The findings suggest that the known heritability in risk aversion is likely to be driven by large numbers of genetic variants, each with a small effect size. %B Biodemography and Social Biology %I 60 %V 60 %P 185-198 %G eng %N 2 %4 risk Aversion/retirement planning/investments/risk tolerance/genetics/genetics/Heritability %$ 999999 %R 10.1080/19485565.2014.951986 %0 Report %D 2014 %T Childhood Experience of Father's Job Loss and Stock Market Participation %A Lehtoranta, Antti %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X Using data from the Panel Study of Income Dynamics (PSID), I document that childhood experience of father's job loss decreases the propensity to own stocks as an adult. If this experience takes place at the age of 5 10 years, the probability of owning stocks decreases by 2.9 percentage points in a sample with mean stock market participation rate of 17 . This finding is robust to alternative definitions of age ranges and controlling for random unobserved effects. I also find an effect of similar magnitude in the Health and Retirement Study (HRS) data. %I Helsinki, Bank of Finland %G eng %4 stock market participation/personal experience/job loss %$ 999999 %0 Journal Article %J Quality of Life Research %D 2014 %T Determinants of socioeconomic inequalities in subjective well-being in later life: a cross-country comparison in England and the USA %A Jivraj, S. %A James Nazroo %K Cross-National %K Expectations %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X Purpose To explore country-specific influences on the determinants of two forms of subjective well-being (life satisfaction and quality of life) among older adults in England and the USA. Methods Harmonised data from two nationally representative panel studies of individuals aged 50 and over, the English Longitudinal Study of Ageing (ELSA) and the Health and Retirement Study (HRS), are used. Linear regression models are fitted separately for life satisfaction and quality of life scales using cross-sectional samples in 2004. The ELSA sample was 6,733, and the HRS sample was 2,300. Standardised coefficients are reported to determine the country-specific importance of explanatory variables, and predicted values are shown to highlight the relative importance of statistically significant country-level interaction effects. Results Having a disability, been diagnosed with a chronic conditions or having low household wealth are strongly associated with poorer life satisfaction and quality of life. These statistical effects are consistent in England and the USA. The association of years spent in education, however, varied between the two countries: educational inequalities have a greater adverse effect on subjective well-being in the USA compared with England. Conclusion Interventions are required to counterbalance health and socioeconomic inequalities that restrict sections of the population from enjoying satisfying and meaningful lives in older age. The differential association between education and well-being in England and the USA suggests that the provision of welfare benefits and state-funded public services in England may go some way to protect against the subsequent adverse effect of lower socioeconomic status on subjective well-being. %B Quality of Life Research %I 23 %V 23 %P 2545-2558 %G eng %N 9 %4 Cross-country comparison/Inequalities/Life satisfaction/Life satisfaction/Older age/Quality of life/Subjective well-being/ELSA_/cross-national comparison/household wealth/chronic conditions %$ 999999 %R 10.1007/s11136-014-0694-8 %0 Report %D 2014 %T Do Homeowners Mark to Market? A Comparison of Self-reported and Estimated Market Home Values During the Housing Boom and Bust %A Sewin Chan %A Sastrup, Samuel R. %A Ellen, Ingrid Gould %K Demographics %K Housing %K Net Worth and Assets %K Public Policy %X This paper examines homeowners self-reported values in the American Housing Survey and the Health and Retirement Study from the start of the recent housing price run-ups through recent price declines. We compare zip code level market-based estimates of housing prices to those derived from homeowners self-reported values. We show that there are systematic differences which vary with market conditions and the amount of equity owners hold in their homes. When prices have fallen, homeowners systematically state that their homes are worth more than market estimates suggest, and homeowners with little or no equity in their homes state values above the market estimates to a greater degree. Over time, homeowners appear to adjust their assessments to be more in line with past market trends, but only slowly. Our results suggest that underwater borrowers are likely to understate their losses and either may not be aware that their mortgages are underwater or underestimate the degree to which they are. %I New York, NYU Wagner School %G eng %U https://ideas.repec.org/a/bla/reesec/v44y2016i3p627-657.html %4 housing values/great Recession/Mortgage debt/Asset accumulation/Regional variations %$ 999999 %0 Journal Article %J American Journal of Geriatric Psychiatry %D 2014 %T Does the Widowhood Effect Precede Spousal Bereavement? Results from a Nationally Representative Sample of Older Adults %A Anusha M Vable %A S. V. Subramanian %A Pamela M. Rist %A M. Maria Glymour %K Adult children %K Health Conditions and Status %K Net Worth and Assets %X Objective: Increased mortality risk following spousal bereavement (often called the widowhood effect ) is well documented, but little prior research has evaluated health deteriorations preceding spousal loss. Design: Data are from the Health and Retirement Study, a nationally representative sample of Americans over 50 years old. Method: Individuals who were married in 2004 were considered for inclusion. Outcome data from 2006 on mobility (walking, climbing stairs), number of depressive symptoms, and instrumental activities of daily living (IADLs) were used. Exposure was characterized based on marital status at the time of outcome measurement: recent widows (N = 396) were bereaved between 2004 and 2006, before outcomes were assessed; near widows (N = 380) were bereaved between 2006 and 2008, after outcomes were assessed; married individuals (N = 7,330) remained married from 2004 to 2010, the follow-up period for this analysis. Linear regression models predicting standardized mobility, depressive symptoms, and IADLs, were adjusted for age, race, gender, birthplace, socio-economic status, and health at baseline. Results: Compared to married individuals, recent widows had worse depressive symptoms ( = 0.71, 95 confidence interval (CI): 0.57, 0.85 ). Near widows had worse depressive symptoms ( = 0.21, 95 CI: 0.08, 0.34 ), mobility ( = 0.14, 95 CI: 0.01, 0.26 ), and word recall ( = -0.13, 95 CI: -0.23, -0.02 ) compared to married individuals. Conclusions: Health declines before spousal death suggests some portion of the widowhood effect may be attributable to experiences that precede widowhood and interventions prior to bereavement might help preserve the health of the surviving spouse. 2014 American Association for Geriatric Psychiatry. %B American Journal of Geriatric Psychiatry %G eng %U http://www.scopus.com/inward/record.url?eid=2-s2.0-84902947790andpartnerID=40andmd5=a8046d229a07ff2a9286365ad66a8086 %4 cognitive functioning/depression/spousal bereavement/spousal loss/Widowhood/mortality risk/mortality risk %$ 999999 %R 10.1016/j.jagp.2014.05.004 %0 Thesis %D 2014 %T The economic security of an aging minority population: A profile of Latino baby boomers to inform future retirees %A Zachary Gassoumis %Y Kathleen H. Wilber %K Demographics %K Income %K Methodology %K Net Worth and Assets %K Women and Minorities %X The United States is facing dramatic demographic changes due to the aging of the Baby Boom Generation and increasing diversity, including rapid growth of the Latino population. Questions have been raised regarding the economic security of the aging baby boomers' generational cohort once they retire, which are of particular relevance to minority and Latino members of the cohort. Latinos tend to have lower levels of financial security than their white, non-Latino counterparts, but there is little research that examines individuals who fall into the intersection of these two groups: the Latino baby boomers. Because Latino boomers are a largely hidden population, their economic status and prospects are difficult to estimate. The first empirical chapter (Chapter 2) looks at the characteristics of the Baby Boomer population living in the 50 U.S. states and the District of Columbia, broken down by Latino ethnicity and citizenship status. Drawing from several U.S. Census Bureau data sources, it revealed three key findings: 1) there were 80 million baby boomers in the U.S. in 2000--more than previously reported--of which 8.0 million (10%) were Latinos; 2) U.S.-born Latino boomers were more similar to non-Latino boomers in terms of demographic characteristics, whereas foreign-born citizens and non-citizens scored less well on key demographic indicators; and 3) compared to non-Latino baby boomers, U.S.-born Latino baby boomers had somewhat less favorable economic characteristics. The second empirical chapter identifies the magnitude of racial/ethnic structural disadvantage for income and wealth in the years preceding retirement for the Baby Boom Generation, then compares their structural disadvantage with that of members of the Silent Generation cohort when they were the same age. After adjusting for sociodemographic variables (age, gender, citizenship status, education, marital status, and labor force participation), the structural effects of race/ethnicity on income--using the American Community Survey--and wealth--using the Health and Retirement Study--were considerably reduced, confirming two of the chapter's four hypotheses; however, the expected reduction in structural effects from the Silent Generation to the Baby Boom Generation was seen for wealth but not for income, confirming only one of the remaining two hypotheses. This reduction of structural disparities in wealth from the Silent Generation to the Baby Boom Generation follows the expectation that these disparities would be reduced over time, which signals good news for the younger members of the Baby Boom Generation, Generation X, and future generational cohorts. But large gaps still exist between racial/ethnic groups, even after sociodemographic adjustment; future reduction in those structural inequalities can help decrease those gaps, an especially important consideration for low-income racial/ethnic minority groups. The third empirical chapter takes an initial step toward disaggregating by age the effect of naturalization on income growth. Using linear growth curve modeling on data from the Survey of Income and Program Participation's 2004 panel, it attempts to replicate past findings across the entire lifespan, but fails to detect an effect of naturalization on income growth; only non-citizens had a significantly higher level of income growth during the study period than U.S.-born citizens. In subsetting the analysis for older and younger working-age groups, an effect of naturalization was not detected for either group, and the positive effect for non-citizens was seen only for the younger age group. The predictor variables on the whole had minimal relationships with slope in the model, with less than 1% of variance explained in each model. Although a stronger effect of the predictor variables, including an effect of naturalization, may have appeared were more years of data available, it was not detected over the 4-year study period. Two unexpected findings were: 1) individuals in the younger sample who had naturalized before the study had higher intercepts than U.S.-born citizens but no such difference emerged in the older sample; and 2) in a bivariate context, those who naturalized during the study represented a socioeconomic midpoint of sorts--on racial/ethnic composition, education, and income--naturalized prior to the study. In sum, these chapters shed light on the Baby Boom cohort's characteristics and dynamics in the period leading up to their retirement age. This dissertation provides insights into the characteristics, demographic history, and socioeconomic patterns of the upcoming cohort of retirees. Implications of these findings have the potential to inform and to modify practice and policy for the next cohort: Generation X. The findings underscore the importance of reducing disparities in education and, to a degree, citizenship as a mechanism for countering the persistent effects of structural inequality on income. These insights have implications for both theory and policy and lay a foundation for a wide range of future research, which is discussed in the final chapter. %I University of Southern California %C Los Angeles %V 3628171 %P 124 %8 2014 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1560683648?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt: %9 Ph.D. %M 1560683648 %4 ethnicity %$ 999999 %! The economic security of an aging minority population: A profile of Latino baby boomers to inform future retirees %0 Book %D 2014 %T Economics of the Family %A Browning, Martin %A Chiappori, Pierre-Andr %A Weiss, Yoram %K Adult children %K Demographics %K Net Worth and Assets %X The family is a complex decision unit in which partners with potentially different objectives make consumption, work, and fertility decisions. Couples marry and divorce partly based on their ability to coordinate these activities, which in turn depends on how well they are matched. This book provides a comprehensive, modern, and self-contained account of the research in the growing area of family economics. The first half of the book develops several alternative models of family decision making. Particular attention is paid to the collective model and its testable implications. The second half discusses household formation and dissolution and who marries whom. Matching models with and without frictions are analyzed and the important role of within-family transfers is explained. The implications for marriage, divorce, and fertility are discussed. The book is intended for graduate students in economics and for researchers in other fields interested in the economic approach to the family. %I Cambridge University Press %C New York %G eng %U http://www.amazon.com/Economics-Cambridge-Surveys-Economic-Literature/dp/0521795397 %4 families/Family economics/household finance/marriage/divorce/Fertility %$ 999999 %0 Journal Article %J Journal of Pharmaceutical Health Services Research %D 2014 %T Effects of cost-related medication nonadherence on financial health and retirement decisions among adults in late midlife %A Gail A Jensen %A Yong Li %K Employment and Labor Force %K Health Conditions and Status %K Healthcare %K Methodology %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X Objectives Suboptimal adherence to prescribed medications due to cost is known to adversely affect physical health. In this study, we examine whether cost-related nonadherence (CRN) also affects financial health , e.g. an individual's personal finances or the timing of their retirement. Methods We examine this issue for 2927 adults in late midlife with chronic medical conditions who participated in the Health and Retirement Study and who reported regularly taking medication(s) for their condition over the period 1994 to 2004. We hypothesize CRN may indirectly influence financial health by contributing to the occurrence of negative health shocks. We estimate two sets of models, one to quantify the effects of CRN on the occurrence of adverse health events, and another to quantify the effects of adverse health events on personal finances in 2004 and the timing of retirement. We then derive estimates of the indirect effects of CRN on financial health and on retirement decisions. Key findings Among adults in late midlife, CRN contributes significantly to reduced earnings and premature retirements. These effects happen because CRN raises the risk that serious health shocks occur over time, and such adverse events subsequently limit an individual's ability to continue working and accumulating wealth. Conclusions CRN can threaten more than just personal health. In late midlife, CRN can threaten an individual's ability to continue working and saving towards retirement. %B Journal of Pharmaceutical Health Services Research %I 5 %V 5 %P 205-213 %G eng %U http://dx.doi.org/10.1111/jphs.12076 %N 4 %4 chronic care/financial health/cost-related nonadherence/long-run outcomes/medications/retirement planning/spillover effects/labor Force Participation %$ 999999 %R 10.1111/jphs.12076 %0 Thesis %D 2014 %T End-of-life care planning and its implementation %A Inoue, Megumi %Y Inoue, Megumi %K End of life decisions %K Expectations %K Healthcare %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X End-of-life care planning is an opportunity for people to express how they want to spend the final stage of their lives by directing what type of medical treatment they wish or do not wish to receive. The completion of such planning is a way to exercise their autonomy, which is one of the fundamental ethical principles in medicine in the United States. Many older adults in the U.S., however, do not have such a plan or even discuss the topic with anyone. In order to understand the circumstances in which end-of-life planning is enacted, this study investigated two important research questions: (1) What are the sociodemographic and psychosocial factors that enhance or impede the completion of end-of-life planning? (2) How consistent is the content of a living will with the person's actual dying experience? These research questions were developed and examined as an application of expectancy theory, which explains the concepts of motivation and action. A series of logistic regression analyses were conducted. This study analyzed data from the Health and Retirement Study (HRS), which is a nationally representative sample of Americans over the age of 50. The analytic subsample included those who died between 2000 and 2010 ( N = 6,668). The study found that persons who were older, who identified themselves as White, who had higher levels of income and education, and who were widowed or separated were more likely to be motivated to complete end-of-life planning. A higher level of sense of mastery was specifically relevant to documentation of living wills. On the other hand, a lower level of religiosity was specifically associated with having a durable power of attorney for health care. In addition, there was a clear connection between a request for palliative care and less troubling pain. Implications include conducting a community- or workplace-based public educational campaign, incorporating a culturally tailored approach for racial/ethnic minorities (e.g. faith-based interventions), using advance directives written in easy to understand language (e.g. Five Wishes), and funding Medicare provision for end-of-life care consultations between doctors and patients during annual physical exams. %I Boston College %C Boston %V 3629596 %P 136 %8 2014 %G English %U http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1562496003?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt: %9 Ph.D. %M 1562496003 %4 public policy %$ 999999 %! End-of-life care planning and its implementation %0 Thesis %D 2014 %T Essays in applied economics %A Sacks, Daniel W. %Y Doraszelski, Uli Seim Katja %K Health Conditions and Status %K Healthcare %K Income %K Net Worth and Assets %K Public Policy %K Social Security %X Essay 1 studies physician agency problems, which arise whenever physicians fail to maximize their patients' preferences, given available information. These agency problems are well documented, but the magnitude of their welfare consequences for patients---the losses from suboptimal treatment choice induced by agency---are unclear. I infer patient drug preference from their compliance decisions. I begin by showing that initial prescriptions respond to physician financial incentives to control costs and to pharmaceutical detailing, but compliance does not, pointing to agency problems. I then develop and estimate a model of physician-patient interactions where physician write initial prescriptions, but patients choose whether to comply. Fully eliminating agency problems increases compliance by 6.5 percentage points, and raises patient welfare by 22\% of drug spending. Contracts that better align doctor and patient preferences can improve patient welfare, but attain only half the gains from eliminating agency completely. Although physician agency problems reduce patient welfare, eliminating them is thus likely difficult. Essay 2, co-authored with Alexander M. Gelber and Damon Jones, studies frictions in adjusting earnings to changes in the Social Security Annual Earnings Test (AET) using a panel of Social Security Administration microdata on one percent of the U.S. population from 1961 to 2006. Individuals continue to "bunch" at the convex kink the AET creates even when they are no longer subject to the AET, consistent with the existence of earnings adjustment frictions in the U.S. We develop a novel estimation framework and estimate in a baseline case that the earnings elasticity with respect to the implicit net-of-tax share is 0.23, and the fixed cost of adjustment is $152.08. Essay 3 studies the impact of health expenditure risk on annuitization. Theoretical research suggests that such risk can have an ambiguous influence on the annuitization decisions of the elderly. I provide empirical evidence on this linkage, by estimating the impact of supplemental Medicare insurance (Medigap) coverage on the annuity demand of older Americans. Medigap coverage has a strong impact on annuitization: the extensive margin elasticity is 0.39, the overall elasticity of private annuity income with respect to Medigap coverage is 0.56. These results are robust to controls for health, wealth, and preferences, as well as other robustness tests. They suggest that medical expenditure risk has a large impact on underannuitization. %I University of Pennsylvania %C Philadelphia, PA %V 3622123 %P 244 %8 2014 %G English %9 Ph.D. %M 1545895881 %4 Annuitization %$ 999999 %! Essays in applied economics %0 Thesis %D 2014 %T Essays in Urban and Labor Economics %A Ringo, Daniel %Y Gregorio Kinsler Jo Caetano %K Consumption and Savings %K Demographics %K Employment and Labor Force %K Event History/Life Cycle %K Housing %K Methodology %K Net Worth and Assets %X This dissertation contributes to two literatures: Urban Economics and Labor Economics. In the first chapter I estimate the effect of home ownership on individual workers' unemployment and wage growth, as well as other labor market outcomes. Because of higher moving costs, home owners will be less willing than renters to relocate for work and could therefore face longer unemployment spells. To elaborate on this hypothesis, credited to Oswald (1996), I build a simple search model and obtain a set of labor market predictions to test. The current microeconomic literature has reached mixed results regarding home ownership's impact, with most studies concluding that home ownership reduces unemployment. I show that the instruments used are likely to be invalid because of, among other reasons, Tiebout (1956) type sorting into housing markets. I use an instrumental variable free of the endogeneity present in other work: the county level home ownership rate when and where the worker grew up. This IV affects workers' preferences for housing but not, conditional on my covariates, their labor market ability. My results indicate that home ownership is a significant hindrance to mobility, and homeowners suffer longer unemployment spells and slower wage growth because of it. In the second chapter I use a dynamic model of neighborhood choice to estimate household preferences over the demographic characteristics of a neighborhood. I focus on the racial mix, average income and housing price level of a neighborhood, and whether households prefer neighbors that are similar to themselves. Identification of these preferences is complicated by the social aspect of neighborhood amenities. A household's valuation of a particular choice (neighborhood) is a function of the choices other households in the market have made and will make in the future. I show that demographic characteristics of a neighborhood are therefore endogenous to neighborhood quality. Standard estimates of preferences over neighbors may be biased by the presence of such unobservable local amenities. I develop a framework to correct this problem based on a careful delineation of the information households could have access to before and after they make their decisions. The model I build has the advantage over the literature of being able to produce self-consistent predictions about demographic changes. I deal with the low frequency of observations in my data set, the decennial census, by simulating local housing markets between data collection periods. After controlling for type-specific preferences for the physical amenities of neighborhoods, I find a universal preference for higher income neighbors. In contrast to much of the literature, my results suggest white households have no aversion to minority neighbors. In the third chapter I estimate the effect of parental credit scores on the child's probability of attending and completing college. Parents in the US are increasingly supplementing the student loans available to their children with unsecured debt in their own name. This is the first paper on this topic to make use of direct observations of credit scores, rather than rely on proxies such as wealth shocks. I find that good parental credit significantly improves the child's probability of attending college, with a smaller (although still significant) effect on the probability of completing a four-year degree. I provide evidence that the estimated relationship is causal and not biased by, for example, unobserved ability. Additionally, I show that credit scores may affect attendance through channels other than access to the student loan market. I hypothesize households substitute the potential to borrow for precautionary savings. %I University of Rochester %C Rochester, NY %V 3621255 %P 107 %8 2014 %G English %9 Ph.D. %M 1541549139 %4 intergenerational transfer %$ 999999 %! Essays in Urban and Labor Economics %0 Report %D 2014 %T Financial Literacy Among American Indians and Alaska Natives %A Murphy, John L. %A Gourd, Alicia %A Begay, Faith %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Women and Minorities %X Many Americans lack important financial skills and knowledge of critical concepts that can help ensure sound retirement planning and future economic security. Prior research has suggested that low levels of financial literacy are particularly acute among certain groups such as women, blacks, and persons with lower levels of educational attainment (Dunaway-Knight and others 2012; Hung, Parker, and Yoong 2009; Huston 2010; Lusardi 2008; A. Murphy 2005). This study adds to previous work on financial literacy among minority groups by examining the American Indian and Alaska Native (AIAN) population. Prior research on AIANs has often used convenience samples of university students and has been limited by the lack of nationally representative samples (for example, Anderson and others (2010); Chen and Volpe (2002); Mandell (2009); and Mandell and Klein (2007)). In this note, we use a nationally representative sample from the Health and Retirement Study (HRS) to analyze how AIAN respondents scored on the 2008 HRS financial literacy module compared with white respondents (reference group) and other minority groups. The HRS is one of the foremost sources of information on the population aged 50 or older. We use an 18-item financial sophistication and investment decision-making (FSIDM) questionnaire.1 Each correct answer receives one point; thus, the scale ranges from 0 to 18, with higher values representing more financial sophistication. The FSIDM questionnaire has been widely used in other studies to investigate financial literacy (for example, Agarwal and others (2009); Lusardi (2008); Lusardi and Mitchell (2007, 2008, 2011); and Lusardi, Mitchell, and Curto (2009)). Researchers have primarily used the FSIDM questionnaire to examine overall knowledge of financial literacy across broad swaths of the older U.S. population by sex, age, income, and race. However, racial differences in the aforementioned studies have been primarily limited to those between blacks and whites. Our analysis finds that the mean number of questions that AIAN respondents correctly answered was significantly lower than the comparable figures for white, black, and Asian respondents. For each of the 18 questions in the module, we find that there are specific financial literacy topics in which the knowledge gap between AIANs and other race/ethnic groups was particularly large. However, a limited sample size constrains this analysis, and additional data and research are needed to fully address financial literacy within the AIAN population. %I Social Security Administration, Office of Retirement and Disability Policy, Office of Research, Evaluation, and Statistics %G eng %U http://www.ssa.gov/policy/docs/rsnotes/rsn2014-04.html %4 Native Americans/financial literacy/retirement planning/economic security/American Indians/Alaska Natives %$ 999999 %0 Journal Article %J Journal of Pension Economics and Finance %D 2014 %T Financial literacy and financial sophistication in the older population %A Annamaria Lusardi %A Olivia S. Mitchell %A Vilsa Curto %K Demographics %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X 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. %B Journal of Pension Economics and Finance %I 13 %V 13 %P 347-366 %G eng %N 4 %4 Financial knowledge/framing/gender differences/retirement security/retirement security %$ 999999 %R 10.1017/S1474747214000031 %0 Journal Article %J Journal of Urban Economics %D 2014 %T Financial literacy and mortgage equity withdrawals %A John V. Duca %A Kumar, Anil %K Consumption and Savings %K Net Worth and Assets %K Public Policy %X Mortgage equity withdrawals (MEW) are correlated with covariates consistent with a permanent income framework augmented for credit-constraints. We assess linkages between MEW and financial literacy/education using the Health and Retirement Study (HRS) and Panel Study of Income Dynamics (PSID). We find that the financially literate are 3-5 percentage points less likely to withdraw housing equity via non-home equity loan mortgages using the HRS, while college graduates are 5 percentage points less likely than those without a high school degree in the PSID. Among those withdrawing housing equity in the PSID, college graduates extract significantly less equity and are less likely to have high levels of housing leverage after doing so. 2013 Elsevier Inc. %B Journal of Urban Economics %I 80 %V 80 %P 62-75 %G eng %U http://www.scopus.com/inward/record.url?eid=2-s2.0-84887604806andpartnerID=40andmd5=03717bfccf399874e90d42373861c89b %4 Consumption/Credit constraints/Financial literacy/Mortgage equity withdrawals %$ 999999 %0 Report %D 2014 %T The Great Recession, Decline and Rebound in Household Wealth for the Near Retirement Population %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %X This paper uses data from the Health and Retirement Study to examine the effects of the Great Recession on the wealth held by the near retirement age population from 2006 to 2012. For the Early Boomer cohort (ages 51 to 56 in 2004), real wealth in 2012 remained 3.6 percent below its 2006 value. This is a modest decline considering the fall in asset values during the Great Recession. Much of the decline in wealth over the 2006 to 2010 period was cushioned by wealth originating from Social Security and defined benefit pensions. For the most part, these are stable sums that ensured a major fraction of total wealth did not decline as a result of the recession. The rebound in asset values observed between 2010 and 2012 mitigated, but did not erase, the asset losses experienced in the first years of the Great Recession. Effects of the Great Recession varied with the household's initial wealth. Those who were in the highest wealth deciles typically had a larger share of their assets subject to the influence of declining markets, and were hurt most severely. Unlike those falling in lower wealth deciles, they have yet to regain all the wealth they lost during the recession. Recovering losses in assets is only part of the story. The assets held by members of the cohort nearing retirement at the onset of the recession would normally have grown over ensuing years. Members of older HRS cohorts accumulated assets rapidly in the years just before retirement. Those on the cusp of retiring at the onset of the recession would be much better off had they had enjoyed similar growth in assets as experienced by members of older cohorts. The bottom line is that the losses in assets imposed by the Great Recession were relatively modest. The recovery has helped. But much of the remaining penalty due to the Great Recession is in the failure of assets to grow beyond their initial levels. %I Cambridge, MA, National Bureau of Economic Research %G eng %4 great Recession/Asset accumulation/household wealth/asset values/loss recovery %$ 999999 %0 Journal Article %J EBRI Notes %D 2014 %T How Does Household Expenditure Change With Age for Older Americans? %A Sudipto Banerjee %K Consumption and Savings %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Retirement saving involves a lot of unknowns, the most important being not knowing how much money will be needed in retirement. Although it is impossible to predict the retirement expenses of any particular household, the average amounts spent by current retirees can serve as important benchmarks for individual savers as well as for industry experts and policymakers. This paper examines the expenditure pattern of the older segment of the U.S. population. The majority of the households studied here have either reached retirement age or are on the cusp of retirement. The data come from the Health and Retirement Study (HRS) and the Consumption and Activities Mail Survey (CAMS), which is a supplement of the HRS. CAMS contains detailed spending information on 26 nondurable and six durable categories, and it follows the same group of people over time. Using this information coupled with the income information available in the HRS, this study summarizes the consumption behavior of the American elderly. The primary goal is to examine how overall spending and spending in different categories change with age. Home and home-related expenses is the largest spending category for every age group. Health expenses increase steadily with age. In 2011, households with at least one member between ages 50 and 64 spent 8 percent of their total budget on health items, compared with 19 percent for those age 85 or over. Health-related expenses occupy the second-largest share of total expenditure for those ages 75 or older. The two components of household expenditures that show a declining pattern across age groups are transportation expenses and entertainment expenses. Food and clothing expenses (as a share of total expenditure) remain more or less flat across the different age groups. There is a large increase in spending at the 95th percentile for those ages 90 or older, which can be attributed to very high health care expenses. %B EBRI Notes %I 35 %V 35 %P 2-11 %G eng %N 9 %4 Consumption/Health care costs/Household expenditure/Household income/Retirement planning/Spending %$ 999999 %0 Journal Article %J Journal of Pension Economics and Finance %D 2014 %T How is economic hardship avoided by those retiring before the Social Security entitlement age? %A Kevin Milligan %K Health Conditions and Status %K Income %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %K Social Security %X Governments around the world are reacting to extended lifespans and troubled pension finances by increasing the age of retirement benefit entitlement. This paper studies those who retire before the age of full pension entitlement in the USA using data drawn from the Health and Retirement Study. The major finding is that four out of five people who have zero earnings at pre-entitlement ages are able to find a way to lift their incomes over the poverty line. For men, pension and annuity income are important while for women, spousal income helps most to get them over the line. %B Journal of Pension Economics and Finance %I 13 %V 13 %P 420-438 %G eng %N 4 %4 pensions/poverty/retirement/Social Security/old age pensions/pension income/annuity income/household income %$ 999999 %R 10.1017/S1474747214000171 %0 Thesis %D 2014 %T Human, Social and Cultural Capital Predictors of Early Baby Boomer Productivity in Mid- to Late Life: An Examination of Formal Volunteering Behavior %A Nowell, William Benjamin %Y Burnette, Jacqueline D. %K Adult children %K Demographics %K Healthcare %K Net Worth and Assets %K Other %K Public Policy %X Productive activity supports successful aging by helping to maintain older adults' cognitive and physical functioning and active engagement in life. This study examines the human, social and cultural resources that contribute to productive activity, specifically formal volunteering, among Early Baby Boomers (EBB) during the transition from mid-life to late life. Four time points across 6 years from a sample of 2,684 EBBs aged 51 and older from the Health and Retirement Study (2004-2010) were analyzed using logistic regression and generalized estimating equations. Baseline and longitudinal human, social and cultural capital factors and demographic variables functioned as predictors of formal volunteer engagement and its intensity. High levels of cultural capital, defined as religiosity, significantly increased the likelihood of both formal volunteer engagement and high intensity volunteering. Greater human capital and some forms of social capital also boosted the probability of volunteer engagement, but higher levels of one component of social capital (paid employment) significantly reduced the likelihood of high intensity volunteering. Volunteer engagement and intensity were stable during the observed period, in spite of the Great Recession during the latter waves of data. Gender appeared to have no effect on the likelihood of volunteer engagement or intensity. The distribution of human, social and cultural resources was associated with differences in mid- to late life productivity among EBBs, and productive activities of formal volunteering and paid employment appear to compete for their time. Exploring the unique contributions of aspects of education and religion to volunteerism in future research may lead to more inclusive public policy and programs that facilitate the participation of individuals from a wider array of backgrounds. Such efforts can increase opportunities for formal volunteering among persons transitioning from mid- to late life. %I Columbia University %C New York %V 3617751 %P 178 %8 2014 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1527486354?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1527486354 %4 Social work %$ 999999 %! Human, Social and Cultural Capital Predictors of Early Baby Boomer Productivity in Mid- to Late Life: An Examination of Formal Volunteering Behavior %0 Journal Article %J Social Security Bulletin %D 2014 %T Immigrants and retirement resources %A P. Sevak %A Lucie Schmidt %K Demographics %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Social Security %X The extensive literature documenting differences in wages between immigrant and native-born workers suggests that immigrants may enter retirement at a significant financial disadvantage relative to workers born in the United States. However, little work has examined differences in retirement resources and retirement security between immigrants and natives. In this article, we use data from the Health and Retirement Study linked with restricted data from the Social Security Administration to compare retirement resources of immigrants and natives. Our results suggest that while immigrants have lower levels of Social Security benefits than natives, when holding demographic characteristics constant, immigrants have higher levels of net worth. The estimated immigrant differentials vary a great deal by number of years in the United States, with the most recent immigrants being the least prepared for retirement. %B Social Security Bulletin %I 74 %V 74 %P 27-45 %G eng %U http://www.scopus.com/inward/record.url?eid=2-s2.0-84896524474andpartnerID=40andmd5=976830d676d69e4ce7cb6b6bbe280982 %N 1 %4 social security/claiming behavior/claiming behavior/Immigrant/retirement resources/retirement planning/net worth %$ 999999 %0 Report %D 2014 %T The Impact of Health Insurance on Stockholding: A Regression Discontinuity Approach %A Christelis, Dimitris %A Dimitris Georgarakos %A Anna Sanz-de-Galdeano %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %K Risk Taking %X Using data from the US Health and Retirement Study, we study the causal effect of increased health insurance coverage through Medicare and the associated reduction in health-related background risk on financial risk-taking. Given the onset of Medicare at age 65, we identify our effect of interest using a regression discontinuity approach. We find that getting Medicare coverage induces stockholding for those with at least some college education, but not for their less-educated counterparts. Hence, our results indicate that a reduction in background risk induces financial risk-taking in individuals for whom informational and pecuniary stock market participation costs are relatively low. Tables, Figures, Appendixes, References. %I Bonn, Germany, Institute for the Study of Labor %G eng %U http://ftp.iza.org/dp8635.pdf %4 Medicare/Health insurance/risk taking/stock market/assets/methodology %$ 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 Journal of Family and Economic Issues %D 2014 %T Older Adults Receipt of Financial Help: Does Personality Matter? %A Gillen, Martie %A Hyungsoo Kim %K Health Conditions and Status %K Net Worth and Assets %X This study examined the role of personality traits in the receipt of financial help at older ages using the 2006 and 2008 waves of Health and Retirement Study data. An investigation of (1) how the five domains of personality traits (openness to experience, conscientiousness, extraversion, agreeableness, and neuroticism) are associated with the receipt of financial help among older adults and (2) the relationship between personality traits and the source of financial help received was examined. Three sets of probit analyses were conducted. The results indicated that personality can predict financial help and the source of financial help. Specifically, older adults who exhibited relatively higher levels of neuroticism and agreeableness were more likely to receive financial help, whereas those who exhibited relatively higher levels of conscientiousness were less likely to receive financial help regardless of the source. Furthermore, older adults who had relatively higher levels of neuroticism were more likely to help themselves with individual sources such as credit cards whereas agreeable older adults were more likely to receive financial help from family members. These findings have implications for financial counseling, planning and education professionals, public assistance program directors, and policy makers. Understanding the effect of personality on financial decision-making can help with financial planning throughout life and inform outreach efforts for those in need of financial help. %B Journal of Family and Economic Issues %I 35 %V 35 %P 178-189 %G eng %U http://dx.doi.org/10.1007/s10834-013-9365-0 %N 2 %4 Personality traits/Financial help/financial counseling/Big five %$ 999999 %R 10.1007/s10834-013-9365-0 %0 Journal Article %J Review of Finance %D 2014 %T Optimal Portfolio Choice with Annuities and Life Insurance for Retired Couples %A Hubener, Andreas %A Maurer, Raimond %A Rogalla, Ralph %K Adult children %K Insurance %K Net Worth and Assets %X Using a portfolio choice model, we derive the optimal demand for stocks, bonds, annuities, and term life insurance for a retired couple with uncertainty in both lifetimes. We show that the optimal portfolio is heavily weighted with joint annuities and that life insurance is purchased mainly to protect a surviving spouse from loss of annuitized income rather than for bequest. Consistent with these predictions, empirical analyses on Health and Retirement Study data indicate that life insurance holdings are related to the degree of asymmetry in the couple's annuitized income distribution. %B Review of Finance %I 18 %V 18 %P 147-188 %G eng %N 1 %4 Married couples/Life insurance/Portfolio choice/Annuities %$ 999999 %R 10.1093/rof/rfs046 %0 Thesis %D 2014 %T Patterns of dissaving among U.S. elders %A Gray, Deborah %Y Bruce, Ellen A. %K Adult children %K Consumption and Savings %K Event History/Life Cycle %K Healthcare %K Net Worth and Assets %K Public Policy %X This paper examined patterns of decumulation and the role that health events and marital disruption play in forming those patterns. Study data were drawn from six biennial waves of the HRS (1998 - 2008), and merged RAND HRS data files for the period 1998-2008. The a priori expectation was that there will be variation in drawdown strategies households employ. Findings suggest that patterns of dissaving are heterogeneous. The five most prevalent patterns were discussed. Households predominantly transitioned between oversaving and overspending. Households are expected to have a goal of on target spending therefore the observed cycle's dissaving will influence the next cycle's draw down rate in an attempt to maintain a sustainable drawdown rate. Markov model results suggest that households do recalibrate their depletion rate as a function of their last depletion rate. This study hypothesized that the onset of a health condition or a spouse's admission to a nursing home would be associated with an excessive decumulation of assets. These hypotheses were unsupported by the research. Marital transitions as predictors of decumulation were only partially borne out by the results. Divorce was also expected to increase the likelihood of overspender however this relationship was not significant. Loss of spouse was associated with an increased likelihood of verspending. One of the major contributions of this study is the identification of patterns of dissaving in retirement. Various life course, demographic and decumulation factor variables were determinants of these patterns. Overall results suggest that elders have a difficult time managing to an on target drawdown. This study concludes with a national decumulation policy directive outline. %I University of Massachusetts Boston %C Boston %V 3622193 %P 169 %8 2014 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1547725290?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1547725290 %4 Public policy %$ 999999 %! Patterns of dissaving among U.S. elders %0 Journal Article %J The Journals of Gerontology Series B: Psychological Sciences and Social Sciences %D 2014 %T Patterns of Widowhood Mortality %A Allison R Sullivan %A Andrew Fenelon %K Adult children %K Health Conditions and Status %K Methodology %K Net Worth and Assets %X Objectives. Becoming widowed is a known risk factor for mortality. This article examines the magnitude of, explanations for, and variation in the association between widowhood and mortality. Previous research on widowhood mortality has revealed variation by socioeconomic status (SES), in that SES is not protective in widowhood, and by gender, such that men s mortality increases more than women s mortality after the death of spouse.Method. Using data from the Health and Retirement Study, we estimated Cox proportional hazard models to estimate the association between widowhood and mortality.Results. Becoming widowed is associated with a 48 increase in risk of mortality. Approximately one third of the increase can be attributed to selection, in that those who become widows are socioeconomically disadvantaged. In contrast to previous studies, SES is protective for widows. Widowhood mortality risk increases for men if their wives deaths were unexpected rather than expected; for women, the extent to which their husbands death was expected matters less.Discussion. Widowhood s harmful association with mortality show how strongly social support and individual s health and mortality are related. These findings support the larger literature on the importance of social support for health and longevity. %B The Journals of Gerontology Series B: Psychological Sciences and Social Sciences %I 69B %V 69B %P 53-62 %G eng %U http://psychsocgerontology.oxfordjournals.org/content/69B/1/53.abstract %N 1 %4 Hazard Model/Marital Status/Mortality/Social Support/Widowhood %$ 999999 %R 10.1093/geronb/gbt079 %0 Thesis %D 2014 %T Public policy and postsecondary education %A Dubnicki, Alissa L. %Y Gary London Andrew Engelhardt %K Demographics %K Education %K Event History/Life Cycle %K Net Worth and Assets %K Pensions %K Public Policy %X Chapter 1 . This paper presents estimates of the impact of educational saving incentives on college saving decisions from the Michigan SEED Program, a field experiment that targeted low-income families with young children. The treatment group was offered initial deposits of as much as $1,000 in the child's name into the state-sponsored 529 college savings plan when the child was 4 years old. Additional deposits by the treatment group were matched dollar for dollar. After four years, or when the children were 8 years old, 529 plan ownership was 59 percentage points higher for treatment- relative to control-group families. In addition, 22% of treatment-group families contributed their own funds, and, among these, the average family contribution was $440 during that period. For every dollar saved in a 529 plan, total college saving increased 25-45 cents, indicating 55-75% crowd-out. Chapter 2 . This paper presents estimates of the impact of student eligibility for federal financial aid on total student debt. I exploit a natural experiment created by the 1992 Amendment to the Higher Education Act of 1965, which removed assets from the calculation of federal aid eligibility for families with earned income of less than $50,000. Overall, my estimates suggest that expansions in federal student aid eligibility have large, significant effects on total undergraduate debt accumulation. Each dollar of federal aid eligibility increases student debt by about 40 cents. This relationship is due to new, rather than existing, borrowers. A $1,000 increase in eligibility is predicted to increase the ratio of debt to total price of attendance by 4 percentage points. I find that the effect of federal aid eligibility on debt is significantly higher for those with more exposure to higher education. Based on my central estimates, the expansion in aid eligibility caused by the 1992 Amendment is responsible for about one-third of the growth in total student debt from 1989-90 to 1993-94. Chapter 3 . The experimental and quasi-experimental literature finds few positive effects of financial education on financial behavior and wealth. I posit that the lack of measurable effects may be a result of the underlying relationship between financial literacy and asset accumulation. Theoretical literature suggests that financial education and traditional education are complements in the wealth production function, so the effect of financial education is conditional on years of schooling. To empirically test this theoretical hypothesis, I provide the first experimental evidence on the elasticity of substitution between traditional schooling and financial education in terms of wealth production in this paper. I am able to credibly identify this elasticity with data from the Learn$ave IDA program, a randomized control trial that exogenously shifted the costs of these inputs to wealth production. Using a dual translog cost function specification, I estimate an iterated 3SLS strategy to measure individual elasticities of substitution between wealth production inputs. The mean value of all of the individual estimated elasticities of substitution is greater than zero, indicating that, on average, the inputs are substitutes. %I Syracuse University %C Syracuse, NY %V 3620452 %P 142 %8 2014 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1538122964?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1538122964 %4 Public Policy %$ 999999 %! Public policy and postsecondary education %0 Book Section %B International Handbook on Ageing and Public Policy %D 2014 %T Retirement Planning and Financial Literacy %A Annamaria Lusardi %E Harper, Sarah %E Hamblin, Kate %K Net Worth and Assets %K Retirement Planning and Satisfaction %B International Handbook on Ageing and Public Policy %I Edward Elgar Publishing %C Northhampton, MA %P 474-490 %G eng %4 retirement planning/financial literacy %$ 999999 %! Retirement Planning and Financial Literacy %0 Thesis %D 2014 %T Social regulatory processes in adulthood : responding to change and variability in proximal and distal social forces %A Shannon T. Mejia %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %X Adult development and social experiences are intertwined, which has implications for social policy, health, and well-being across the lifespan. This dissertation explores the benefit and risk that close social partners bring to adults' lives, and the efficacy and consequences of engaging social resources to maintain well-being in the face of variability and change in their proximal and distal social environments. The first study, using a life course perspective and a macro analytic lens, traced experiences of financial loss in middle adulthood during the 2008 recession. Using the 2006 and 2010 waves of the Health and Retirement Study (n = 1,881; age range = 51 - 60 years), this study used conditional change models and path analysis to examine the extent to which increasing household complexity, giving help, receiving help, and relationship quality promoted or hindered the capacity to maintain a sense of control in the face of financial loss. Experiencing financial loss was directly associated with decreased control and giving help, and increased household complexity and receiving help. Experiences of financial loss indirectly decreased control through increased household complexity and decreased giving help. Although the experience of financial loss was distributed across differences in income and education, social resources patterned the engagement of interpersonal resources, which translated to engagement patterns that could compromise the sense of control. However, change in relationship quality, which did not systematically differ across experiences of financial loss, created pathways to support or hinder maintaining a sense of control while engaging interpersonal resources. The second study, informed by lifespan developmental theory and developmental systems theory, applied a micro analytic lens to closely examine the within-person processes that connect daily interactions within the social convoy to emotional well-being in older adulthood. Using data from the Personal Understanding of Life and Social Experiences Project, this study linked older adults' (N = 99; age mean = 63.29, SD = 7.93) satisfaction with their five closest social partners to daily experiences of positive and negative affect across 100 days. Multivariate multilevel models suggest that older adults' daily affect is more sensitive to the quality of daily interactions with closest compared to other social partners. The relative strength of positive and negative affect sensitivity also varied within levels of closeness. Negative affect was relatively more sensitive to interactions with the closest social partner, and positive affect was relatively more sensitive to interactions with other close social partners. This study also found emotional sensitivity to vary within individuals. Satisfying contact with other social partners dampened emotional sensitivity to the closest social partner on that day. These patterns differed across overall levels of contact satisfaction. Those with lower overall satisfaction had higher emotional sensitivity, and were less able to regulate the sensitivity of positive affect. Together, the findings from these studies suggest that: (a) how individuals engage their interpersonal resources in response to loss can facilitate or hinder the maintenance of control and well-being; (b) the strategies that individuals engage vary by the presence or absence of socioeconomic and socioemotional resources; and (c) social partners contribute to both emotional reaction and recovery, but this sensitivity can be up and down regulated by reaching out to other close social partners. Relationships with others therefore contribute to well-being by supporting (or hindering) the regulation of self, actions, and emotions. Regulation through close interpersonal ties illustrates a process that links developmental and life course trajectories. %I Oregon State University %C Corvallis, OR %G eng %4 household finance %$ 999999 %! Social regulatory processes in adulthood : responding to change and variability in proximal and distal social forces %0 Thesis %D 2014 %T Three essays on personality and net worth %A Nabeshima, George %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This dissertation consists of three studies exploring the relationship between personality and wealth related variables. The psychological type theory was used as the theoretical framework for the first two studies, while the doctrine of interactionism was used in the third study. All three studies utilized data from the 2010 panel of the Health and Retirement Study (HRS). The first study examined the relationship between personality traits and net worth. Linear regression results identified the extroversion and conscientiousness traits as being positively associated with net worth. Furthermore, the agreeableness trait was negatively associated with net worth. The second study explored the relationship between personality preference and stock ownership. This study's logistic regression results identified the preference for high openness and high neuroticism as significant and positively associated with stock ownership. A high agreeableness preference was significant and negatively associated with stock ownership. The focus of the third study examined how net worth and income mediated the association between personality and life satisfaction. Regression results from this study identified net worth as being a significant mediating variable in the association between the conscientiousness trait and life satisfaction levels. However, income, in addition to net worth, was also a significant mediating variable when the extroversion and neuroticism traits were used to represent personality trait variables. Results from the three studies identified significant associations between personality traits and components of net worth. These findings contribute to the financial planning field by providing useful information in regards to how mental preferences expressed outwardly though personality traits are related to wealth related variables and life satisfaction. Financial planning practitioners can apply these findings to formulate strategies to assist people grow their wealth levels. %I Kansas State University %C Manhattan, KS %G eng %4 household wealth %$ 999999 %! Three essays on personality and net worth %0 Report %D 2014 %T Wealth Shocks and Health Outcomes: Evidence from Stock Market Fluctuations %A Schwandt, Hannes %K Health Conditions and Status %K Net Worth and Assets %X Do wealth shocks affect the health of the elderly in developed countries? The economic literature is skeptical about such effects which have so far only been found for poor retirees in poor countries. In this paper I show that wealth shocks also matter for the health of wealthy retirees in the US. I exploit the booms and busts in the US stock market as a natural experiment that generated considerable gains and losses in the wealth of stock-holding retirees. Using data from the Health and Retirement Study I construct wealth shocks as the interaction of stock holdings with stock market changes. These constructed wealth shocks are highly predictive of changes in reported wealth. And they strongly affect health outcomes. A 10 wealth shock leads to an improvement of 2-3 of a standard deviation in physical health, mental health and survival rates. Effects are heterogeneous across physical health conditions, with most pronounced effects for the incidence of high blood pressure, smaller effects for heart problems and no effects for arthritis, diabetes, lung diseases and cancer. The comparison with the cross-sectional relationship of wealth and health suggests that the estimated effects of wealth shocks are larger than the long-run wealth elasticity of health. Tables, Figures, Appendixes, References. %I Bonn, Germany, Institute for the Study of Labor %G eng %U http://ftp.iza.org/dp8298.pdf %4 Stock market/retiree health/wealth shocks/health status/asset accumulation %$ 999999 %0 Report %D 2014 %T Wealth Shocks, Unemployment Shocks and Consumption in the Wake of the Great Recession %A Christelis, Dimitris %A Dimitris Georgarakos %A Jappelli, Tullio %K Consumption and Savings %K Employment and Labor Force %K Net Worth and Assets %K Public Policy %X We use data from the 2009 Internet Survey of the Health and Retirement Study to examine the consumption impact of wealth shocks and unemployment during the Great Recession in the US. We find that many households experienced large capital losses in housing and in their financial portfolios, and that a non-trivial fraction of respondents have lost their job. As a consequence of these shocks, many households reduced substantially their expenditures. We estimate that the marginal propensities to consume with respect to housing and financial wealth are 1 and 3.3 percentage points, respectively. In addition, those who became unemployed reduced spending by 10 percent. We also distinguish the effect of perceived transitory and permanent wealth shocks, splitting the sample between households who think that the stock market is likely to recover in a year s time, and those who do not. In line with the predictions of standard models of intertemporal choice, we find that the latter group adjusted much more than the former its spending in response to financial wealth shocks. %I London, Centre for Economic Policy Research %G eng %4 consumption/great recession/unemployment/wealth shocks/household wealth/stock Market %$ 999999 %0 Journal Article %J The journals of gerontology. Series B, Psychological sciences and social sciences %D 2014 %T Widowhood and depression: new light on gender differences, selection, and psychological adjustment %A Sasson, Isaac %A Debra Umberson %K Demographics %K Health Conditions and Status %K Net Worth and Assets %K Other %X Objectives. To document short- and long-term trajectories of depressive symptoms following widowhood and to test whether these trajectories vary by gender and anticipatory spousal loss. Method. Eight waves of prospective panel data from the Health and Retirement Study, over a 14-year period, are used to evaluate gender differences in depressive symptoms following widowhood in late midlife. Short-term trajectories are modeled using a linear regression of change in Center for Epidemiologic Studies Depression (CES-D) score on duration of widowhood. Long-term trajectories are modeled using a mixed-effects hierarchical linear model of CES-D scores over time. We find no gender differences in bereavement effects on depressive symptoms in either short or long term, net of widowhood duration. When spousal death is anticipated, both men and women return to their prewidowhood levels of depressive symptoms within 24 months of becoming widowed. Across marital groups, the continuously married are better off compared with the widowed even prior to spousal loss, whereas early, long-term widowhood is associated with worse outcomes compared with late widowhood. Discussion. Although men and women do not differ in trajectories of depressive symptoms following widowhood, given similar circumstances, women are distinctly disadvantaged in that they are more likely to become widowed and under less favorable conditions. %B The journals of gerontology. Series B, Psychological sciences and social sciences %I 69 %V 69 %P 135 %G eng %N 1 %4 Depression/Widowhood/Gender differences/Adjustment/Bereavement %$ 999999 %0 Journal Article %J Ewha Journal of Social Sciences %D 2014 %T Zeta Estimates of Wealth Volatility and Financial Planning Horizon %A Grable, John %A Chatterjee, Swarn %K Methodology %K Net Worth and Assets %X The intention of this study was to document how closely households follow normative descriptions of financial behavior in relation to their financial planning horizon. Modern Portfolio Theory predicts that households, in general, exhibit risk aversion. Aversion to wealth volatility should correspondingly be highest among those households with the shortest planning horizons. This study estimated percentage changes in wealth and wealth volatility over time categorized by financial planning horizon using data from the 2002 through 2010 waves of Health and Retirement Study. Modigliani ratios were computed for the entire population and by planning horizon. Zeta estimates were made by calculating the difference between the Modigliani ratios for each planning horizon and the ratio for the short-term horizon. Contrary to the conceptualized relationship between planning horizon and financial wealth volatility, results from this study show that respondents with the shortest financial planning horizons experienced lower risk-adjusted returns and greater wealth volatility. The findings of this study underscore an unmet and perhaps unrealized need for professionally provided financial planning. %B Ewha Journal of Social Sciences %I 30 %V 30 %P 5-24 %G eng %N 2 %4 household wealth/Financial planning/Zeta estimages/Modigliani Ratio/Sharpe Ratio/Wealth/methodology %$ 999999 %0 Report %D 2013 %T Are Gender Differences Emerging in the Retirement Patterns of the Early Boomers? %A Kevin E. Cahill %A Michael D. Giandrea %A Joseph F. Quinn %K Demographics %K Employment and Labor Force %K Healthcare %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Women and Minorities %X Controlling for career employment later in life, the retirement patterns of men and women in America have resembled one another for much of the past two decades. Is this relationship coming to an end? Recent research suggests that the retirement patterns of the Early Boomers those born between 1948 and 1953 have diverged from those of earlier cohorts. Gender differences appear to be emerging as well in the way that career men and women exit the labor force, after nearly two decades of similarities. This paper explores these gender differences in detail to help determine whether we are witnessing a break in trend or merely a short-term occurrence. We use data on three cohorts of older Americans from the nationally-representative, longitudinal Health and Retirement Study (HRS) that began in 1992. We explore by gender the types of job transitions that occur later in life and explore, in particular, the role of four potentially relevant determinants: the presence of dependent children; a parent in need of caregiving assistance; occupational status on the career job; and self-employment status. We find that, among career men and women, child and parental caregiving are not significant drivers of the retirement transitions of the Early Boomers, all else equal. Gender differences that may exist with respect to these characteristics are therefore unlikely to lead to persistent gender differences in retirement patterns. In contrast, self employment continues to be a statistically significant determinant of bridge job transitions and phased retirement. This finding, combined with the fact that men are much more likely than women to be self employed later in life, could lead to some differences by gender going forward, though the impact is likely to be limited given that the large majority of older workers are in wage-and-salary employment. Older Americans both men and women are responding to their economic environment by working later in life and exiting the labor force gradually. While some determinants of these decisions likely impact men and women differently, gender differences with respect to the retirement patterns of the Early Boomers appear to be the result of broader macroeconomic forces. The evidence to date suggests that gender differences may dissipate as the recovery ensues. %I Washington, DC, Bureau of Labor Statistics %G eng %U http://www.bls.gov/osmr/pdf/ec130090.pdf %4 Economics of Aging/Partial Retirement/Gradual Retirement/retirement planning/early boomers/labor Force Participation/gender differences/caregiver Status/WOMEN/working spouses %$ 69300 %0 Journal Article %J Health Economics %D 2013 %T Borrowing to cope with adverse health events: liquidity constraints, insurance coverage, and unsecured debt %A Patryk D. Babiarz %A Widdows, Richard %A Tansel Yilmazer %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Public Policy %X This article uses data from the Health and Retirement Study for 1998-2010 to investigate whether households respond to the financial stress caused by health problems by increasing their unsecured debt. Results show both the probability of having unsecured debt and the amount of debt increase after an adverse health event among households with low financial assets, who are uninsured, or who have less generous health insurance. The effect of health problems on borrowing is caused by both medical expenditures and disruptions to the income stream. Unsecured debt seems to remain on some households' balance sheets for an extended period. %B Health Economics %I 22 %V 22 %P 1177-98 %G eng %N 10 %4 financial security/health Insurance/Financial risk taking/unsecured debt %$ 69120 %R 10.1002/hec.2877 %0 Thesis %D 2013 %T A Bumpy Road: Asset Accumulation, Unexpected Life Course Events, and Later Life Economic Security %A Sullivan, Laura Anne %Y Shapiro, Thomas M. %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X This dissertation examines retirement security through an analysis of asset holdings among today's older adults, with a particular focus pre-retirees, who are near retirement. The research seeks to better understand households' retirement resources and later life economic vulnerabilities by: 1.) assessing existing assets among all older U.S. households (51+) and exploring the racial wealth gap among this group; 2.) measuring the direction and magnitude of impacts from several household level economic shocks on the wealth of older households; and 3.) investigating how households prepare for retirement and approach retirement saving. Several theoretical frameworks help to guide the study including the life-cycle hypothesis of saving established by economist Modigliani, life course scholarship by sociologists Elder, Rank, and Kemp, the assets framework expounded by Sherraden and Shapiro, and the institutional model of savings. The mixed-methods study integrates analysis from the Health and Retirement Study (HRS), providing a longitudinal look at the assets of older households 51+ for a decade from 1998 to 2008, and data from semi-structured qualitative interviews. Multivariate fixed effects regression on the panel data assesses the long-term impacts of household economic shocks on wealth. The data reveal largely inadequate savings overall and the racial wealth gap, which has been documented among the general U.S. population, remains large for older adults 51+. The analysis reveals significant negative declines in wealth due to common household events for older adults. Qualitative semi-structured interviews among 16 individuals close to or recently retired (ages 50-65) reveal barriers to saving for retirement such as limited financial knowledge about savings mechanisms, inadequate income sources, and unexpected financial events. The data also point to the important role of institutional structures in shaping retirement decisions. Given the challenges in saving for retirement at the household level, policy should seek to support programs which pool risk across groups, such as Social Security and pensions. Evidence from the study suggests that household-level strategies are likely to be limited in their effectiveness without adequate institutional mechanisms for fostering retirement resources. %I Brandeis University, The Heller School for Social Policy and Management %C Waltham, MA %V 3562811 %P 198 %8 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1399591939?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1399591939 %4 Public policy %$ 999999 %! A Bumpy Road: Asset Accumulation, Unexpected Life Course Events, and Later Life Economic Security %0 Journal Article %J Social security bulletin %D 2013 %T Disability Shocks Near Retirement Age and Financial Well-Being %A Irena Dushi %A Rupp, Kalman %K Employment and Labor Force %K Health Conditions and Status %K Income %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X Using Health and Retirement Study data, the authors examine three groups of adults aged 51 56 in 1992 with different disability experiences over the following 8 years. Our analysis reveals three major findings. First, people who started and stayed nondisabled experienced stable financial security, with substantial improvement in household wealth despite substantial labor force withdrawal. Second, people who started as nondisabled but suffered a disability shock experienced a substantial increase in poverty rates and a sharp decline in median incomes. Average earnings loss was the greatest for that group, with public and private benefits replacing less than half of the loss, whereas the reduction in private health insurance coverage was more than alleviated by the increase in public health insurance coverage. Third, people who started and stayed disabled were behind at the baseline and have fallen further behind on most measures. An important exception is substantial improvement in health insurance coverage because of public safety nets. %B Social security bulletin %I 73 %V 73 %P 23-43 %G eng %N 3 %4 Disability shock/Health status/Health insurance/Poverty rate/Financial well-being/Near-retirement age/safety net/labor Force Participation %$ 69266 %0 Thesis %D 2013 %T Dívida das famílias : uma analise para a Europa (HRS) e EUA (SHARE) para 2006 e 2010 %A Ferrão, Filipe António da Cunha %K Cross-National %K Net Worth and Assets %K Public Policy %K SHARE %X This dissertation investigates the evolution and determinants of the household debts in the United States of America (USA) and also in Europe (EU), before and after the beginning of the financial crises. The amounts and the debt incidence (mortgage and nonmortgage) were compared for the two years observed (2006/07 and 2010). After the presentation and discussion of the relevant literature, the determinants that had influence on the indebtedness in the USA and the EU were empirically tested based on the data from Health And Retirement Study (HRS) wave 8 (2006) and wave 10 (2010) and Survey of Health, Ageing and Retirement in Europe (SHARE) wave 2 (2006) and wave 4 (2010). As the objective is to verify alterations in the individual behavior in the periods pre and post crises, this alteration was analyzed through the observation of the same individual on both moments in time. Various specifications of the Probit model were tested where the dependent variable assumed the value of "one" or "zero" corresponding to the exist of debt or not. The study was conducted taking under consideration the whole set of debts (liability) and also for each type of debt in the European.( Overdue bills, Debt on cars and other vehicles, Debt on credit cards, Loans, Debts to relatives or friends and Student loans ) and the north American case (mortgage and nonmortgage). The EU average debt amount is higher than the USA in both years, suffering an increase from 2006 to 2010, while in the USA it stayed constant, however, the percentage of individuals with any kind of debt stayed similar in both years and both analyzed regions. The results suggest that in the EU, after the crises, was verified a change on the weight of each debt source, with a trade off between the decreasing search of formal financial institutions and the rise of informal debt, obtained from family and friends. The estimated model results show that the age, the in log wealth, the financial risk aversion, marriage and financial savings in general have a negative effect in debt acquirement. On the other hand, having a mortgage, the education (number of years) and having children has a positive effect on debt acquirement. The factors that explain different kinds of debt differ in the analyzed regions and years, noticing that the children"s variable, the health state, education and marriage are exclusively meaningful and present in the EU, opposing the USA, where they show no statistical relevance. %I University of Lisbon %C Lisbon %G eng %4 Debt %$ 999999 %! Dívida das famílias : uma analise para a Europa (HRS) e EUA (SHARE) para 2006 e 2010 %0 Journal Article %J Journal of Epidemiology and Community Health %D 2013 %T Do wealth disparities contribute to health disparities within racial/ethnic groups? %A Craig E Pollack %A Cubbin, Catherine %A Sania, Ayesha %A Mark D Hayward %A Donna M. Vallone %A Flaherty, Brian %A Paula Braveman %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X Background Though wide disparities in wealth have been documented across racial/ethnic groups, it is largely unknown whether differences in wealth are associated with health disparities within racial/ethnic groups. Methods Data from the Survey of Consumer Finances (2004, ages 25 64) and the Health and Retirement Survey (2004, ages 50 ), containing a wide range of assets and debts variables, were used to calculate net worth (a standard measure of wealth). Among non-Hispanic black, Hispanic and non-Hispanic white populations, we tested whether wealth was associated with self-reported poor/fair health status after accounting for income and education. Results Except among the younger Hispanic population, net worth was significantly associated with poor/fair health status within each racial/ethnic group in both data sets. Adding net worth attenuated the association between education and poor/fair health (in all racial/ethnic groups) and between income and poor/fair health (except among older Hispanics). Conclusions The results add to the literature indicating the importance of including measures of wealth in health research for what they may reveal about disparities not only between but also within different racial/ethnic groups. %B Journal of Epidemiology and Community Health %I 67 %V 67 %P 439-445 %G eng %4 sociodemographic characteristics/sociodemographic characteristics/Socioeconomic Differences/health status/wealth/Net Worth %$ 69272 %R 10.1136/jech-2012-200999 %0 Book Section %B Lifecycle Events and Their Consequences: Job Loss, Family Change, and Declines in Health %D 2013 %T Effects of Late-Life Job Loss on Wealth and Labor Supply %A Ann H. Stevens %A Jeremy G. Moulton %E Kenneth A. Couch %E Mary C. Daly %E Julie M Zissimopoulos %K Employment and Labor Force %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X This chapter considers the impact of job loss on economic well-being during retirement. Using data from the Health and Retirement Study (HRS), it compares retirement wealth across individuals who experience a job loss and those who do not. Sizeable differences are reported, especially when the job loss occurs at young ages. Little evidence is found that displaced workers can make up these differences by shifting retirement to a later date. The inability to recover appears related to both the difficulty in becoming reemployed and, if a new job is found, working sufficiently long before retirement to offset the initial declines in assets. %B Lifecycle Events and Their Consequences: Job Loss, Family Change, and Declines in Health %I Stanford University Press %C Stanford, CA %P 57-75 %G eng %4 job loss/displacement/late-life/retirement/wealth %$ 999999 %! Effects of Late-Life Job Loss on Wealth and Labor Supply %0 Thesis %D 2013 %T Essays in public economics %A Lee, Insook %Y Saez, Emmanuel %K Adult children %K Methodology %K Net Worth and Assets %K Public Policy %X My dissertation, "Essays in Public Economics," is comprised of three chapters. The first one, titled "Altruism, Reciprocity, and Equity: A Unified Motive for Intergenerational Transfers" is to address the following question: Why do parents divide bequests equally while transferring inter vivos gifts unequally? Across times and places, why have there mainly been only two extreme choices of distribution of bequests: either to give them to just one child (unigeniture) or to divide them equally (equigeniture)? How can a motive for intergenerational transfers explain both "equal division puzzle" (the former) and polarized inheritance patterns (the latter)? This chapter presents a behavioral model that coherently rationalizes these empirical realities. Namely, as head of a family, a parent altruistically cares about children but also wants them to spend effort for family. However, effort is costly and individual level of each child is unverifiable to a third party adjudicator. Given this incomplete information, there rise only two stable equilibria: either equigeniture or unigeniture. When the productivity of effort rises, the evolution of inheritance pattern from unigeniture to equigeniture occurs. So equigeniture is eventually adopted due to a rise in the productivity throughout industrialization. Furthermore, if the parent wants to counterbalance inequality among children who exert equal effort, the greater amount of inter vivos gift is transferred to a child with lower relative income compared to his siblings, while bequests remain equally divided. This model is consistent with the aforementioned empirical realities but also lends itself to further empirical tests. The second chapter "Retirement and Exposure of Pension to Financial Market Fluctuations" studies how exposure of pension wealth to stock market fluctuations affects retirement behavior both theoretically and empirically. Characteristics of optimal plan for retirement are elaborated with reflecting that liquidizing pension wealth is more tied to retirement decisions than non-pension wealth as well as embodying time-sensitive restrictions on availability of pension benefits. Theoretical analysis finds that exposure of pension to financial market fluctuations does not always entail perfectly symmetric response of retirement. Exposure of pension to a positive shock actually brings responses of retirement only if the magnitude of the positive shock is large enough to compensate for foregone labor earnings and demand for resources necessary for post-retirement consumptions. In particular, whereas exposure of pension to a small negative shock leads to a decrease in retirement, exposure of pension to a positive shock with the same magnitude might not yield an increase in retirement. The third chapter, titled "Optimal Income Taxation and Optimal Revenue Mobilization," analyzes characteristics of nonlinear optimal income taxation and optimal revenue mobilization when the tax enforcement of a government is not costless (and thus not presumed to be perfect). The government cannot observe and verify an individual's innate ability although that ability turns out to cause inequality amongst them. This prevents the government from avoiding efficiency loss in the taxation, since each taxpayer can take advantage of private information over their own ability by reducing working hours to pretend to be less able than he truly is. Optimal income tax schedule is designed to minimize the efficiency loss from deterring such behavior to maximize social welfare. Moreover, the desired expenditure of the government is set for enhancing minimum living standard of society. In executing the tax schedule to finance this, however, tax evasion occurs due to imperfect enforcement. Although the government can verify the true amount of taxpayer's earnings, unlike their ability, it is costly to increase the enforcement rate. The optimal rate equalizes a gain of net increase in the tax revenue with a loss of decreased utility of risk-averse taxpayers from an incre ent in the rate. Notably, this cha ter shows that aggregate loss of tax revenue can theoretically justify non-zero tax rate on top earners. (Abstract shortened by UMI.) %I University of California, Berkeley %C Berkeley, CA %V 3593892 %P 170 %8 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1441350548?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1441350548 %4 0501:Economics %$ 999999 %! Essays in public economics %0 Thesis %D 2013 %T Essays on elderly asset management the role of medical expenses and housing %A Li, Li %Y John Bailey Jones %K Housing %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %K Public Policy %X With baby-boomers approaching their retirement age, the financial security of elderly Americans has become increasingly crucial for both policy-makers and retirees themselves. Based on the data from the Health and Retirement Survey (HRS), this dissertation examines how healthcare costs and housing affect retirees' saving and investment decisions. In chapter 1, I investigate the pattern of asset allocation among elderly Americans and test if large out-of-pocket (OOP) medical expenses were preventing older households from holding risky assets. My results show that the elderly are more likely to own risky financial assets while less likely to own housing assets as their OOP medical expenses go up. And conditional on ownership, relatively large OOP medical expenses are significantly correlated with high share of risky financial assets and low share of housing assets. These results imply that large OOP medical expenses may be capturing something other than poor health, which I explain by a "mechanical" effect that older households sell their houses to finance their large OOP medical expenses, driving up the risky financial assets share. In chapter 2, I develop a life-cycle dynamic programming model that particularly assumes elder homeowners would sell their houses to finance large medical expenses such as nursing home costs. My model finds that retirees with housing are less sensitive to the magnitude of medical expense shocks and thus maintain fewer precautionary savings. Without housing assets, retirees tend to take fewer risks while investing at the early stage of their retirement, but may have to take chances to finance elevated medical expenses as they approach the end of their life cycle. In chapter 3, I relax the borrowing constraint assumed in the prior two chapters and study the impact of health problems and related expenses on elderly households' financial security. I estimate the probability of medical default among 65 and above age group using various qualitative choice models. Results indicate that high medical debt to income ratio rather than OOP medical expense itself contributes to the high probability of default. %I State University of New York at Albany %C Albany, NY %V 3591686 %P 150 %8 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1434876559?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1434876559 %4 0501:Economics %$ 999999 %! Essays on elderly asset management the role of medical expenses and housing %0 Thesis %D 2013 %T Essays on gender differences in occupational choices and cohort analysis of saving adequacy %A Li, Hsueh-Hsiang %Y John Karl Scholz %K Consumption and Savings %K Demographics %K Employment and Labor Force %K Methodology %K Net Worth and Assets %X The first chapter analyzes how human capital depreciation affects occupational gender segregation. Prior studies are biased because, given an occupational depreciation rate, female workers endogenously choose the duration of leave. I address this problem by proposing an alternative depreciation measure utilizing involuntary job displacement shocks. Using this depreciation proxy along with additional pecuniary and non-pecuniary occupational attributes, I estimate a conditional logit model of occupational choices separately for male and female college graduates using NLSY79 data. The results show that men and women differ largely in selection on many occupational attributes, however, the gender difference in depreciation is statistically insignificant after accounting for additional variance from the generated depreciation regressor. The second chapter explores the trend of gender differences in selection on occupational mobility. Women who interrupt their career and return to the labor force face the uncertainty of forming a new job match. This uncertainty can be large if the skills they acquired are occupational-specific. I estimate discrete occupational choices by different cohorts using cross-sectional Current Population Survey (CPS) from 1979 to 2008.I find that over the past 30 years, the consideration of occupational mobility has abated in female occupational decisions. In addition, gender gaps in work hours and visual perception also narrow over the past thirty years. Increasing female representation is evident in occupations with high entry barriers, long work hours, and visual intensive tasks. In the third chapter, we extend the dynamic programming approach used in Scholz, Seshadri, and Khitatrakun (2006) to assess the adequacy of retirement wealth preparation in 2008, using a sample of Americans born before 1954. We examine whether these households have accumulated the wealth necessary to maintain pre-retirement living standards in retirement. Our preliminary results suggest that over 70 percent of the households in our sample had accumulated sufficient resources in 2008. The results suggest a less optimistic view about the adequacy of Americans' retirement preparation than the findings for 1992 in Scholz, Seshadri, and Khitatrakun (2006). Economically disadvantaged households are significantly more likely than others to be under-saving and hence are natural targets for outreach and other efforts to improve financial capabilities. %I The University of Wisconsin - Madison %V 3590468 %P 103 %8 Jul 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1432177424?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/Dissertations+%26+Theses+%40+CIC+Institutions&rft_val_fmt=info:ofi/fmt:kev:mtx:dis %9 Ph.D. %M 1432177424 %4 labor Force %$ 69206 %! Essays on gender differences in occupational choices and cohort analysis of saving adequacy %0 Thesis %D 2013 %T Essays on Labor Economics %A Tanaka, Atsuko %Y John Kennan %K Cross-National %K Employment and Labor Force %K Health Conditions and Status %K Methodology %K Net Worth and Assets %K Other %X This dissertation investigates determinants of labor supply decision and worker productivity. In the first two chapters, I investigate inefficiency due to statistical discrimination, in which employers---who do not observe the individual worker's labor force intention---offer a female worker fewer human capital investment opportunities than a male worker because of women's weaker labor force attachment. Owing to imperfect information, productivity inefficiency arises when women receive the same amount of investment despite the fact that women with shorter job tenure are potentially less productive than other workers. To study such a situation, I develop a model of statistical discrimination with a screening mechanism. In the third chapter, a joint project with Laurel Beck, I shift focus from statistical discrimination to worker's mental health as determinants of worker productivity. The first chapter applies the above model empirically to Japanese data, whose features exhibit evidence for statistical discrimination. The Japanese female labor market is found to be in a pooling equilibrium, thereby allowing statistical discrimination. I then estimate the effects of child-care subsides on the degree of statistical discrimination. The counterfactual analysis shows that child-care subsides could bring a drastic change in efficiency to Japan by altering the equilibrium of the worker-firm game from pooling to separating. The second chapter theoretically examines the factors that further complicate the screening process. I argue that long-term wage contracts implicitly distribute compensation from the employed to the unemployed and thus provide workers collective bargaining over wages. This finding allows us a new way to understand long-term contracts. The third chapter examines the effect of depression on various labor force outcomes. We use panel data from the Japanese Panel Survey of Consumers (JPSC) and the Health and Retirement Study (HRS) to follow respondents over several years, using questions about both mental health and labor force outcomes. In order to understand the causal effect of depression on work participation and compensation, we use deaths of the parents or children of respondents as an exogenous shock to mental health, and assess the impact of that event over time. %I The University of Wisconsin - Madison %V 3589854 %P 167 %8 May 2013 %G English %9 Ph.D. %M 1430930606 %4 mental Health %$ 69202 %! Essays on Labor Economics %0 Thesis %D 2013 %T Essays on Saving Behavior %A Meryl Motika %Y David Neumark %K Consumption and Savings %K Health Conditions and Status %K Methodology %K Net Worth and Assets %X This dissertation combines three projects studying saving behavior. The first chapter presents a model of reference-dependent retirement saving behavior using a gain-loss utility function drawn from prospect theory. I show that this model predicts empirical characteristics of retirement saving behavior including adherence to defaults, under-saving, and the positive correlation between saving rates and financial knowledge. An additional testable implication of the model is that more financially-knowledgeable individuals will have wider variance than people with low financial knowledge. Using data from the Health and Retirement Study, I show that this implication is also supported by empirical results. The second chapter investigates the effects of financial training and planning on saving in a laboratory experiment. Subjects choose when to use tokens to watch video clips over the course of a 50-minute session. Boredom encourages subjects to use tokens immediately, while increased video length in later rounds creates an incentive to use them later. Subjects who receive minimal instructions tend to use their tokens early. Intensive training increases saving rates. The planning treatment has no effect on low-training subjects, but leads intensively trained subjects to smooth tokens across the five rounds rather than spending early or waiting until the end. Evidence from correlations between spending tokens early and high elicited discount rate, as well as subjects' comments about struggling to wait before using tokens, provide support for the external validity of this experiment design. The third chapter examines the relationship between `Big 5' personality traits and low saving rates. Several traits are shown to predict under-saving, with low conscientiousness being particularly important and robust. I then investigate whether personality traits also explain the effects of education, financial literacy, and financial planning. This might occur if certain personality types tended to participate in these activities and also tended to save. I find that the effects of education and financial literacy are robust to personality. The influence of financial planning might be explainable by personality-based selection. %I University of California, Irvine %C Irvine, CA %V 3565428 %P 104 %8 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1413316840?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1413316840 %4 0501:Economics %$ 999999 %! Essays on Saving Behavior %0 Thesis %D 2013 %T Essays on the Economics of Tobacco Harm Reduction and on Financial Literacy and Retirement Decision-Making %A Maki, Jennifer Anne %Y Goodwin, Barry Morrill Melinda %K End of life decisions %K Methodology %K Net Worth and Assets %K Risk Taking %X This dissertation consists of four essays exploring policies and practices that highlight the role of information on decision making. The first two essays can be broadly described as evaluating policies pertaining to tobacco harm reduction--the practice of recommending the use of a less harmful tobacco alternative to those smokers who are unwilling or unable to quit smoking. If oral tobacco use is less harmful than cigarette smoking, consumers may be better off by substituting one product for the other. Although the risk associated with oral tobacco use has been studied in the past, previous estimates may be biased as they did not account for the role of risky behavior which is correlated with both health outcomes and tobacco use. To address this, I undertake an analysis of the association between oral tobacco and oral cancer, while controlling for risky health behaviors. My findings show that when controlling for risky sexual behavior, the estimated causal effect of oral tobacco use on oral cancer is significantly diminished. A better understanding of the true costs (in terms of health risks) associated with use of oral tobacco will allow individuals to make consumption decisions which maximize utility and encourage cost effective and efficient tobacco control policies. If smokers are made aware of the differing health risks between cigarette smoking and oral tobacco use, they may be able to improve their well-being by substituting one product for the other. However, labeling oral tobacco as a less harmful alternative may induce usage by those who would have otherwise abstained from tobacco use. To better understand these opposing consequences, I explore a policy change in Finland. Finland implemented a ban on the sale of oral tobacco when joining the European Union in 1995. I estimate that removing this less harmful alternative from the market increased the smoking rate, relative to what it would have been, by using the neighboring country of Sweden as a counterfactual. The second two essays look at improving employee retirement readiness through actions undertaken at the firm level. The employer sponsored 401(k) plan can be an effective tool in saving for retirement, yet many employees do not participate. If non-participation is due to low levels of financial literacy or due to inertia, an intervention may be effectual in encouraging participation. In my third essay, I report on the effectiveness of a simple informational intervention that highlighted the value of saving in conjunction with the employer match. This one page flyer demonstrated how saving today can lead to substantial wealth accumulation over time. I find that the intervention increases participation rates among younger employees relative to a control group. In the final essay, I explore the effect of pre-retirement seminars on the financial literacy and retirement plans of older employees at several large firms. These seminars are designed to provide information which will assist employees in making the important decisions they will face when transiting into retirement. Results suggest that participation did lead to an increase in financial literacy and that this learning is associated with a change in retirement plans. These last two essays underscore the importance of financial literacy in retirement planning, preparedness, and decision-making. %I North Carolina State University %C Raleigh, NC %V 3575643 %P 188 %8 2013 %G English %9 Ph.D. %M 1459432336 %4 Economic theory %! Essays on the Economics of Tobacco Harm Reduction and on Financial Literacy and Retirement Decision-Making %0 Journal Article %J Journal of Aging and Social Policy %D 2013 %T Evidence that Self-Regulatory Mode Affects Retirement Savings %A Hyungsoo Kim %A Franks, Becca %A Higgins, E. Tory %K Consumption and Savings %K Demographics %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X We examine how self-regulatory motivations of locomotion (initiation) and assessment (evaluation) are related to retirement wealth in middle-aged and older Americans. We test a hypothesis that high locomotion and some assessment levels predict high wealth levels. We use two national data sets: the 2008 Health and Retirement Study (N = 6,464) and the 2005 Midlife in the United States (N = 4,963). We found that a combination of high locomotion and moderate assessment motivation can maximize wealth accumulation. By creating this combination of locomotion and assessment motivations, policy interventions can be more effective in motivating wealth accumulation for retirement, such as a required annual review of retirement savings plans and understandable disclosure of the plans' costs. PUBLICATION ABSTRACT %B Journal of Aging and Social Policy %I 25 %V 25 %P 248-263 %G eng %N 3 %4 net worth/retirement Saving/Retirement planning/Savings/Older people/Locomotion/Motivation/wealth Accumulation/Public Policy %$ 69062 %R 10.1080/08959420.2013.791788 %0 Thesis %D 2013 %T An Examination on Un-Retirement: Retirees Returning to Work %A Guillermo Ernest Gonzales %Y Morrow Howell, Nancy %K Adult children %K Employment and Labor Force %K Healthcare %K Methodology %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X Research that examines retirees returning to work--defined here as un-retirement--is important, given increases in life expectancy and retirement insecurity. Unfortunately research in this area is nascent, limited in scope, and riddled with mixed findings. The current study is guided by three research questions: (1) how do economic resources, as well as human and social capital, relate to un-retirement?; (2) how do other productive activities, including formal and informal volunteering and caregiving, relate to un-retirement?; and (3) how does the retirement experience, including reasons to retire and retirement satisfaction, relate to un-retirement? The empirical literature on wealth and its association with un-retirement is mixed, and thus, an exploratory approach is taken. It is hypothesized that other economic resources (income, pension presence, and health insurances) are negatively related to un-retirement; for example, people with lower levels of income are more likely to return to work. It is hypothesized that higher levels of human capital and social capital are positively associated with un-retirement. It is also hypothesized that productive activities both compete with, and complement each other, and it depends on intensity and timing of events. Specifically, volunteering is a positively associated with un-retirement; that is volunteering complements going back to work. It is also suggested that caregiving is a barrier to un-retirement; that is, the two activities compete. It is hypothesized that forced retirement is positively associated with un-retirement. And finally, it is hypothesized that retirement satisfaction is negatively associated with un-retirement. Data were drawn from the Health and Retirement Study (HRS) which provided a nationally representative sample of fully retired older adults aged 62 and older in 1998 (n=8,334). This sample was followed to 2008, which offered a 10-year period to observe factors associated with un-retirement. The fully conditional specification imputation method was used to complete all missing values of the study variables. Survival analysis tested the hypotheses and yielded information on the significant factors associated with un-retirement. Findings reveal that total household net worth and income were not significantly related to un-retirement. Retirees who possessed a pension (p <.05, hazard ratio (HR):0.78, confidence limits (CL):0.63-0.97) and employer sponsored retiree health insurance (p <.05, HR:0.77, CL:0.62-0.95) were 22% and 23% less likely to return to work when compared to people who did not possess such economic resources for retirement. Generally, individuals with higher levels of human capital--better health (p <.0001, HR:1.31, CL:1.20-1.44), high-skilled (p <.05, HR:1.82, CL:1.20-2.75) and mid-skilled occupational workers (p <.05, HR:1.57, CL:1.07-2.28)--were more likely to return to work when compared to low-skilled occupational workers. This suggests that the probability of returning to work increased by 31% for every one unit increase in self-rated health; and the probability of returning to work were 82% and 57% higher for high and mid-skilled workers compared to low-skilled workers. Education, however, was negatively related to un-retirement when other productive activities were examined ( p <.05, HR: 0.96, CL:0.93-0.99), which suggests that for every unit increase in education, the probability of returning to work decreased by 4%. Certain dimensions of social capital were also significantly related to un-retirement; where the probability of returning to work increased by 75% for people who were married to an employed spouse/partner ( p <.0001, HR:1.75, CL:1.36-2.23). Formal and informal volunteering were significant predictors to work; where volunteers were between 38% and 58% more likely to return to work when compared to non-volunteers. However, providing care to a spouse was a major barrier to returning to work; where caregivers were approximately 80% less likely to return to work in subsequent waves when ompared to non-caregivers ( p <.01 %I Washington University in St. Louis %C St. Louis, MO %V 3593208 %P 112 %8 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1438181057?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Ph.D. %M 1438181057 %4 0452:Social work %$ 999999 %! An Examination on Un-Retirement: Retirees Returning to Work %0 Journal Article %J Journal of Financial Therapy %D 2013 %T Financial Ratios and Perceived Household Financial Satisfaction %A Garrett, Scott %A Russell N. James III %K Methodology %K Net Worth and Assets %X This paper tests the relative strength of three objective measures of financial health (using the solvency, liquidity, and investment asset ratio) in predicting a household s subjective feeling of current financial satisfaction. Using a sample of 6,923 respondents in the 2008 Health and Retirement Study this paper presents evidence of two main findings: 1) the solvency ratio is most strongly associated with financial satisfaction levels based on a cross-sectional design and 2) changes in the investment asset ratio are most strongly associated with changes in financial satisfaction over time. %B Journal of Financial Therapy %I 4 %V 4 %P 4 %G eng %N 1 %4 Financial Satisfaction/Ratios/Financial Planning/Financial Counseling %$ 999999 %R http://dx.doi.org/10.4148/jft.v4i1.1839 %0 Journal Article %J Journal of Financial Therapy %D 2013 %T Financial Ratios and Perceived Household Financial Satisfaction %A Garrett, Scott %A Russell N. James III %K Methodology %K Net Worth and Assets %X This paper tests the relative strength of three objective measures of financial health (using the solvency, liquidity, and investment asset ratio) in predicting a household s subjective feeling of current financial satisfaction. Using a sample of 6,923 respondents in the 2008 Health and Retirement Study this paper presents evidence of two main findings: 1) the solvency ratio is most strongly associated with financial satisfaction levels based on a cross-sectional design and 2) changes in the investment asset ratio are most strongly associated with changes in financial satisfaction over time. %B Journal of Financial Therapy %I 4 %V 4 %G eng %N 1 %4 financial satisfaction/ratios/financial therapy/financial planning/financial exploitation/Financial counseling %$ 999999 %R 10.4148/jft.v4i1.1839 %0 Journal Article %J International Review of Applied Economics %D 2013 %T Gender preference and transfers from parents to children: an inter-regional comparison %A Edwin S. Wong %K Adult children %K Cross-National %K Demographics %K Methodology %K Net Worth and Assets %X This paper examines whether parents exhibit gender preference in the allocation of family resources to their adult children. Gender preference is defined in the context of an altruistic model for inter-vivos transfer from parents to children extended to include educational investment. Data from the Health and Retirement Study (United States) and the Korean Longitudinal Study of Ageing are used to show that the degree of gender preference differs across these culturally distinct regions. Among Korean families, empirical results point to male preference as sons receive larger inter-vivos transfers and attain higher levels of education compared with daughters. In contrast, the evidence pertaining to gender preference among American families points to daughter preference as inter-vivos transfers and educational investment is generally higher among female adult children. PUBLICATION ABSTRACT %B International Review of Applied Economics %I 27 %V 27 %P 61 %G eng %N 1 %4 gender preference/gender/cross-national comparison/Cross Cultural Comparison/inter Vivos Transfers/Families/Sex preselection/Resource allocation/Living trusts/parent Child Relations %$ 69740 %0 Journal Article %J American journal of public health %D 2013 %T Gender-stratified models to examine the relationship between financial hardship and self-reported oral health for older US men and women %A Chi, Donald L. %A Reginald D. Tucker-Seeley %K Demographics %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %X OBJECTIVES: We evaluated the relationship between financial hardship and self-reported oral health for older men and women. METHODS: We focused on adults in the 2008 Health and Retirement Study (n=1,359). The predictor variables were 4 financial hardship indicators. We used Poisson regression models to estimate the prevalence ratio of poor self-reported oral health. RESULTS: In the non-gender-stratified model, number of financial hardships was not significantly associated with self-reported oral health. Food insecurity was associated with a 12 greater prevalence of poor self-reported oral health (95 confidence interval CI =1.04, 1.21). In the gender-stratified models, women with 3 or more financial hardships had a 24 greater prevalence of poor self-reported oral health than women with zero (95 CI=1.09, 1.40). Number of hardships was not associated with self-reported oral health for men. For men, skipping medications was associated with 50 lower prevalence of poor self-reported oral health (95 CI=0.32, 0.76). CONCLUSIONS: Number of financial hardships was differentially associated with self-reported oral health for older men and women. Most financial hardship indicators affected both genders similarly. Future interventions to improve vulnerable older adults' oral health should account for gender-based heterogeneity in financial hardship experiences. %B American journal of public health %I 103 %V 103 %P 1507-15 %G eng %N 8 %4 Gender/ORAL-HEALTH/SELF-RATED HEALTH/financial hardships %$ 69130 %R 10.2105/ajph.2012.301145 %0 Report %D 2013 %T Health, Education, and the Post-Retirement Evolution of Household Assets %A James M. Poterba %A Steven F Venti %A David A Wise %K Demographics %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper explores the relationship between education and the evolution of wealth after retirement. Asset growth following retirement depends in part on health capital and financial capital accumulated prior to retirement, which in turn are strongly related to educational attainment. These initial conditions for retirement can have a lingering effect on subsequent asset evolution. Our aim is to disentangle the effects of education on post-retirement asset evolution that operate through health and financial capital accumulated prior to retirement from the effects of education that impinge directly on asset evolution after retirement. We consider the indirect effect of education through financial resources in particular Social Security benefits and defined benefit pension benefits and through health capital that was accumulated before retirement. We also consider the direct effect of education on asset growth following retirement, emphasizing the correlation between education and the returns households earn on their post-retirement investments. Households with different levels of education invest, on average, in different assets, and they may consequently earn different rates of return. Finally, we consider the additional effects of education that are not captured through these pathways. Our empirical findings suggest a substantial association between education and the evolution of assets. For example, for two person households the growth of assets between 1998 and 2008 is on average much greater for college graduates than for those with less than a high school degree. This difference ranges from about 82,000 in the lowest asset quintile to over 600,000 in the highest. %I Cambridge, MA, National Bureau of Economic Research %G eng %4 education/wealth/asset accumulation/household finances/retirement planning/health capital/health capital %$ 69270 %0 Thesis %D 2013 %T Health shocks in patients with cancer: A longitudinal analysis of financial and retirement trends using the Health and Retirement study %A Adrienne M. Gilligan %Y Grant H Skrepnek %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Other %K Public Policy %K Retirement Planning and Satisfaction %X Objectives: Evaluate the association of cancer on net worth, consumer debt, mortgage debt, home equity and changes in retirement trends. Methods: Data from the Health and Retirement Study from 1998-2010 was used. Persons had to have a diagnosis of cancer. The index date was the corresponding HRS wave of the year of the first diagnosis of cancer. The pre-index date was 2 years and a 2-year and 4-year post index was observed. Primary outcomes of interest were zero/negative net worth and net worth. Multiple logistic regression was used to test for the association between demographic, economic, human capital, and cancer-related variables on outcomes. Generalized linear models were conducted to assess the association of cancer on net worth, consumer debt, mortgage debt, and home equity. Multinomial logistic regression was performed to assess the association of cancer on retirement. Results: A total of 6,055,110 individuals (weighted) qualified. The majority of patients in this sample were male (53.8%), non-Hispanic (95.5%), and white (90.3%). Marital status (p<0.05), alcohol consumption (p=0.046), hypertension (p = 0.034), private insurance (p=0.001), cancer status (p<0.001), and cancer treatment (p=0.022) were significant predictors of zero/negative net worth 4-years after cancer diagnosis. Patients receiving treatment for their cancer were 71% more likely to have consumer debt 4-years post diagnosis (p=0.006). Patients who reported their cancer improving 4-years post diagnosis were significantly less likely (p=0.008) to have consumer debt (OR=0.59; 95%CI: 0.41-0.87). Cancer treatment and cancer status were significant predictors of mortgage debt (p<0.001 and 0.024, respectively). For individuals whose cancer either improved (OR=1.46; 95%CI: 1.04-2.06) or worsened (OR=4.09; 95%CI: 1.38-12.15), both groups were significantly more likely (p=0.030 and 0.011, respectively) to have home equity 4-years post diagnosis. Cancer status was a significant predictor of individuals transitioning from working to retired (p=0.022). Conclusion: This nationally representative investigation of 6.1 million patients over 50 years of age with cancer found that approximately 65% of cancer patients reported zero/negative net worth of cancer and almost 45% of cancer patients reported consumer debt four-years post diagnosis. Cancer-related characteristics explain a significant amount of the change in net worth four-years post diagnosis of cancer. %I The University of Arizona %V Ph.D. %P 267 %8 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1354473932?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+Full+Text&rft_val_fmt=info:ofi/fmt:kev:mtx:disse %9 Dissertation %M prod.academic_MSTAR_1354473932 %4 mortgage debt %$ 69014 %! Health shocks in patients with cancer: A longitudinal analysis of financial and retirement trends using the Health and Retirement study %0 Journal Article %J Population Research and Policy Review %D 2013 %T Healthier, Wealthier, and Wiser: A Demonstration of Compositional Changes in Aging Cohorts Due to Selective Mortality %A Zajacova, Anna %A Sarah A. Burgard %K Health Conditions and Status %K Methodology %K Net Worth and Assets %X The gradual changes in cohort composition that occur as a result of selective mortality processes are of interest to all aging research. We present the first illustration of changes in the distribution of specific cohort characteristics that arise purely as a result of selective mortality. We use data on health, wealth, education, and other covariates from two cohorts (the AHEAD cohort, born 1900-1923 and the HRS cohort, born 1931-1941) included in the Health and Retirement Survey, a nationally representative panel study of older Americans spanning nearly two decades (N = 14,466). We calculate sample statistics for the surviving cohort at each wave. Repeatedly using only baseline information for these calculations so that there are no changes at the individual level (what changes is the set of surviving respondents at each specific wave), we obtain a demonstration of the impact of mortality selection on the cohort characteristics. We find substantial changes in the distribution of all examined characteristics across the nine survey waves. For instance, the median wealth increases from about 90,000 to 130,000 and the number of chronic conditions declines from 1.5 to 1 in the AHEAD cohort. We discuss factors that influence the rate of change in various characteristics. The mortality selection process changes the composition of older cohorts considerably, such that researchers focusing on the oldest old need to be aware of the highly select groups they are observing, and interpret their conclusions accordingly. PUBLICATION ABSTRACT %B Population Research and Policy Review %I 32 %V 32 %P 311-324 %G eng %U http://search.proquest.com.proxy.lib.umich.edu/docview/1356972849?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004andctx_enc=info:ofi/enc:UTF-8andrfr_id=info:sid/ProQ 3Aabiglobalandrft_val_fmt=info:ofi/fmt:kev:mtx:journalandrft.genre=articl %N 3 %4 Mortality/Aging/selective mortality processes/cohort composition/wealth %$ 69006 %R http://dx.doi.org/10.1007/s11113-013-9273-x %0 Journal Article %J The Journal of Law and Economics %D 2013 %T How Does Bankruptcy Law Impact the Elderly' s Business and Housing Decisions? %A Nadia Greenhalgh-Stanley %A Rohlin, Shawn %K Housing %K Net Worth and Asset %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X The elderly are the population most likely to file for bankruptcy, with filings increasing by 150 percent from 1991 to 2007. This is likely because they live with relatively flat incomes and high medical expenses, and their retirement and housing assets are typically exempt from bankruptcy filings. In addition, nine states adopted higher asset exemptions specifically for the elderly. Using the Health and Retirement Study and recent state-by-time variation in homestead exemptions, we are the first to test whether the benefits of partial wealth insurance or the cost of supply-side credit constraints are predominant for the elderly. Using pooled cross-sectional analysis, we find that an increase in a state' s homestead exemption increases the elderly' s home equity and business ownership; however, the credit constraint is dominant in unlimited-exemption states, which decreases home and business ownership. Panel analysis reveals that an increase in the homestead exemption positively affects home ownership rates and home equity. %B The Journal of Law and Economics %I 56 %V 56 %P 417-451 %G eng %U http://www.jstor.org/stable/10.1086/670911 %N 2 %4 home equity/bankruptcy/Retirees/retirement planning/homestead exemption/Public Policy/assets/Housing %$ 69086 %R 10.1086/670911 %0 Report %D 2013 %T How Does Retiree Health Insurance Influence Public Sector Employee Saving? %A Robert Clark %A Olivia S. Mitchell %K Insurance %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X 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. %I Cambridge, MA, National Bureau of Economic Research %G eng %4 retiree health insurance/household wealth/Public Sector/employer-provided health insurance %$ 999999 %0 Journal Article %J Annals of Economics and Finance %D 2013 %T The impact of house price movements on non-durable goods consumption of older households %A Shenyi Jiang %A Wei Sun %A Anthony Webb %K Net Worth and Assets %X Using Health and Retirement Study (HRS) data, we create a new, up-to-date panel dataset to investigate the impact of house price movements on the non-durable goods consumption of older households. We find that older homeowners respond asymmetrically when experiencing house price gains and house price losses. More specifically, they increase total non-durable goods expenditure when house prices appreciate, but fail to reduce consumption when house prices fall. %B Annals of Economics and Finance %I 14 %V 14 %P 491-510 %G eng %U http://www.scopus.com/inward/record.url?eid=2-s2.0-84874026500andpartnerID=40andmd5=9b24de128cf6ceeaf4346ecc7151389a %N 2 %4 House price fluctuations/Household consumption/Asset accumulation %$ 69150 %0 Journal Article %J Journal of Financial Counseling and Planning %D 2013 %T The impact of immigrant status and racial/ethnic group on differences in responses to a risk aversion measure %A Fang, M. C. %A Sherman D. Hanna %A Chatterjee, Swarn %K Demographics %K Net Worth and Assets %K Risk Taking %X Factors related to differences in risk aversion were analyzed with a measure of risk aversion inferred from answers to a hypothetical income gamble question in the U.S. Health and Retirement Study. Cumulative logistic regressions, controlling for income, age, gender, health status, current job status, and home ownership, showed that Blacks were more risk averse than Whites, but Hispanics born in the United States were not different from Whites. U.S. born respondents in an other group, largely Asian, were also not different from Whites. Hispanics and those in the other group who were immigrants were more risk averse than Whites. Racial/ethnic differences found in other risk aversion studies may be partly due to differences in immigrant status. 2013 Association for Financial Counseling and Planning Education. All rights of reproduction in any form reserved. %B Journal of Financial Counseling and Planning %I 24 %V 24 %P 63-76 %G eng %U http://www.scopus.com/inward/record.url?eid=2-s2.0-84892566141andpartnerID=40andmd5=4e12b8c031640244bc493910cb0f6d15 %N 2 %4 Investments/Immigrants/Racial/ethnic differences/Risk aversion/Risk tolerance %$ 999999 %0 Report %D 2013 %T Inheritance Reporting in the Health and Retirement Study Data: Evidence of Forward Telescoping %A Gouskova, Elena %K Adult children %K Event History/Life Cycle %K Methodology %K Net Worth and Assets %X Intergenerational transfers are often under-reported in household surveys (Laitner and Sonnega, 2010). This paper demonstrates that over-reporting can be an issue as well. Using data from the 1992-2008 Health and Retirement Study, a biannual longitudinal survey, we find that the first autocorrelations of inheritance reports are substantially higher than autocorrelations at longer lags. This evidence is consistent with over-reporting due to forward telescoping. We estimate that, of all inheritances reported in a survey wave, 5 to 10 had been already reported in the prior wave. This results in a similar magnitude overestimation of total two-year amounts of inheritance transfers. Additionally, this reporting error affects regression estimates, when inheritance measures are used as independent variables. In an example of regression analysis, we find that parameter estimates of inheritance variables are biased toward zero by about 2 to 12 . To mitigate forward telescoping in inheritance reports, it is advisable to employ bounded/dependent interviewing in longitudinal surveys. %I Ann Arbor, MI, Institute for Social Research %G eng %U https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2267507 %4 Wealth/Inheritances/Data collection methodology/Data analysis/intergenerational transfer/reporting errors %$ 69264 %0 Journal Article %J Journal of Risk and Insurance %D 2013 %T The Life Care Annuity: A New Empirical Examination of an Insurance Innovation That Addresses Problems in the Markets for Life Annuities and Long-Term Care Insurance %A Brown, Jason %A Mark J. Warshawsky %K Disabilities %K Health Conditions and Status %K Insurance %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %X The integration of the life annuity with long-term care insurance coverage is intended to deal with major problems in the currently separate markets for life annuities and long-term care insurance. The integration would allow the inclusion of most of the population currently rejected by underwriting those in poor health or lifestyles but who would not go immediately into long-term care claim who also have lower life expectancies. We make use of the Health and Retirement Study, on individuals in retirement and their disability incidence, exploiting the panel nature of the survey to estimate transition probabilities in and out of disability states according to numerous demographic and health characteristics. This allows for analysis of disability and mortality risk across a number of dimensions. We find that different risk groups at age 65 have similar projected long-term care expenses, but that the level-periodic-premium structure of most long-term care insurance policies creates incentives for individuals to separate into different risk pools according to observable characteristics, justifying the underwriting observed on the market. Yet we also find that gender-rated life care annuities could succeed in pooling risks currently segmented in the market for long-term care insurance, thus qualifying individuals at or near retirement for permanent long-term care insurance coverage who do not currently qualify, and allowing for life annuities to be purchased more cheaply than in the stand-alone annuity market now subject to adverse selection. %B Journal of Risk and Insurance %I 80 %V 80 %P 677-704 %G eng %N 3 %4 long term care insurance/Annuities/mortality risk/mortality risk/disability/disability/Insurance %$ 69124 %R 10.1111/j.1539-6975.2013.12013.x %0 Journal Article %J Journal of Risk and Uncertainty %D 2013 %T Life expectancy as a constructed belief: Evidence of a live-to or die-by framing effect %A Payne, John W. %A Sagara, Namika %A Shu, Suzanne B. %A Appelt, Kirstin C. %A Johnson, Eric J %K Expectations %K Health Conditions and Status %K Healthcare %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Life expectations are essential inputs for many important personal decisions. We propose that longevity beliefs are responses constructed at the time of judgment, subject to irrelevant task and context factors, and leading to predictable biases. Specifically, we examine whether life expectancy is affected by the framing of expectations questions as either live-to or die-by, as well as by factors that actually affect longevity such as age, gender, and self-reported health. We find that individuals in a live-to frame report significantly higher chances of being alive at ages 55 through 95 than people in a corresponding die-by frame. Estimated mean life expectancies across three studies and 2300 respondents were 7.38 to 9.17 years longer when solicited in a live-to frame. We are additionally able to show how this framing works on a process level and how it affects preference for life annuities. Implications for models of financial decision making are discussed. PUBLICATION ABSTRACT %B Journal of Risk and Uncertainty %I 46 %V 46 %P 27 %G eng %N 1 %4 Longevity/Annuities/Retirement planning/Economic models/methodology/Life expectancy/behavior %$ 69766 %0 Thesis %D 2013 %T The Long-Term Costs of Caring: How Caring for an Aging Parent Impacts Wealth Trajectories of Caregivers %A Jennifer C. Greenfield %Y Morrow-Howell, Nancy %K Adult children %K Health Conditions and Status %K Healthcare %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %X Long-term care in the U.S. is a growing concern as our aging population exerts pressure on formal and informal care systems. Public expenditures on formal care are increasing rapidly, even as reliance on informal caregivers expands. Recent policy innovations are shifting Medicaid and Medicare funding toward home- and community-based services (HCBS) as an alternative to nursing home care. This may help reduce overall LTC care costs to states and the federal government, but it also shifts more responsibility to families and informal care networks. Not only can caregiving have negative impacts on the physical and mental health of caregivers, but it also can be expensive, both in terms of direct costs and in terms of lost wages and work opportunities. However, to date, these financial consequences are not fully understood. This project uses longitudinal, nationally representative data from six waves of the Health and Retirement Study (1998-2008) to evaluate whether caring for aging parents impacts caregivers' assets over time. Latent trajectory analysis was used to identify groups for whom caregiving had a negative impact on wealth trajectories. A four-group model fit best and revealed one group, with 4.3% of respondents, for whom caregiving had a significant, negative relationship. Further, race, education, and caregivers' health were significantly related to these trajectories. Gender and marital status were not related. Lastly, among caregivers, care duration did not significantly impact asset trajectories, and care intensity had mixed effects. Findings indicate that caring for an aging parent has a significant, negative impact for some adults over age 50, but only for a small group. Importantly, those who are negatively impacted are more likely to be in already vulnerable groups. As reliance on informal caregiving increases, special attention should be paid to those caregivers who may be particularly vulnerable to the financial impacts of caregiving; better assessments and more economic supports are needed to offset the potential exacerbating impacts of caregiving. %I Washington University in St. Louis %V Ph.D. %P 128 %8 May 2013 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1353672076?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&rfr_id=info:sid/ProQuest+Dissertations+%26+Theses+A%26I&rft_val_fmt=info:ofi/fmt:kev:mtx:dissertat %9 Dissertation %M prod.academic_MSTAR_1353672076 %4 Informal care %$ 69018 %! The Long-Term Costs of Caring: How Caring for an Aging Parent Impacts Wealth Trajectories of Caregivers %0 Thesis %D 2013 %T Managing retirement resources: evidence from the HRS %A Chris Browning %K Expectations %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Households are required to make a variety of decisions in pursuit of their retirement goals. These decisions are often complex and require the estimation and input of multiple factors when analyzing alternatives. Complexity and uncertainty have been found to lead to behavioral biases and a dependence on heuristics when making decisions. These deficiencies create a failure to incorporate valuable information, an overreliance on recent events, and inaccurate estimations of future outcomes. When these factors are combined with widespread low levels of financial sophistication and declining cognition the result is often behavior that is contradictory to rational expectations and detrimental to lifetime wealth and utility. Households are bound at a variety of levels by the limitations described above. Sophisticated households and those with higher levels of cognitive ability are more likely to participate in financial markets, enjoy higher returns on investments, and greater levels of wealth. Those with less sophistication and cognitive ability may fail to understand complex financial products, have less consistent preferences, and be more likely to engage in behavior that is inconsistent and detrimental to long-term goals and overall well-being. Given the variation in levels of financial sophistication and cognitive ability, we seek to evaluate how households make decisions in the face of market complexity, and in some cases how these decisions affect financial outcomes. Using the Health and Retirement Study (HRS) we give special focus to the decisions and behavior of older households. We look specifically at the impact of financial sophistication on individuals' ability to accurately value life annuities, how cognitive ability is related to stock reallocations during the great recession, and how cognitive ability relates to the asset decumulation decisions of retirees. %I Texas Tech University %C Lubbock, TX %V PhD %G eng %U http://hdl.handle.net/2346/58201 %4 expectations %$ 999999 %! Managing retirement resources: evidence from the HRS %0 Book Section %B Lifecycle Events and Their Consequences: Job Loss, Family Change, and Declines in Health %D 2013 %T Marriage and Wealth Changes at Older Ages %A Julie M Zissimopoulos %E Kenneth A. Couch %E Mary C. Daly %E Julie M Zissimopoulos %K Adult children %K Event History/Life Cycle %K Health Conditions and Status %K Income %K Net Worth and Assets %X This chapter presents an examination of the impact on net worth and savings of changes in family structure at older ages. The analysis demonstrates that married couples have more wealth than unmarried individuals primarily due to the higher lifetime earnings and lower mortality risk of married couples compared to unmarried individuals. Divorce at older ages both divides and consumes wealth and has negative and long-lasting consequences on wealth accumulation while remarriage rebuilds assets. %B Lifecycle Events and Their Consequences: Job Loss, Family Change, and Declines in Health %I Stanford Economics and Finance %C Stanford, CA %P 158-177 %G eng %4 marriage/divorce/wealth/life-cycle/earnings/mortality risk/mortality risk %$ 999999 %! Marriage and Wealth Changes at Older Ages %R DOI:10.11126/stanford/9780804785853.003.0009 %0 Thesis %D 2013 %T Multivariate fractional response models in a panel setting with an application to portfolio allocation %A Carlton, Michael Anthony %Y Wooldridge, Jeffrey M. %K Methodology %K Net Worth and Assets %X Several papers use subjective survival probabilities as a measure of mortality risk in studying economic behavior. The first chapter "Wealth Holdings, Asset Allocation and Mortality: A Test of the Information Content of Subjective Survival Probabilities" studies whether subjective survival probability measures contain any additional information that can explain differential wealth holdings and asset allocation among households. We find some evidence that survival probabilities can explain differences in household wealth holding and allocation once we control for other factors that affect decision-making. We also find that the estimated impact of subjective survival is sensitive to the inclusion of reported survival probabilities of one. Some fractional response variables, like the proportion of financial wealth allocated across multiple assets, must satisfy an adding up restriction. In the second chapter "A Model for Multivariate Fractional Responses with an Application to Asset Allocation", we develop a twostep procedure where we estimate a model with multiple fractional response variables exploiting the fact that these variables sum to one in each period and are correlated over time. The first step entails estimation of the multivariate fractional responses using the multinomial quasi-likelihood function which explicitly imposes the adding-up restriction and the second step uses the Classical Minimum Distance estimator to account for serial correlation. Many panel data estimators implicitly assume that we have a balanced panel at our disposal. Unfortunately this is rarely the case and dropping observations is an unsatisfactory solution to the problem. Estimation of fractional responses in a panel requires assumptions about the distribution of the unobserved effect and its relationship with observables, which requires special treatment in an unbalanced panel. In the third chapter, "Estimation of a Multivariate Fractional Response Model with Unbalanced Panel Data", we extend the approach in Wooldridge (2010) to the case of multiple fractional responses and apply this to unbalanced panel data on the allocation of financial wealth across several assets. %I Michigan State University %V 3558362 %P 131 %8 2013 %G English %9 Ph.D. %M 1348915867 %4 Economics %$ 69226 %! Multivariate fractional response models in a panel setting with an application to portfolio allocation %0 Report %D 2013 %T New Evidence on Self-Employment Transitions Among Older Americans with Career Jobs %A Kevin E. Cahill %A Glandrea, Michael D. %A Joseph F. Quinn %K Employment and Labor Force %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X How have post-career transitions into and out of self-employment been impacted by the Great Recession? Research from the 1990s and 2000s has shown that the prevalence of self employment increases substantially later in life, partly because self employment provides older workers with opportunities and flexibility not found in wage-and-salary jobs. Post-career transitions into and out of self employment have also been identified as an important pathway to retirement among older Americans. This paper examines post-career self-employment transitions during the recent recession that began in late 2007 and during the ensuing lackluster recovery. We utilize the Health and Retirement Study (HRS), a nationally-representative longitudinal dataset of older Americans, to investigate the role of self-employment in the retirement transitions of HRS Core respondents over nearly two decades, from 1992 to 2010, with particular emphasis on the most recent years. We find that post-career transitions into and out of self employment remain common in the face of the Great Recession, and that health status, occupation, and financial variables continue to be important determinants of switches from wage-and-salary career employment to self-employed bridge jobs. The latest evidence confirms that self employment continues to be an important pathway to retirement even during recessionary times. %I Washington, DC, U.S. Bureau of Labor Statistics %G eng %4 Economics of Aging/Partial Retirement/Self Employment/labor Force Participation/retirement planning/great Recession/Bridge Jobs %$ 69292 %0 Report %D 2013 %T Older Adult Debt and Financial Frailty %A Annamaria Lusardi %A Olivia S. Mitchell %K Net Worth and Assets %K Retirement Planning and Satisfaction %X 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. %I Ann Arbor, The University of Michigan %G eng %U http://www.mrrc.isr.umich.edu/dl.cfm?pid=946andtype=102 %4 wealth/Financial planning/financial insecurity/retirement planning %$ 69324 %0 Journal Article %J Research on Aging %D 2013 %T Precautionary Savings Against Health Risks: Evidence From the Health and Retirement Study %A Tansel Yilmazer %A Scharff, R. L. %K Consumption and Savings %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %X The precautionary savings model predicts that households accumulate wealth to self-insure against unexpected declines in future income and unforeseen expenditures. The goals of this study are twofold. First, we investigate whether the near-elderly who face higher health risks save more. Second, we examine the factors that contribute to health risks that the near-elderly face. We use data from the Health and Retirement Study to construct two measures of health risks. Our results do not support the hypothesis that household savings increase with the health risks that they face. Individuals who confront higher health risks in the future are those who are already in fair or poor health status or those who have a health condition such as diabetes or lung disease. Lower earnings and high medical expenditures caused by current poor health status prevent households from accumulating savings for future health adversities. %B Research on Aging %I 36 %V 36 %P 180-206 %G eng %U http://roa.sagepub.com/content/early/2013/01/22/0164027512473487 %N 2 %4 wealth Accumulation/Precautionary Saving/Health Risk Assessment/Health Care Expenditures/Lung Diseases/Diabetes %$ 68940 %R 10.1177/0164027512473487 %0 Journal Article %J Clinical Gerontologist %D 2013 %T Is Psychological Vulnerability Related to the Experience of Fraud in Older Adults? %A Peter A Lichtenberg %A Stickney, Laurie %A Daniel Paulson %K Health Conditions and Status %K Net Worth and Assets %K Other %K Public Policy %X Financial exploitation, and particularly thefts and scams, are increasing at an alarming rate. In this study we (a) determined the national prevalence of older adults who report having been a victim of fraud, (b) created a population-based model for the prediction of fraud, and (c) examined how fraud is experienced by the most psychologically vulnerable older adults. The older adults studied were 4,400 participants in a Health and Retirement Study substudy, the 2008 Leave Behind Questionnaire. The prevalence of fraud across the previous 5 years was 4.5 . Among measures collected in 2002, age, education, and depression were significant predictors of fraud. Financial satisfaction and social-needs fulfillment were measured in 2008 and were significantly related to fraud above and beyond the 2002 predictors. Using depression and social-needs fulfillment to determine the most psychologically vulnerable older adults, we found that fraud prevalence was three times higher (14 ) among those with the highest depression and the lowest social-needs fulfillment than among the rest of the sample (4.1 ; 2 = 20.49; p .001). Clinical gerontologists and other professionals in the field need to be aware of their psychologically vulnerable clients' heightened exposure to financial fraud. %B Clinical Gerontologist %I 36 %V 36 %P 132-146 %G eng %N 2 %4 Financial exploitation/Psychological vulnerability/Scams/Depression/Crime/frail Elderly %$ 69162 %R 10.1080/07317115.2012.749323 %0 Journal Article %J Social security bulletin %D 2013 %T Psychosocial factors and financial literacy %A Murphy, John L. %K Demographics %K Net Worth and Assets %X This study uses data from the Health and Retirement Study (HRS) to analyze the psychological and social variables associated with financial literacy. The HRS is a nationally representative longitudinal survey of individuals older than age 50 and their spouses. An ordinary least squares linear regression analysis explores the relationship between financial literacy and several economic and psychosocial variables. After controlling for earnings, level of education, and other socioeconomic variables in this exploratory study, I find that financial satisfaction and religiosity are correlated with financial literacy. %B Social security bulletin %I 73 %V 73 %P 73-81 %G eng %N 1 %4 Financial literacy/Socioeconomic Status/Religiosity %$ 69174 %0 Journal Article %J Journal of Health Economics %D 2013 %T Recession depression: Mental health effects of the 2008 stock market crash %A Melissa McInerney %A Jennifer M Mellor %A Lauren Hersch Nicholas %K Event History/Life Cycle %K Health Conditions and Status %K Income %K Net Worth and Assets %X Do sudden, large wealth losses affect mental health? We use exogenous variation in the interview dates of the 2008 Health and Retirement Study to assess the impact of large wealth losses on mental health among older U.S. adults. We compare cross-wave changes in wealth and mental health for respondents interviewed before and after the October 2008 stock market crash. We find that the crash reduced wealth and increased feelings of depression and use of antidepressant drugs, and that these effects were largest among respondents with high levels of stock holdings prior to the crash. These results suggest that sudden wealth losses cause immediate declines,in subjective measures of mental health. However, we find no evidence that wealth losses lead to increases in clinically-validated measures of depressive symptoms or indicators of depression. %B Journal of Health Economics %I 32 %V 32 %P 1090-1104 %G eng %N 6 %4 Mental Health/Depression/Health Status/Wealth/Income/Life Events %$ 69356 %0 Journal Article %J PloS one %D 2013 %T Relationships of Disability with Age Among Adults Aged 50 to 85: Evidence from the United States, England and Continental Europe %A Morten Wahrendorf %A Reinhardt, Jan D. %A Johannes Siegrist %K Cross-National %K Disabilities %K ELSA %K Net Worth and Assets %K SHARE %X Objectives: To extend existing research on the US health disadvantage relative to Europe by studying the relationships of disability with age from midlife to old age in the US and four European regions (England/Northern and Western Europe/Southern Europe/Eastern Europe) including their wealth-related differences, using a flexible statistical approach to model the age-functions. Methods: We used data from three studies on aging, with nationally representative samples of adults aged 50 to 85 from 15 countries (N = 48225): the US-American Health and Retirement Study (HRS), the English Longitudinal Study of Ageing (ELSA) and the Survey of Health, Ageing and Retirement in Europe (SHARE). Outcomes were mobility limitations and limitations in instrumental activities of daily living. We applied fractional polynomials of age to determine best fitting functional forms for age on disability in each region, while controlling for socio-demographic characteristics and important risk factors (hypertension, diabetes, obesity, smoking, physical inactivity). Results: Findings showed high levels of disability in the US with small age-related changes between 50 and 85. Levels of disability were generally lower in Eastern Europe, followed by England and Southern Europe and lowest in Northern and Western Europe. In these latter countries age-related increases of disability, though, were steeper than in the US, especially in Eastern and Southern Europe. For all countries and at all ages, disability levels were higher among adults with low wealth compared to those with high wealth, with largest wealth-related differences among those in early old age in the USA. Conclusions: This paper illustrates considerable variations of disability and its relationship with age. It supports the hypothesis that less developed social policies and more pronounced socioeconomic inequalities are related to higher levels of disability and an earlier onset of disability. %B PloS one %I 8 %V 8 %G eng %N 8 %4 ELSA_/SHARE/cross-national comparison/disability/disability/wealth %$ 69196 %R 10.1371/journal.pone.0071893 %0 Journal Article %J Journal of Marriage and Family %D 2013 %T Repartnering Following Divorce: Implications for Older Fathers' Relations With Their Adult Children %A Claire Noël-Miller %K Adult children %K Demographics %K Event History/Life Cycle %K Health Conditions and Status %K Net Worth and Assets %X This study examined the implications of postdivorce fathers' new unions and additional (step)children for two aspects of older fathers' relations with adult children born from a prior relationship: frequency of social contact and fathers' financial transfers. Data from multiple waves of the Health and Retirement Study (N=13,017 observations on 4,997 adult children belonging to 1,917 ever-divorced fathers) were used to estimate multilevel models. The results indicated that divorced fathers who go on to form a new union have weaker relations with adult children from a prior union than their postdivorce counterparts who remain single. This finding partly reflects the detrimental effects of repartnered older fathers' new biological children and stepchildren. There is no difference between older remarried and cohabiting fathers' intergenerational ties. Moreover, fathers' additional biological children and stepchildren have similarly negative effects on fathers' relations with adult children from a previous union. %B Journal of Marriage and Family %I 75 %V 75 %P 697-712 %G eng %N 3 %4 Aging/Cohabitation/Divorce/Financial transfer/Intergenerational contact/Remarriage/stepfamilies %$ 69176 %R 10.1111/jomf.12034 %0 Report %D 2013 %T Savings and Wealth of the Lifetime Rich: Evidence from the UK and US %A Bozio, Antoine %A Carl Emmerson %A Cormac O'Dea %A Tetlow, Gemma %K ELSA %K Net Worth and Assets %X Whether higher lifetime income household do save a larger share of their income is one of the longstanding empirical questions in economics that has been surprisingly difficult to answer. We use both consumption data and a new dataset containing both individual survey data on wealth holdings and administrative data on earnings histories from the UK to examine this question. We find evidence of a positive relationship between savig rates (and wealth accumulation) and levels of permanent income. Our findings are consistent with earlier results from Dynan, Skinner and Zeldes (2004) using consumption data from the US, but somewhat at odds with evidence from the US which has examined retirement wealth and lifetime earnings in the Health and Reirement Study, HRS (Gustman andSteinmeier 1999, Venti and Wise 1998). We present new evidence using more recent HRS data, applying exactly the same methodology as we have used on the UK data, and find broadly the same results as these earlier papers. This suggests that the differences are not solely driven by differences in methodology or time period considered. %I London, Institute for Fiscal Studies %G eng %4 Lifetime Earnings, Savings, Wealth %$ 999999 %0 Thesis %D 2013 %T Three essays in public economics %A Anderson, Michael Throan %Y John Karl Scholz %K Health Conditions and Status %K Methodology %K Net Worth and Assets %K Other %K Public Policy %K Social Security %X The first and second chapters of this dissertation consider household financial decision making. In the first chapter I examine the phenomenon of early claiming for Social Security retirement benefits. Previous work has shown that early claiming, in particular by the primary earner in married couples, is not consistent with household benefit maximization nor is it predicted by models of utility maximization. I show that observed claiming behavior is explained well by a model in which the primary earner chooses when to claim without taking into consideration the effect of the choice on the secondary earner's spousal and survivor benefits. I find that the decrease in the value of household benefits due to early claiming is borne almost entirely by the surviving spouse. In the second chapter, with John Karl Scholz and Ananth Seshadri, we use the insight of a lifecycle model to better understand the factors that affect household retirement savings targets. Two of the most important determinants of savings targets are households' location in the lifetime income distribution and number of children. We measure the deviation of a set of financial guidelines for retirement saving from the optimal asset accumulation implied by the lifecycle model and suggest an alternate savings heuristic that takes into account insights from the lifecycle model. The third chapter applies a novel estimation strategy to measure the benefit of hazardous waste site remediation. In contrast to previous estimates, this method calculates the benefit of site remediation allowing for diminishing marginal utility. Using data on home sales in Cincinnati, Ohio in 2000 I find the median willingness to pay for a one mile increase to the nearest hazardous waste site is $228 per year. This is lower than previous estimates which range from $284 to $1,065 per year. %I The University of Wisconsin - Madison %C Madison, WI %V 3592578 %P 124 %8 2013 %G English %9 Ph.D. %M 1436977212 %4 0438:Environmental economics %$ 999999 %0 Thesis %B Gerontology %D 2013 %T Volunteering among surviving spouses: The impact of volunteer activity on the health of the recently widowed %A Kimberly J. Johnson %Y Jan E Mutchler %K Adult children %K Health Conditions and Status %K Healthcare %K Methodology %K Net Worth and Assets %X Numerous studies link volunteering to positive mental and physical health for older adults, and recent studies have suggested that volunteering may be particularly beneficial for those who are widowed. This research examines the potential of volunteering to buffer participants from stress-related health declines associated with the death of a spouse. Using the Health and Retirement Study (HRS), this research investigates the moderating role of volunteering on the self-rated health and depressive symptoms of recently widowed older adults. Consecutive waves of the HRS are used to identify respondents who experience the death of a spouse or who remain married, and those married or widowed respondents who participate in volunteer work over a two-year period. Waves 1998 through 2004 are used to construct three observation periods: 1998-2000, 2000-2002, and 2002-2004. A series of logistic and negative binomial regression analyses are used to estimate the direct effect and interactive effect of widowed status and volunteer status on self-rated health and depressive symptoms respectively. Results indicate that while volunteering decreases the odds of being in fair or poor health and decreases the expected number of depressive symptoms for volunteers compared with nonvolunteers, volunteering does not buffer recent widows from declines in self-rated health or reduce the risk of more depressive symptoms. The results do not support the idea that volunteering serves as a source of social support for older adults when dealing with the stress of spousal loss. However, the findings do support the idea that participating in volunteering helps older adults remain socially integrated through a meaningful role in their community. %B Gerontology %I University of Massachusetts, Boston %C Boston, MA %V Ph.D. %G English %U https://scholarworks.umb.edu/doctoral_dissertations/114/ %M 1415367855 %4 Aging %$ 69208 %0 Newspaper Article %B U.S. News & World Report %D 2012 %T 6 Ways Spending Changes in Retirement %A Brandon, Emily %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Most people spend less money in retirement than they did while they were working. Retired households spend a median of $31,365 annually, which is about 80% of the $39,945 working households spend, according to a recent Employee Benefit Research Institute analysis of Health and Retirement Study data. Six major ways costs change in retirement are presented. %B U.S. News & World Report %I U.S. News and World Report %C Washington, D.C. %8 Mar 2012 %@ 0041-5537 %G eng %U https://money.usnews.com/money/retirement/articles/2012/03/12/6-ways-spending-changes-in-retirement %4 Money/Household wealth/Retirement planning %$ 69630 %0 Report %D 2012 %T The Changing Causes and Consequences of Not Working Before Age 62 %A Barbara A Butrica %A Nadia S. Karamcheva %K Consumption and Savings %K Disabilities %K Employment and Labor Force %K Net Worth and Assets %K Public Policy %K Social Security %X This study uses the Health and Retirement Study to deepen our understanding of nonworking adults ages 51 to 61 and how they support themselves before qualifying for Social Security benefits. The results show that nonworking adults ages 51 to 61 are a heterogeneous group. A large share is poor, with low incomes and limited wealth. But a sizeable share has low incomes and abundant wealth. These individuals are income poor but asset rich. More than for singles, this phenomenon characterizes nonworking married adults. In general, we find that nonworking married adults are significantly better off than their unmarried counterparts. Many nonworking married adults have working spouses. On average, married adults without earnings have twice the per person income and more than ten times the per person assets of single adults without earnings. Additionally, married adults without earnings are 20-30 percentage points less likely to be poor than single adults without earnings. It is important for policymakers to understand who stops working early and how they support themselves. Nonworkers may be more likely to apply and qualify for Social Security disability and SSI benefits. Also, more than any other group, nonworkers will be adversely impacted by any increases to the early entitlement age. Finally, nonworkers are especially vulnerable in retirement because they are likely to have lower savings, Social Security benefits, and pensions than workers. %B Urban Institute Discussion Paper %I The Urban Institute %C Washington, D.C. %G eng %U https://www.urban.org/sites/default/files/publication/23531/412801-The-Changing-Causes-and-Consequences-of-Not-Working-before-Age-.PDF %4 Social Security/Public Policy/DISABILITY/DISABILITY/Asset accumulation/Saving/labor Force Participation %$ 62864 %0 Journal Article %J Ageing and Society %D 2012 %T Cross-national insights into the relationship between wealth and wellbeing: a comparison between Australia, the United States of America and South Korea %A Kim, Sarang %A K. A. Sargent-Cox %A D. J. French %A Kendig, H. %A Kaarin J. Anstey %K Demographics %K Health Conditions and Status %K Healthcare %K KLoSA %K Methodology %K Net Worth and Assets %X ABSTRACT The positive relationship between wealth and wellbeing has received considerable attention over the last three decades. However, little is known about how the significance of wealth for the health and wellbeing of older adults may vary across societies. Furthermore, researchers tend to focus mainly on income rather than other aspects of financial resources even though older adults often rely on fixed income, particularly after retirement. Using data from the Household, Income and Labour Dynamics in Australia (HILDA) survey (N=1,431), the Health and Retirement Study (HRS) in the United States of America (USA; N=4,687), and the Korean Longitudinal Study of Ageing (KLoSA; N=5,447), this exploratory cross-national study examined the relationship between wealth satisfaction and objective wealth and wellbeing (measured as self-rated health and life satisfaction) among older Australians, Americans and Koreans (50 years). Regression analyses showed that wealth satisfaction was associated with wellbeing over and above monetary wealth in all three countries. The relationship between monetary wealth and self-rated health was larger for the US than Australian and Korean samples, while the additional contribution of wealth satisfaction to life satisfaction was larger for the Korean than the Australian and US samples. These findings are discussed in terms of the cultural and economic differences between these countries, particularly as they affect older persons. PUBLICATION ABSTRACT %B Ageing and Society %I 32 %V 32 %P 41 %G eng %U http://proquest.umi.com.proxy.lib.umich.edu/pqdweb?did=2529607071andFmt=7andclientId=17822andRQT=309andVName=PQD %N 1 %4 Wealth/Comparative analysis/Quality of life/Older people/Gerontology %$ 62791 %0 Thesis %D 2012 %T Determinants of the retirement assets and the amount in stock within retirement assets: Evidence from the Survey of Consumer Finances and the Health and Retirement Study %A Ting-Ying Yang %A Feinberg, Richard A. %Y DeVaney, Sharon A. %K Health Conditions and Status %K Methodology %K Net Worth and Assets %K Other %K Pensions %K Retirement Planning and Satisfaction %X The purpose of this research was to investigate the determinants of the retirement assets held in Individual Retirement Accounts, Keogh accounts, and current and future pensions. A second purpose was to investigate the determinants of the amount in stock within those retirement assets. Building upon the theory of human capital, the theory of planned behavior, and the bargaining power model, this study proposed that human capital, attitudes related to finances, and the relative bargaining power of the spouse would influence an individual's retirement assets and the amount in stocks within the retirement assets. Using data from the Survey of Consumer Finances, Study 1 explored the relationship between the three proposed domains and the amount in retirement assets and the amount in stock within the retirement assets. In Study 2, the relationship between the proposed domains was examined using similar variables but with a relatively older sample (e.g., the Health and Retirement Study). The results of both studies supported the theory of human capital and the theory of health capital. Those who had higher education and those who had better health were more likely to have more in retirement assets, and they have more in the amount of stock within retirement assets. Those who saved regularly and were more likely to take risk when saving and investing had more retirement assets and they have more in the amount of stock within retirement assets. The results on the influence of the spouse on retirement assets and the amount in stock within retirement assets showed some support for the bargaining power model. The retirement assets and the amount in stocks within retirement assets were influenced by the spouse. Age, education, working status of the spouse, and who was the more financial knowledgeable person among the two would influence the retirement assets and the amount in stock within retirement assets of the household head. The results of the study supported the existing literature on human capital and health capital. There was some support for the bargaining power model. The results suggest that educators and financial advisors should encourage couples to discuss their plans about saving for retirement with each other and their advisors. However, many people will be single during some or all of their retirement so individual plans for retirement savings should also be carefully developed. This is an important role for educators and financial advisors. However, older adults with fewer resources (e.g. education, employer-sponsored pension plans) will continue to need the support of Social Security. %I Purdue University %C West Lafayette, IN %V Ph.D. %G English %M 1238327087 %4 retirement planning %$ 69802 %0 Journal Article %J International Journal of Manpower %D 2012 %T Do discriminatory attitudes to older workers at work affect their retirement intentions? %A Pierre-Jean, Messe %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Women and Minorities %X Purpose - The purpose of this paper is to investigate whether employers' attitudes towards older workers, especially regarding promotions, really affect their retirement intentions, distinguishing between men and women. Design/methodology/approach - First, the author uses the 1992 wave of the Health and Retirement Study to estimate, through a Fields decomposition, the relative contribution of the feeling of an older worker to be discriminated against regarding promotions; and to explain the self-reported probability to work full time after 62, decomposing by gender. Second, using the two first waves of HRS, the author removes any bias due to time-constant unobserved heterogeneity, to test whether the individual feeling of being passed over for promotion may be misreported, owing to a strong preference for leisure. Finally, the author examines the effect of a change in this variable over time on the intentions to exit early. Findings - The Fields decomposition shows that feeling passed over for promotion plays a non-negligible role to predict retirement plans but only for women. In addition, using panel data allows a misreporting bias to be exhibited that may lead to underestimating of the negative effect of discriminatory practices towards older workers on their retirement plans. Lastly, an increase between 1992 and 1994 in the age-discrimination towards older workers encouraged women to leave their job early, while it had no effect on retirement plans of men. Practical implications - Empirical results put forward the idea that retirement intentions may differ across gender, owing to the different nature of the employer-employee relation. While for men, this relation is characterized by delayed-payment arrangements signed ex ante with the employer, as already shown by Adams, it is not true for women. Consequently, the age-based preference of employers for promotion, leading to a lower probability of promotion for older workers, is treated by men as a consequence of ex ante arrangements and does not affect their retirement plans. However, women can attribute such attitudes of their employer to a kind of blatant discrimination, reducing therefore their attachment to their job. Originality/value - The paper presents a longitudinal approach towards the determinants of retirement intentions that allows the unobserved heterogeneity constant over time to be removed and to estimate to what extent the feeling of being passed over for promotion may be attributed, for each gender, to some arrangements signed ex ante with the employer. %B International Journal of Manpower %I 33 %V 33 %P 405-423 %G eng %N 4 %4 Business And Economics/Labor And Industrial Relations/retirement planning/labor force participation/Discrimination/older workers/women %$ 69522 %R 10.1108/01437721211243769 %0 Journal Article %J Journal of Human Resources %D 2012 %T Does stock market performance influence retirement intentions? %A Gopi Shah Goda %A John B. Shoven %A Sita Nataraj Slavov %K Methodology %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X Media reports predicted that the stock market decline in October 2008 would cause changes in retirement intentions, due to declines in retirement assets. We use panel data from the Health and Retirement Study to investigate the relationship between stock market performance and retirement intentions during 1998-2008, a period that includes the recent crisis. While we find a weak negative correlation between stock returns and retirement intentions, further investigation suggests that this relationship is not driven by wealth shocks brought about by stock market fluctuations, but by other factors that are correlated with both the stock market and retirement intentions. PUBLICATION ABSTRACT %B Journal of Human Resources %I 47 %V 47 %P 1055-1081 %G eng %N 4 %4 great Recession/stock market/retirement planning/Rates of return/Correlation analysis/Securities markets/Securities markets/Retirement %$ 69730 %R 10.3368/jhr.47.4.1055 %0 Thesis %D 2012 %T Dynamic Models of Labor Supply and Retirement %A Fan, Xiaodong %Y John Kennan %K Employment and Labor Force %K Methodology %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %K Social Security %X This dissertation contains three separate essays on the dynamic models of labor supply and retirement. The first essay documents "sharp retirement"--retirement accompanied by a discontinuous decline in labor supply--across three data sets, which previous literature found difficult to explain. I propose and estimate a life-cycle labor supply model with habit persistence wherein sharp retirement can be explained by workers quitting "cold turkey." In much the same way that one might quit smoking, workers with accumulated "working habit" exit the labor force with a pronounced, discontinuous decline in labor supply. The working habit model is consistent with the data, where workers reduce yearly labor supply by scaling back more in hours worked per week (over 50% reduction) than in weeks worked per year (20% reduction). The fixed costs approach, which has been the standard model used to understand sharp retirement, cannot explain these trends. After estimating the model, counterfactuals show that reducing Social Security benefits by 20% causes individuals work an additional 8.6 months. Individuals choosing sharp retirement respond mostly on the extensive margin by delaying retirement eight months, while individuals choosing smooth retirement respond mostly on the intensive margin by increasing yearly labor supply and delaying retirement only one month. The second essay develops and estimates a Ben-Porath human capital model in which individuals make decisions on consumption, human capital investment, labor supply, and retirement. The model allows both an endogenous wage process (which is typically assumed exogenous in the retirement literature) and an endogenous retirement decision (which is typically assumed exogenous in the human capital literature). This integration is important to obtain unbiased estimates, which are critical for most counterfactual analysis. For instance, when evaluating the effect of increasing the Social Security Normal Retirement Age (NRA) on workers' labor supply and retirement decisions, not only does one have to consider how the policy change affects the retirement decision directly, one also needs to consider how it affects the wage process and therefore affects retirement indirectly. We estimate the model using the Method of Simulated Moments to match the life-cycle profiles of wages and hours from the PSID data. Counterfactuals of delaying NRA and removing Social Security earnings test are conducted. We find significant increases in one individual's human capital investment at old ages, which leads to over 20% increase in the wage profile near retirement. Finally, the third essay tests for asymmetric employer learning in the labor market using a three-period model with a match component of wages. When a worker makes her quit/stay decision in a labor market with three periods, she must consider the signaling effect of her decision in subsequent periods. This breaks down some implications derived from two-period models, which are mostly used in the empirical literature. The unconditional quit rate is not necessarily negatively connected with ability in this three-period asymmetric learning model. I suggest two alternative hypothesis tests for asymmetric employer learning in the model. The first test scrutinizes the negative relationship between conditional quit rates and abilities. The second test examines the evolution of weighted average within-group ability variation. Under this model, the variation should decrease over one worker's career history due to sorting on ability. I use the NLSY79 Work-History data and find evidence of asymmetric employer learning from these tests. %I The University of Wisconsin - Madison %V 3524349 %P 113 %8 2012 %G English %9 Ph.D. %M 1080789429 %4 normal retirement age %$ 69244 %! Dynamic Models of Labor Supply and Retirement %0 Thesis %D 2012 %T Essays in Dynamic Macroeconomic Policy %A Shourideh, Ali %K Event History/Life Cycle %K Methodology %K Net Worth and Assets %K Other %K Pensions %K Public Policy %X In this dissertation, we study optimal macroeconomic policy in dynamic environments. In Chapter 1, we focus on optimal tax policies in environments with idiosyncratic capital income risk. We develop a model in which entrepreneurs are subject to idiosyncratic shocks to their capital income. Shocks to capital income have two components: (1) a component that is known to the entrepreneur at the time of investment, (2) a residual component that is realized after investment. This creates two types of incentive problems: a hidden type problem and a hidden action problem. We show that, absent private markets for insurance of idiosyncratic risk, entrepreneurial and non-entrepreneurial capital income should be taxed differently. Moreover, the government should subsidize non-entrepreneurial capital income when the known and lowest value. Furthermore, for a wide variety of distributions, the optimal tax schedule is progressive with respect to entrepreneurial capital income. Finally, the results regarding taxation of entrepreneurial income depend on the extent to which incentives and insurance are provided by private contracts. In particular, private contracts can approximately implement the efficient allocation if convertible securities are available. The prevalence of these securities in venture capital contracts suggest that the forces identified here are important in practice. In Chapter 2, we study optimal intergenerational transmission of consumption and wealth with endogenous fertility. We use an extended Barro-Becker model of endogenous fertility, in which parents are heterogeneous in their labor productivity, to study the efficient degree of consumption inequality in the long run when parents productivity is private information. We show that a feature of the informationally constrained optimal insurance contract is that there is a stationary distribution over per capita continuation utilities, i.e. there is an efficient amount of long run inequality. This contrasts with much of the earlier literature on dynamic contracting where "immiseration'" occurs. Further, the model has interesting and novel implications for the policies that can be used to implement the efficient allocation. Two examples of this are: (1) estate taxes are positive and (2) there are positive taxes on family size. In Chapter 3, we focus on optimal design of pension systems in providing incentives for efficient retirement. We study lifecycle environments with active intensive and extensive labor margins. First, we analytically characterize Pareto efficient policies when the main tension is between redistribution and provision of incentives: while it may be more efficient to have highly productive individuals work more and retire older, earlier retirement may be needed to give them incentives to fully realize their productivity when they work. We show that, under plausible conditions, efficient retirement ages increase in lifetime earnings. We also show that this pattern is implemented by pension benefits that not only depend on the age of retirement but are designed to be actuarially unfair. Second, using individual earnings and retirement data for the U.S. as well as intensive and extensive labor elasticities, we calibrate policy models to simulate robust implications: it is efficient for individuals with higher lifetime earning to retire (i) older than they do in the data and (ii) older than their less productive peers, in sharp contrast to the pattern observed in the data. In Chapter 4, we focus on optimal policies in remedying problems in secondary loan markets. Loan originators often securitize some loans in secondary loan markets and hold on to others. New issuances in such secondary markets collapse abruptly on occasion, typically when collateral values used to secure the underlying loans fall and these collapses are viewed by policymakers as inefficient. We develop a dynamic adverse selection model in which small reductions in that a variety of policies intended to remedy market inefficiencies do not do so. %I University of Minnesota %C Minneapolis, MN %V Ph.D. %G English %U https://hdl.handle.net/11299/130295 %M 1027141201 %4 Economics %$ 69250 %0 Thesis %D 2012 %T Essays on family demography, household finance, and economics of the family %A Fenaba R. Addo %Y Sassler, Sharon %K Adult children %K Demographics %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Public Policy %K Women and Minorities %X This dissertation examines the intersection of financial resources, family demography and economic well-being of American households at transitional periods in the life course. Changes in union formation, the demographic composition of the population, and family structure since the latter part of the twentieth century have challenged existing theories on household formation, individual decision-making, and economic well-being (Bumpass, 1990). With the increase in woman's labor force participation, the rise of cohabitation, pre-marital childbirth, and single-parent households, conventional models used to explain recent trends in marriage market dynamics, intra-household resource allocation, and wealth inequality are continuously tested, challenged, and revamped to keep pace with a society in a current state of demographic and economic flux. Chapter one focuses on early and young adulthood and the role of consumer and education loan debt in transitioning into coresidential relationships using a sample of youth coming of age at the turn of the twenty-first century and during a period of economic expansion, increased college enrollment and growing socioeconomic divide in marital patterns in the United States. Results suggest total debt amount is associated with cohabitation, increasing the odds of cohabitation over marriage and remaining single for both women and men. First marriage is positively associated with greater educational attainment for this cohort of young adults, but women with education loan debt are more likely to delay marrying and cohabit first. Chapter two (co-authored with Daniel T. Lichter) addresses the racial wealth gap by exploring the relationship between marriage and marital histories on wealth accumulation of older Black and White women. Marital and relationship histories are strongly associated with the wealth accumulation process. Women who marry and stay married accumulated levels of wealth that exceeded those of other women with disrupted family lives. The marriage-wealth nexus is sensitive to a women's position in the wealth distribution, and decomposition analyses highlight the non-trivial role of racial disparities in marital histories in accounting for the racial wealth gap. The third and final chapter uses seven waves of individual-level data from the Health and Retirement Survey from 1998-2008 to analyze whether there is a causal effect of being an informal basic needs or financial caregiver to an aging parent on one's health outcomes (self-assessed health and depression) and health behaviors (exercise and smoking). The results suggest a positive effect on depressive symptoms of basic needs caregiving for unmarried adult children, and that they may be selecting into that role because of their poor health. Manifestations of caregiving in future periods include, basic needs caregiving increasing the probability of smoking for married women and financial caregiving increases depressive symptoms for unmarried men. These findings suggest that the financial costs of caregiving can influence adult children's health outcomes, in particular for those not currently in a marital union. %I Cornell University %C Ithaca, NY %V Ph.D. %P 141 %G eng %U https://ecommons.cornell.edu/handle/1813/31034 %M prod.academic_MSTAR_1115315005 %4 socioeconomic Differences %0 Thesis %D 2012 %T Essays on human capital, expectations and behaviors %A Jia, Man %Y Dickens, William T. %K Demographics %K Expectations %K Health Conditions and Status %K Net Worth and Assets %K Risk Taking %X Chapter 1: While previous theoretical analysis suggests that racial differences in death rates might play an important role in explaining the black-white education gap in the U.S., there is little empirical research to test this implication. This paper estimates the extent to which differences in expected mortality risks prior to entering college can explain differences in adult educational attainment in the 2000s, using data from the 1997 National Longitudinal Survey of Youth (NLSY). This study finds that the impact of mortality is not as important as suggested by prior research. Specifically, of the total black-white education gap (roughly 1.12 schooling years), only about 0.05 years or less can be attributed to differences in mortality expectations. As this study confirms, the role of self-reported mortality expectations in explaining black-white education gap is small, and the impacts of death expectations from actual death rates on education are statistically insignificant for reference groups. Chapter 2: The second chapter examines whether individuals are likely to alter personal health-related behaviors once they increase their subjective longevity expectations. To determine if there is a relationship between health behaviors and longevity beliefs, I test one of implications of the Cutler-Glaeser (2009) smoking decision model, which suggests that nonsmokers whose expected survival probabilities have increased are unlikely to start smoking. This study uses data from the Health and Retirement Study (HRS), which is conducted every two years, from 1992 to 2010 (Waves 1-10). Specifically, the HRS data show that a certain share (2.13%) of nonsmokers at Wave t-1 whose subjective expected longevity beliefs increased across two waves did start smoking at Wave t. This small percentage is close to the fraction of new smokers who have steady or decreased survival beliefs (1.99% and 2.19%, respectively). This finding also holds true for other behaviors including heavy drinking, obesity, and physical inactivity. Thus, the findings I present based on the HRS data contrasts with the Cutler-Glaeser model. Chapter 3: Using scores from the Armed Forces Qualification Test (AFQT), Herrnstein and Murray (1994) reported that intelligence can be a powerful predictor of a range of outcomes related to social behaviors (e.g., incarceration, marriage, out-of-wedlock birth, low birth weight and poverty). In contrast, a recent study found that measured intelligence using the same AFQT scores plays a considerably smaller role on an important socioeconomic indicator, namely, hourly wages as measured from 2000 to 2010. My third paper attempts to replicate the Herrnstein and Murray study using a different data set, the 1997 National Longitudinal Survey of Youth to look into several behaviorally-related social outcomes. The main finding is that, in general, the role of AFQT scores in predicting social behaviors has not substantially changed over the last 20 years. I provide a few possible explanations for this finding. %I Northeastern University %C Boston, MA %V Ph.D. %G English %U https://repository.library.northeastern.edu/files/neu:1044 %M 1238265098 %4 Intelligence %$ 69808 %0 Thesis %D 2012 %T Financial and health security in old age: Three essays %A Diebold, Jeffrey %Y John C. Scott %K Health Conditions and Status %K Healthcare %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X This dissertation is composed of three essays that examine issues and policies related to the well-being of the elderly in the United States. Using a randomized control design, I demonstrate the relative strength of incentives structured as a credit as opposed to an economically equivalent deduction within the framework of a retirement-based annuitization decision. Next, I exploit the natural experiment provided by the establishment of Medicare Part D in 2006 to evaluate health-related outcomes affected by this policy change. I provide evidence that Medicare Part D resulted in a number of positive health-related outcomes among those Medicare beneficiaries without prescription drug coverage prior to enrolling in Part D. Finally, I test whether the financially literate are more likely to make decisions that minimize the risks to their financial security. The results from this analysis are decidedly mixed. Financially literate individuals do not, necessarily make better financial and investment related decisions but appear more active in the decision-making process. %I The University of North Carolina at Chapel Hill %C Chapel Hill, NC %V Ph.D. %G English %M 1024433376 %4 retirement planning %$ 69230 %R 10.17615/vcb9-mz77 %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 Report %D 2012 %T Financial Sophistication in the Older Population %A Annamaria Lusardi %A Olivia S. Mitchell %A Vilsa Curto %K Consumption and Savings %K Employment and Labor Force %K Event History/Life Cycle %K Net Worth and Assets %K Other %K Public Policy %K Women and Minorities %X 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. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %4 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 %$ 62868 %R 10.3386/w17863 %0 Journal Article %J The Journal of Consumer Affairs %D 2012 %T Health Shocks, Out-of-Pocket Medical Expenses and Consumer Debt Among Middle-Aged and Older Americans %A Hyungsoo Kim %A Yoon, Wonah %A Karen A. Zurlo %K Consumption and Savings %K Demographics %K Healthcare %K Net Worth and Assets %X We examine two important issues related to health and financial burden in middle-aged and older Americans: (1) whether or not new health events affect a consumer's unsecured debt, and (2) to what extent the associated out-of-pocket medical expenses (OOP) contribute to unsecured debt. We use six biennial waves (1998, 2000, 2002, 2004, 2006 and 2008) from the Health and Retirement Study (HRS). We estimated fixed effects models and conducted mediation analyses. We find that new health events affect the accumulation of unsecured debt. Our estimates suggest that new health events increase unsecured debt by 6.3 ( 230) to 9.3 ( 339); approximately 20 of the increase in unsecured consumer debt comes from OOP when experiencing new health events. New severe health events increase debt for the 50-64 age group, but do not increase it for the 65 group. PUBLICATION ABSTRACT %B The Journal of Consumer Affairs %I 46 %V 46 %P 357-380 %G eng %N 3 %4 Health care expenditures/Consumer credit/Middle age/Older people/Personal finance/Investment analysis and personal finance/Experiment/theoretical treatment/Out of pocket costs %$ 69682 %R 10.1111/j.1745-6606.2012.01236.x %0 Journal Article %J Chicago Fed Letter %D 2012 %T How do the risks of living long and facing high medical expenses affect the elderly's saving behavior? %A Mariacristina De Nardi %A Eric French %A John Bailey Jones %K Adult children %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Although the elderly have a lot of wealth, people still do not fully understand their patterns of saving behavior. Many elderly individuals keep large amounts of wealth even as they near the ends of their lives. Furthermore, as one study shows, income-rich households are especially frugal. Among the motivations for saving are the risks of living long and having high medical expenses in old age. In recent research, the authors quantify the importance of forces by estimating and simulating a rich model of saving behavior. Life spans vary greatly in both predictable and unpredictable ways. Using mortality rates estimated from the AHEAD, they find that rich people, women, and healthy people live much longer than their poor, male, and sick counterparts. The risk of living far past one's expected life span is large and, under incomplete annuitization, a potentially important reason why so many elderly people run down their assets so slowly. %B Chicago Fed Letter %I 294 %V 294 %P 1-4 %G eng %U https://www.chicagofed.org/publications/chicago-fed-letter/2012/january-294 %4 transfers/saving behavior/wealth/retirement planning/mortality %$ 69536 %0 Report %D 2012 %T The Interplay of Wealth, Retirement Decisions, Policy and Economic Shocks %A John Karl Scholz %A Ananth Seshadri %K Consumption and Savings %K Demographics %K Event History/Life Cycle %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Social Security %X We develop a model of health investments and consumption over the life cycle where health affects longevity, provides flow utility, and retirement is endogenous. We develop a rich, numerical life-cycle model to study the complex interrelationship between health and wealth and the age of retirement. The decision to retire depends on a number of factors including earnings and health shocks, demographic characteristics, preferences, pensions, and social security. We incorporate these features in a computational model of optimal wealth and retirement decisions, solving the model household-by-household using data from the HRS. We use the model to study how workers would respond to an increase in the early eligibility age of retirement (EEA), and to what extent will the bad economy alter retirement plans. We find that increasing the EEA results in sizeable responses to the age of retirement but does not affect health outcomes very much. A 20 percent reduction in wealth induces households to delay retirement by one year, on average, with poor households being relatively unaffected. %I Ann Arbor, The University of Michigan %G eng %U http://www.mrrc.isr.umich.edu/publications/publications_download.cfm?pid=860 %4 life Cycle/health investments/Consumption/retirement planning/health Shocks/wealth/social Security/Demographic aspects %$ 69834 %0 Journal Article %J Pensions: An International Journal %D 2012 %T Investment Choice and Savings in Defined Contribution Pensions %A Li, Zhe %K Consumption and Savings %K Event History/Life Cycle %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This article presents econometric evidence from Health and Retirement Study on the role that investment choice plays in the participants' saving levels in the defined contribution (DC) pensions. I distinguish the effect of unconstrained investment choice from the one constrained in company stocks. My preferred estimates indicate that participants with investment choice contribute over three percentage points more of their salary into the DC plan than people without choice, and people constrained in company stocks contribute about three percentage points less in their retirement saving account. %B Pensions: An International Journal %I 17 %V 17 %P 25-35 %G eng %U URL:http://www.palgrave-journals.com/pm/archive/index.html Publisher's URL %N 1 %4 Intertemporal Consumer Choice/Life Cycle Models and Saving/Investment/Retirement/Retirement Policies/retirement Saving %$ 69444 %0 Report %D 2012 %T Investment Decisions in Retirement: The Role of Subjective Expectations %A Marco Angrisani %A Michael D Hurd %A Erik Meijer %K Net Worth and Assets %K Pensions %X The rapid transition from defined benefit (DB) pension plans to defined contribution (DC) plans has a potential benefit of offering pension holders greater control over how their pension accumulations are invested. If pension holders are willing to take some risk, investments in the stock market could increase their economic preparation for retirement, and, indeed, economic theory as well as the typical advice of financial advisors calls for stock market investments. Yet, the rate of stock holding is much below what theory suggests it should be, undoing any benefit associated with the greater control coming from DC plans. The leading explanations for this under-investing include excessive risk aversion, costs of entry, and misperceptions about possible returns in the stock market. We show that excessive risk aversion is not able to account for the low fraction of stock holding. However, a model with heterogeneous subjective expectations about stock market returns is able to account for low stock market participation, and tracks the share of risky assets conditional on participation reasonably well. Based on the model with subjective expectations, we estimate a welfare loss of up to 12 compared to investment under rational expectations, if actual returns follow the same distribution as in the past 50 years. The policy implication is that there is considerable scope for welfare improvement as a result of consumer education regarding stock market returns. However, the welfare loss is much smaller if individuals are not very risk averse or if actual returns follow the same distribution as in the past 10 years %I Ann Arbor, The University of Michigan %G eng %U http://www.mrrc.isr.umich.edu/publications/publications_download.cfm?pid=865 %4 pension Plans/defined benefit plans/defined contribution pension plans/investment Decisions/investment Decisions/stock market %$ 69830 %0 Journal Article %J Journal of Personal Finance %D 2012 %T Market Performance And The Timing Of Retirement %A Yao, Rui %A Park, Eric %K Consumption and Savings %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This study is the first to utilize nine interview waves of the Health and Retirement Study and multilevel discrete-time survival analysis to investigate the effect of market returns on individual elective retirement decisions. Individuals who retire at a market peak have an increased risk of shortening the longevity of their retirement income. Unfortunately, market returns were found to have a significant positive effect on the probability of retirement. Researchers, employers, financial educators and financial practitioners should help pre-retirees overcome the stock market's influence on their decision-making to avoid the negative effect of market sequencing on their retirement wealth. PUBLICATION ABSTRACT %B Journal of Personal Finance %I 11 %V 11 %P 10-48 %G eng %U https://ssrn.com/abstract=2740054 %N 1 %4 personal finance/methodology/Banking And Finance/Retirement planning/market returns/retirement wealth/stock market %$ 69540 %0 Journal Article %J Journal of Urban Economics %D 2012 %T Medicaid and the housing and asset decisions of the elderly: Evidence from estate recovery programs %A Nadia Greenhalgh-Stanley %K Adult children %K Housing %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Public Policy %X I examine the impact of Medicaid on elderly housing and portfolio decisions by using recent state-by-calendar-year level variation in the Medicaid treatment of owner-occupied housing assets from the adoption of Medicaid estate recovery programs. Prior to the adoption of these programs, the house, which represents the most important non-pension asset to the elderly, was exempt from determining Medicaid eligibility and served as both a place of residence and a store of wealth. Adoption of estate recovery programs changed the owner-occupied housing safety net by making the house eligible for recovery by the government, which increased the implicit tax of holding owner-occupied housing. Using data from 1993 to 2004 in the Health and Retirement Study on elderly individuals, I find that state adoption of estate recovery programs makes the elderly decrease homeownership by 4.6 , decrease home equity by 15 , and also decrease the housing share of the elderly wealth portfolio. State adoption of these programs results in elderly baseline homeowners being 33 less likely to own their homes at death and more likely to use a trust as a substitute to housing in order to preserve assets and carry out bequest motives at death. PUBLICATION ABSTRACT %B Journal of Urban Economics %I 72 %V 72 %P 210-224 %G eng %N 2-3 %4 Medicaid/housing/household wealth/Social policy/Business And Economics/Public Policy/estate Tax/Bequest Motives/assets/estate recovery %$ 69790 %R 10.1016/j.jue.2012.05.005 %0 Report %D 2012 %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 Methodology %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X A review of the literature suggests that when pension values are measured by the wealth equivalent of promised DB pension benefits and DC 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 (HRS) for respondents in their early fifties suggest that pension wealth is about 86 percent 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 to 69, pension incomes are about 56 percent as valuable as incomes from Social Security. Our empirical analysis uses data from the Health and Retirement Study to examine the reasons for these differences in the contributions of pensions as measured in income and wealth data. A number of factors cause the contribution of pensions to be understated in retirement income data, especially data from the CPS. One factor is a difference in methodology between surveys affecting what is included in pension income, especially in the CPS, which ignores irregular payments from pensions. In CPS data on incomes of those ages 64 to 69 in 2006, pension values are 59 percent of the value of Social Security. For the same cohort, in HRS data, the pension value is 67 percent of the value of Social Security benefits. Some pension wealth disappears at retirement because respondents change their pension into other forms that are not counted as pension income in surveys of income. Altogether, 16 percent of pension wealth is transformed into some other form at the time of disposition. For those who had a defined benefit pension just before termination, the dominant plan type for current retirees, at termination 12 percent of the benefit was transformed into a state that would not count as pension income after retirement. For those who receive benefits soon after termination, there is a 3.5 percent reduction in DB pension value at termination compared to the year before termination. One reason may be the form of annuitization that is chosen. 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. %B MRDRC Working Paper %I Michigan Retirement and Disability Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/pubs/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-2/ %4 pension Plans/retirement planning/pension Wealth/Defined benefit plans/Current Population Survey/pension income %$ 69822 %0 Thesis %D 2012 %T Pensions and Household Saving in The United States %A Chang, Fei-Chien %Y Bruce, Neil %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %K Pensions %K Public Policy %K Social Security %X The goal of this research is to examine the effects of employer-provided pensions and Social Security on household saving in the United States. Current interest has intensified because of increasing concerns about insufficient saving for retirement, a trend in pensions from defined benefit to defined contribution plans, and a projected financial shortfall in Social Security. Specifically, the debate about whether higher pension benefits "crowd out" private saving has come under sharper focus among researchers and policymakers. If there is a full offset effect of pensions on private saving, then policies targeted to raise pension wealth may not necessarily increase overall retirement saving because households will decrease their private wealth accumulation instead. Three methodologies were employed in Chapters 2 through 4 to empirically identify the offset effects using improved data in the Health and Retirement Study (HRS). Chapter 2 presents a cross-sectional analysis in 1992. The findings show a significant but not dollar-for-dollar crowding-out effect for employer-provided defined benefit pensions and little to no offset effect for defined contribution pension and Social Security. To overcome the estimation problems such as unobserved omitted variables and insufficient variation in Social Security wealth when conducting a cross-sectional analysis, I utilize the panel structure of HRS and the recent Social Security reforms to introduce independent variation in pension wealth over time. A panel analysis using HRS data from year 1992, 1998, and 2004 is presented in Chapter 3. The panel analysis shows a statistically significant full offset effect between pensions and private saving in some specifications. Chapter 4 presents the effects of Social Security benefits withheld under the earnings test on household saving. I find evidence for a full offset effect between household saving and benefit withholding under the earnings test for those aged between 62 and normal retirement age and those with higher educational attainment. In summary, this research supports the theory that pensions crowd out private wealth accumulation. %I University of Washington %C United States -- Washington %V Ph.D. %P 98 %G English %U http://search.proquest.com.proxy.lib.umich.edu/docview/1034568586?accountid=14667 %9 3521443 %M 1034568586 %4 Saving %$ 69798 %! Pensions and Household Saving in The United States %0 Report %D 2012 %T Personality Traits and Economic Preparation for Retirement %A Michael D Hurd %A Angela Lee Duckworth %A Susann Rohwedder %A David R Weir %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper assesses the effects of personality traits on economic preparation for retirement, wealth accumulation, and consumption, among persons 66 to 69 years of age. Among the five chief personality traits of neuroticism, extroversion, agreeableness, conscientiousness, and openness, we focus most on conscientiousness. We find levels of adequate economic preparation for retirement ranging from 29 percent to 90 percent and that conscientiousness positively affects the proportion of persons adequately prepared for retirement, while neuroticism negatively affects it. Both consumption and wealth increase with conscientiousness but wealth increases faster, indicating that more conscientious persons save more out of retirement resources. %B MRDRC Working Paper %I Michigan Retirement and Disability Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://ideas.repec.org/p/mrr/papers/wp279.html %4 personality traits/Conscientiousness/Conscientiousness/retirement planning/wealth Accumulation/consumption/wealth %$ 69838 %0 Newspaper Article %B Benefits Selling. Breaking News %D 2012 %T Recession impacted near-retirees housing wealth %A Paula Aven, Gladych %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X Using asset and labor market data from the Health and Retirement Study, the organization examined the population that was just reaching retirement age when the recession hit, those aged 53 to 58 in 2006. %B Benefits Selling. Breaking News %I National Underwriter Company dba Summit Business Media %C New York %8 May 22, 2012 %G eng %U http://search.proquest.com.proxy.lib.umich.edu/docview/1021020587?accountid=14667 %4 great Recession/Social security/Household wealth/Retirement planning %$ 69628 %! Recession impacted near-retirees housing wealth %0 Journal Article %J Research in the Sociology of Work %D 2012 %T Religion and Wealth Across Generations %A Keister, Lisa A. %K Adult children %K Demographics %K Net Worth and Assets %K Women and Minorities %X Purpose -- This chapter explores the relationship between religious affiliation and wealth ownership focusing on generational differences. Methodology -- I use data from the National Longitudinal Survey of Youth and the Health and Retirement Study to create descriptive statistics and regression analyses of the association between religious affiliation in childhood and adulthood for people of two cohorts. Finding -- This chapter shows that there are important patterns by religious affiliation in total net worth, real assets, and asset allocation across generations. My findings are consistent with past work on religion and wealth ownership showing that Jews, mainline Protestants, and white Catholics tend to have higher total wealth than other groups. In addition, I find that black Protestants, Hispanic Catholics, and conservative Protestants tend to have relatively low wealth, consistent with research on religion, race/ethnicity, and wealth. My findings also show that these patterns are relatively robust across generations. Research implications -- The findings are relevant to research on inequality, wealth accumulation and saving, life course processes, and the effect of religion on stratification outcomes. Originality/Value -- This research shows how religious affiliation and wealth are related across generations. Adapted from the source document. %B Research in the Sociology of Work %I 23 %V 23 %P 131-150 %G eng %4 Church Membership/Protestants/Ownership/Catholics/wealth Accumulation/Generational Differences/Hispanics/socioeconomic Differences %$ 69684 %R 10.1108/s0277-2833(2012)0000023009 %0 Thesis %B Human Ecology %D 2012 %T Retirement Consumption Behavior: Evidence from HRS CAMS 2001-2009 %A Chiang, Mei-Fang %Y Montalto, Catherine P. %K Consumption and Savings %K Demographics %K Event History/Life Cycle %K Healthcare %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Recent studies across a number of countries evidence a substantial decline in household consumption expenditure around the time of retirement. This phenomenon, coined as the retirement consumption puzzle, brings a challenge to the traditional life-cycle model. The life-cycle model implies that household consumption should be continuous over time including the transition to retirement, provided that retirement is a foreseeable event. To address the retirement consumption puzzle, this dissertation brings current evidence by carrying out four studies on U.S. household consumption behavior at retirement. Study 1 is a cross-sectional study using the latest available data wave from 2009 HRS CAMS. The main interest is to compare consumption behavior between non-retired and retired households. Based on the life cycle hypothesis, regardless of employment status, households sharing similar socioeconomic characteristics should exhibit similar consumption behavior. The empirical findings, however, show that the consumption behavior between non-retired and retired households is significantly different, holding all other factors constant. Spending for retired households is 8.5% lower than spending for non-retired households. Study 2 is an aggregate-panel study using data from 2001-2009 HRS CAMS. The difference between Study 1 and Study 2 is that Study 2 tracks household consumption behavior over time and investigates whether there is a significant change in consumption pattern after retirement. Fixed-effects analysis is conducted to appropriately account for the effect of individual heterogeneity. The life cycle hypothesis predicts that when retirement is as planned by the household, there is no significant change in consumption after retirement. The fixed-effects regression indicates that there is an insignificant increase of 3% in household consumption after retirement. The discrepancy in the results from Study 1 and Study 2 regarding the retirement consumption puzzle comes from the lack of control of individual heterogeneity in the cross-sectional analysis. Study 3 is a subsamples-panel study. Within the life-cycle framework, if retirement is voluntary and expected, there should be no significant change in household consumption after retirement. However, if the household head is laid-off or experiencing poor health, this household may be forced to be out of the labor market, resulting in early retirement. Because involuntary early retirement reduces the household's lifetime resources, the household must reduce consumption and re-allocate to a new optimal consumption path. As predicted by the life-cycle model, the findings show that households with voluntary retirement have an insignificant increase in household consumption after retirement by 6%. Involuntary-retirement results in a decrease in consumption after retirement by 6-7%. The percentage difference in the household consumption change between these the two groups of households is 11-12% and statistically significant. Accordingly, these findings suggest that household consumption behavior differs by household type (voluntary versus involuntary retirement). These three studies use log consumption as the dependent variable. Alternatively, Study 4 uses consumption growth as the dependent variable to test the retirement consumption puzzle. The regression results provide no evidence of a retirement consumption puzzle, finding an insignificant 3% increase in consumption after retirement. %B Human Ecology %I The Ohio State University %C Columbus, OH %V Ph.D. %8 2012 %G English %U http://rave.ohiolink.edu/etdc/view?acc_num=osu1338247837 %4 life Cycle %$ 69678 %0 Thesis %D 2012 %T Three Essays on the Labor Supply, Savings and Investment Behavior of Older Workers %A Clift, Jack W. %Y Julie M Zissimopoulos %K Employment and Labor Force %K Healthcare %K Methodology %K Net Worth and Assets %K Pensions %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %X In this dissertation, I provide three distinct analyses addressing labor supply, saving and investment behavior of (older) workers, in the context of the incentives and constraints they face due to employer and government policies. In the first paper, I examine labor supply flexibility and its effect on the labor supply decisions of older workers. Previous literature suggests that people would like to reduce hours of work gradually over time as they get older, but do not have the flexibility to do so in their job, and consequently may retire early rather than continue to work high hours at older ages. If greater flexibility allows individuals to stay in the labor force longer, this could increase total labor supply, helping to increase both private resources for retirement and tax revenue to support public programs. Following a sample of older Americans for 16 years from 1992 to 2008, I find that there are noticeable differences in labor outcomes between those who had flexibility over their hours in 1992 and those who were not able to adjust their hours: those with flexibility worked fewer hours in their 50s, but tended to stay in the labor force longer; the major difference between groups occurred when individuals were in their early-mid 60s, at which time those who did not have flexibility in 1992 were much more likely to retire than those with flexibility. This work provides support for the theory that people prefer gradual retirement to more abrupt departures from the labor force, and indicates that flexibility around key retirement ages might have an impact on behavior. The overall effect on total labor supply of providing flexibility at all points of the lifecycle is ambiguous. In the second paper, we examine whether labor supply flexibility affects investment behavior. Individuals can receive higher returns (on average) on their investments if they are willing to bear more risk, which allows people to reach retirement with greater resources (on average) than if they had pursued low-risk strategies; but the fear of suffering big losses discourages people from taking risks. Theoretical work has argued that individuals with flexibility over their labor supply over the lifecycle can bear more risk in their portfolio of investments, as they can increase their labor to offset any losses they might suffer. Using a new survey we fielded in the American Life Panel (ALP), we examine how different measures of labor supply flexibility are related to measures of risk-taking in investments: individual participation in the stock market, and the percentage of an individual's financial wealth held in stocks. We find no evidence that flexibility over number of hours worked per week is related to investments in stocks. We find weak evidence that other flexibility measures--an individual's belief that they would be able to continue to work longer to make up for any negative wealth shocks, and the absence of factors that make it difficult to sustain a job into old age--may be related to greater risk-taking in investments. These results may indicate that flexibility at the extensive margin (ability to extend a career) may be more relevant to investment decision-making than flexibility at the intensive margin (ability to adjust hours). In the third paper, I describe the construction and characteristics of a unique dataset with which I lay the foundations for understanding pension system incentives and how they influence work and savings behavior over the lifecycle. Public pension systems across the developed world are in need of reform, but it is important to understand how the incentives in these systems affect behavior if we are to predict the consequences of different possible reforms. Previous literature has argued that public pensions displace private savings, but with elasticity of less than 1; this suggests that possible reductions in pension benefits through reforms would be partially (but not fully) offset by increases in private saving. Using new retrospective earnings history data for five European countries, in conjunction with linked survey data describing household wealth, I construct a dataset that captures the heterogeneous pension system incentives faced, and labor supply decisions made, at each point in the lifecycle for a large group of European men. My exploratory analysis of this dataset is consistent with the hypotheses that more generous income replacement by pension plans leads to lower private wealth accumulation, and greater reward within the pension system for continued work leads to later retirement. However, these statistical associations admit of plausible alternative explanations; the work documented in this paper cannot provide definitive answers on the incentive effects of pension systems, but provides the groundwork for significant extensions of research in this field, and eventually for detailed policy simulation of pension reform. (Abstract shortened by UMI.) %I The Pardee RAND Graduate School %C Santa Monica, CA %V Ph.D. %G English %U https://www.rand.org/pubs/rgs_dissertations/RGSD305.html %M 1238001335 %4 Public policy %$ 69240 %0 Journal Article %J Demography %D 2012 %T Union Formation in Later Life: Economic Determinants of Cohabitation and Remarriage Among Older Adults %A Jonathan Vespa %K Adult children %K Demographics %K Net Worth and Assets %K Other %X This study builds on Becker's and Oppenheimer's theories of union formation to examine the economic determinants of marriage and cohabitation during older adulthood. Based on the 1998-2006 Health and Retirement Study and a sample of previously married Americans who are at least 50 years old, results show that wealthier older adults, regardless of gender, are more likely to repartner than stay single. Wealth has no discernable effect on the likelihood of remarrying versus cohabiting. Among the oldest men, the positive associations between wealth and repartnering are entirely due to housing assets. Results suggest that Oppenheimer's theory of marriage timing may be more applicable to later-life union formation than Becker's independence hypothesis. Further, economic disadvantage does not appear to characterize later-life cohabitation, unlike cohabitation during young adulthood. These findings help illuminate the union formation process during older adulthood and are timely considering demographic changes reshaping the American population. PUBLICATION ABSTRACT %B Demography %I 49 %V 49 %P 1103 %G eng %U http://proquest.umi.com.proxy.lib.umich.edu/pqdweb?did=2712630701andFmt=7andclientId=17822andRQT=309andVName=PQD %N 3 %4 Remarriage/Older people/Studies/Cohabitation/Demographics/Wealth %$ 69504 %0 Report %D 2012 %T Were They Prepared for Retirement? Financial Status at Advanced Ages in the HRS and AHEAD Cohorts %A James M. Poterba %A Steven F Venti %A David A Wise %K Consumption and Savings %K Employment and Labor Force %K Event History/Life Cycle %K Net Worth and Assets %K Women and Minorities %X Many analysts have considered whether households approaching retirement age have accumulated enough assets to be well prepared for retirement. In this paper, we shift from studying household finances at the start of the retirement period, an ex ante measure of retirement preparation, to studying the asset holdings of households in their last years of life. The analysis is based on Health and Retirement Study with special attention to Asset and Health Dynamics Among the Oldest Old (AHEAD) cohort that was first surveyed in 1993. We consider the level of assets that households hold in the last survey wave preceding their death. We study how assets at the end of life depend on three family status pathways prior to death--(1) original one-person households in 1993, (2) persons in two-person household in 1993 with a deceased spouse in the last year observed, and (3) persons in two-person households in 1993 with the spouse alive when last observed. We find that a substantial fraction of persons die with virtually no financial assets--46.1 percent with less than 10,000--and many of these households also have no housing wealth and rely almost entirely on Social Security benefits for support. In addition this group is disproportionately in poor health. Based on a replacement rate comparison, many of these households may be deemed to have been well-prepared for retirement, in the sense that their income in their final years was not substantially lower than their income in their late 50s or early 60s. Yet with such low asset levels, they would have little capacity to pay for unanticipated needs such as health expenses or other financial shocks or to pay for entertainment, travel, or other activities. This raises a question of whether the replacement ratio is a sufficient statistic for the adequacy of retirement preparation. %I National Bureau of Economic Research %G eng %U URL:http://www.nber.org/papers/w17824.pdf URL %4 Asset accumulation/Personal Finance/Intertemporal Consumer Choice/Life Cycle Models and Saving/Economics of the Elderly/Economics of the Handicapped/Non-labor Market Discrimination %$ 62866 %0 Journal Article %J Journal of Family and Economic Issues %D 2012 %T Who Among the Elderly Owns Stocks? The Role of Cognitive Ability and Bequest Motive %A Eun Jin Kim %A Sherman D. Hanna %A Chatterjee, Swarn %A Lindamood, Suzanne %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Conventional advice is to reduce risky investments as one ages. Such a generalized focus on risk avoidance may be inappropriate for elderly with longer life spans and those with financial goals that extend beyond their lifetime. To better understand risky asset holdings among the elderly, we investigated the effect of cognitive ability and bequest motive on stock ownership and stock purchase. Using the 2004 wave of the Health and Retirement Study, we found that one-third of elderly households held stocks and 36 of those elderly stockowners had recently acquired stocks. The respondent's cognitive ability and bequest motive were strongly related to stock ownership. Among those who owned stock, a bequest motive was positively related to a recent purchase of stocks. PUBLICATION ABSTRACT %B Journal of Family and Economic Issues %I 33 %V 33 %P 338-352 %G eng %U http://search.proquest.com.proxy.lib.umich.edu/docview/1030719840?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004andctx_enc=info:ofi/enc:UTF-8andrfr_id=info:sid/ProQ 3Aabiglobalandrft_val_fmt=info:ofi/fmt:kev:mtx:journalandrft.genre=articl %N 3 %4 Psychology/investment decisions/investment decisions/retirement planning/cognitive ability/stock market/assets %$ 69510 %R 10.1007/s10834-012-9295-2 %0 Report %D 2011 %T Cognitive Aging and Human Capital %A John J McArdle %A Robert J. Willis %K Health Conditions and Status %K Net Worth and Assets %I University of Michigan %G eng %4 human Capital/Cognitive ability/Aging %$ 62830 %0 Thesis %B Family, Consumer and Human Development %D 2011 %T Debt and negative net worth among near-retirees %A Brown, Susan M. E. %Y Lee, Yoon G. %K Adult children %K Methodology %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X Going into retirement, near-retirees are looking at increased debt levels, which can offset any asset accumulations and reduce retirement income. By using data from the 2008 Health and Retirement Study (HRS), this study examines the debt and negative net worth of near-retirees. This study further investigates what factors are associated with the likelihood of holding consumer debt, holding mortgage debt, and holding home equity debt over holding no debt, and what factors are associated with the likelihood of holding negative net worth over holding a high level of net worth among near-retirees. The study sample includes 3,745 individuals between the ages of 51 and 64. The results of the multinomial logistic regression analysis indicate that, all else being equal, human capital factors such as education, physical health problems, and depression symptoms play a significant role in predicting the likelihood of holding debt and negative net worth. In particular, education is positively associated with the likelihood of holding consumer, mortgage, and home equity debt over holding no debt, while it is negatively associated with the likelihood of having negative net worth over having a high level of net worth. Among the socioeconomic characteristics that influence the likelihood of near-retirees holding debt and negative net worth are household income, working in the labor force, and race. In particular, household income positively influences the likelihood of holding mortgage debt over holding no mortgage debt as well as the likelihood of holding home equity debt over holding no home equity debt. However, household income negatively influences the likelihood of having negative net worth over having a higher level of net worth. The findings of this study could help financial educators, financial planners, and policymakers understand the differences in human capital and socioeconomic characteristics of near-retirees who hold some levels of debt over no debt and who hold no net worth or a lower level of net worth over a higher level of net worth. This study concludes that it is important for professionals, consumer educators, and financial planners to provide those who hold higher levels of debt and lower levels of net worth with financial literacy education; therefore, these individuals might be able to attain economic well-being in retirement. %B Family, Consumer and Human Development %I Utah State University %C Logan, UT %V Ph.D. %P 164 %G eng %U https://digitalcommons.usu.edu/cgi/viewcontent.cgi?article=1937&context=etd %N AAT 3453573 %4 Net Worth %$ 69320 %0 Journal Article %J Social Science Research %D 2011 %T The effect of late-life debt use on retirement decisions %A Mann, Allison %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper examines parallel shifts in late life debt use and retirement behaviors. After discussing the conceptual linkages between credit and labor markets, I use data from the 1992 to 2008 waves of the Health and Retirement Study to examine the temporal patterning of retirement and debt behaviors. I rely on the longitudinal structure of the data to estimate the effects of debt accumulation on retirement behaviors, using alternative specifications to identify treatment and control groups. The findings suggest that debt accumulation in later life has a significant effect on decisions to remain in the workforce in later years. PUBLICATION ABSTRACT %B Social Science Research %I 40 %V 40 %P 1623-1637 %G eng %N 6 %4 Retirement/Social identity/Social identity/Wealth/Personal finance %$ 62650 %R https://doi.org/10.1016/j.ssresearch.2011.05.004 %0 Report %D 2011 %T The Effects of the Financial Crisis on Actual and Anticipated Consumption %A Michael D Hurd %A Susann Rohwedder %K Consumption and Savings %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X We studied how households adjust their spending in response to the financial crisis. Based on five waves of data from the Consumption and Activities Mail Survey, we quantified the reduction in total consumption and in specific categories of consumption in the older population at large and by stock ownership, both as a proxy for wealth and to test assumptions about whether stock ownership was associated with different responses. In particular, we compared consumption changes between 2007 and 2009 with consumption changes over prior years. We used panel data on anticipated changes in spending at retirement to quantify the effects of the financial crisis on well- being in retirement via a difference-in-differences approach. %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://mrdrc.isr.umich.edu/pubs/the-effects-of-the-financial-crisis-on-actual-and-anticipated-consumption-2/ %4 Consumption/household spending/household spending/great Recession/retirement planning %$ 62806 %0 Thesis %D 2011 %T Essays in Labor Economics %A McFall, Brooke Helppie %K Health Conditions and Status %K Methodology %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X This dissertation is composed of two essays, both which use data from original survey projects to examine issues related to work choice. The first essay examines the labor supply effects of the wealth losses during the stock market crash of 2008 and 2009. A life-cycle model incorporating both consumption and retirement timing implies that exogenous wealth losses should delay optimal retirement timing. Using data from the Cognitive Economics Study and the Health and Retirement Study, this essay quantifies the wealth losses suffered by older Americans in terms of the additional length of time they would have to work to maintain the pre-crash consumption plan implied by their wealth holdings and expected retirement timing. Using these measures, Tobit regressions and a novel method for reducing the impact of error-ridden observations are used to examine the relationship between this measure of wealth loss and retirement planning. Several potential sources of heterogeneity in individuals' reactions to the crash are also examined. Results imply that wealth losses of 2008 and 2009 are associated with an increase in planned retirement age on the order of a few weeks to a few months for the average older American, but up to several months for some segments of the population. These results are consistent with results of recent studies and the life-cycle model, but stand in contrast to other examinations of wealth shocks on the general population of older Americans. The second essay is a product of the Job Seekers Study. The essay extends Mincer's seminal theory of family migration to allow couples to adjust to migration constraints by living apart, and examine the ways in which new PhD economists adjust to migration constraints imposed on them by their spouses or partners. Both the impact of migration constraints on job outcomes and the impact of job considerations on relationship outcomes are analyzed. The essay finds that migration constraints result in small costs in terms of job outcomes, relative to many existing studies, and that adjustment through living apart is common. These results imply that existing studies may overestimate the job impact of migration constraints. %I University of Michigan %C Ann Arbor, MI %V Ph.D. %P 275 %G eng %4 wealth %$ 62826 %0 Report %D 2011 %T Household Stock Market Beliefs and Learning %A Kezdi, Gabor %A Robert J. Willis %K Consumption and Savings %K Expectations %K Methodology %K Net Worth and Assets %X This paper characterizes heterogeneity of the beliefs of American households about future stock market returns, provides an explanation for that heterogeneity and establishes its relationship to stock holding behavior. We find substantial belief heterogeneity that is puzzling since households can observe the same publicly available information about the stock market. We propose a simple learning model where agents can invest in the acquisition of financial knowledge. Differential incentives to learn about the returns process can explain heterogeneity in beliefs. We check this explanation by using data on beliefs elicited as subjective probabilities and a rich set of other variables from the Health and Retirement Study. Both descriptive statistics and estimated relevant heterogeneity of the structural parameters provide support for our explanation. People with higher lifetime earnings, higher education, higher cognitive abilities, defined contribution as opposed to defined benefit pension plans, for example, possess beliefs that are considerably closer to what historical time series would imply. Our results also suggest that a substantial part of the reduced form relationship between stock holding and household characteristics is due to differences in beliefs. Our methodological contribution is estimating relevant heterogeneity of structural belief parameters from noisy survey answers to probability questions. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %4 Multiple or Simultaneous Equation Models/Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Information, Knowledge, and Uncertainty: General/Information, Knowledge, and Uncertainty: General/Subjective Probabilities/Stock Market %$ 62802 %R 10.3386/w17614 %0 Report %D 2011 %T How Did the Recession of 2007-2009 Affect the Wealth and Retirement of the Near Retirement Age Population in the Health and Retirement Study? %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Demographics %K Employment and Labor Force %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X This paper uses asset and labor market data from the Health and Retirement Study (HRS) to investigate how the recent Great Recession has affected the wealth and retirement of those in the population who were just approaching retirement age at the beginning of the recession, a potentially vulnerable segment of the working age population. The retirement wealth held by those ages 53 to 58 before the onset of the recession in 2006 declined by a relatively modest 2.8 percentage points by 2010. In more normal times, their wealth would have increased over these four years. Members of older cohorts accumulated an additional 5 percent of wealth over the same age span. To be sure, a part of that accumulation was the result of the upside of the housing bubble. The wealth holdings of poorer households were least affected by the recession. Relative losses are greatest for those who initially had the highest wealth when the recession began.The adverse labor market effects of the Great Recession are more modest. Although there is an increase in unemployment, that increase is not mirrored in the rate of flow out of full-time work or partial retirement. All told, the retirement behavior of the Early Boomer cohort looks similar, at least so far, to the behavior observed for members of older cohorts at comparable ages. Very few in the population nearing retirement age have experienced multiple adverse events. Although most of the loss in wealth is due to a fall in the net value of housing, because very few in this cohort have found their housing wealth under water, and housing is the one asset this cohort is not likely to cash in for another decade or two, there is time for their losses in housing wealth to recover. %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://mrdrc.isr.umich.edu/pubs/how-did-the-recession-of-2007-2009-affect-the-wealth-and-retirement-of-the-near-retirement-age-population-in-the-health-and-retirement-study-2/ %4 asset accumulation/labor Force Participation/wealth Accumulation/housing wealth/retirement planning/Great Recession/early boomers %$ 62646 %0 Report %D 2011 %T The Influence of Public Policy on Health, Wealth and Mortality %A John Karl Scholz %A Ananth Seshadri %K Consumption and Savings %K Event History/Life Cycle %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %X In this project we extend an augmented lifecycle model, incorporating a Grossman-style model of health capital, to enhance understanding of factors influencing consumption, wealth and health. We develop three primary results when using the model to explore the effects of stylized versions of Medicare and Social Security on wealth and longevity. First, our model calibration implies consumption and health are complements. As health depreciates with age, households will get less utility from consumption than would be in the case of a lifecycle model that does not endogenize health. Second, it appears that forward-looking households, when confronted by a substantially reduced safety net, will respond by reducing consumption and by reducing their health investment and therefore longevity. Third, there is a potentially important difference between short- and long- run responses to policy. %B Michigan Retirement and Disability Research Center Project %I The University of Michigan %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/projects/the-influence-of-public-policy-on-health-wealth-and-mortality/ %4 life-cycle/health capital/health capital/consumption/Public Policy/household spending/household spending %$ 62811 %0 Journal Article %J Journal of Sociology and Social Welfare %D 2011 %T Net Worth Accumulation by Different Quintiles of Older Adults Approaching Retirement Age and 10 Years Later %A Martha N. Ozawa %A Yeo, Yeong H. %K Demographics %K Health Conditions and Status %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %X The shift in responsibility for income security from the government to individuals makes the accumulation of net worth a vital issue. We investigated the rate of net worth accumulation for people aged 51 to 61 in 1991 (N=7,544) and 61 to 71 in 2001 (N=5,711) using the RAND Health and Retirement Study. We found that the rate of net worth accumulation by the fifth (top) quintile was extremely high in 1991, and the distribution of net worth became more skewed in favor of the wealthy in 2001. Older adults in the first and second quintiles are unable to face the challenge of the shift in responsibility for income security from the government to individuals. Adapted from the source document. %B Journal of Sociology and Social Welfare %I 38 %V 38 %P 9-30 %G eng %U https://scholarworks.wmich.edu/jssw/vol38/iss3/2 %N 3 %4 Elderly/Income/Retirement/Health/Net Worth %$ 62832 %0 Journal Article %J The Journal of Human Resources %D 2011 %T Pensions and Household Wealth Accumulation %A Gary V. Engelhardt %A Kumar, Anil %K Adult children %K Employment and Labor Force %K Methodology %K Net Worth and Assets %K Pensions %X Economists have long suggested that higher private pension benefits crowd out other sources of household wealth accumulation. We exploit detailed information on pensions and lifetime earnings for older workers in the 1992 wave of the Health and Retirement Study and employ an instrumental-variable (IV) identification strategy to estimate crowd-out. The IV estimates suggest statistically significant crowd-out: each dollar of pension wealth is associated with a 53 67 cent decline in nonpension wealth. With less precision, we use an instrumental-variable quantile regression estimator and find that most of the effect is concentrated in the upper quantiles of the wealth distribution. %B The Journal of Human Resources %I 46 %V 46 %P 203-236 %G eng %U https://www.jstor.org/stable/25764809 %N 1 %L newpubs20110418_Engelhardt.pdf %4 pension Wealth/Regression analysis/Older workers/Pensions/Estimating techniques/Households/Wealth %$ 24970 %0 Report %D 2011 %T Personality and Response to the Financial Crisis %A Angela Lee Duckworth %A David R Weir %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %X In a previous study, we found the family of personality traits known as conscientiousness to be associated in cross-sectional analyses with both lifetime earnings and wealth. In this study, we used data from an Internet survey of HRS respondents in the second quarter of 2009 to test whether conscientiousness and other Big Five factors prospectively predicted responses to the financial crisis of 2008/09. In addition, to improve the targeting and design of behavioral interventions for at-risk individuals, we examined two specific facets of conscientiousness (i.e., self-control and perseverance) that may be more highly related to these economic outcomes than other facets. Finally, we used data from the Consumption and Activities Mail Survey (CAMS) to examine whether personality is related to the proportion of income saved vs. spent. Missing data precluded sufficiently powerful prospective analyses of personality and responses to the financial crisis. Likewise, data on self-control and perseverance from the 2010 experimental module were not sufficient at the time of final reporting to come to definitive conclusions about how these facets relate to economic outcomes. We did find that conscientious adults save more and spend less of their incomes, whereas adults who are higher in openness to experience (e.g., adventurous, sophisticated) save less and spend more of their income. The robust associations between conscientiousness and economic outcomes suggests further investigation of interventions that improve conscientiousness as well as policies that specifically target less conscientious individuals (e.g., default choices for retirement savings). %B Michigan Retirement and Disability Research Center Working Paper %I The University of Michigan %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/projects/personality-and-response-to-the-financial-crisis/ %4 wealth/lifetime earnings/lifetime earnings/conscientiousness/conscientiousness/great Recession %$ 62852 %0 Thesis %D 2011 %T Three essays on socioeconomic status, social support, and the Health and Retirement Study %A Allison R Sullivan %K Adult children %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X The associations between both socioeconomic status and mortality and social support and mortality are widely recognized, though the mechanisms that underlie these associations are less well understood. The Health and Retirement Study allows for a rich exploration of these associations. In the first essay, I investigate mortality differentials by both education and household wealth, first for all causes combined and then over seven different causes of death. Both education and wealth are strongly associated with mortality. I find that the SES gradient is strongest for lung cancer and respiratory diseases, and the gradient is weakest for cancers other than lung and cerebrovascular diseases. In the second essay, I explore how mortality risk increases upon becoming widowed, and what factors increase or mitigate that change in risk. I find that becoming widowed is associated with a nearly 50% increase in mortality risk, net of demographic controls. Some evidence indicates that this risk increase may be due to consequences of adjusting to a new living environment, although some is certainly due to selection into widowhood. Factors that mitigated widowhood mortality risk included education and wealth; children did not have an association with widowhood mortality risk. A spouse may be an irreplaceable source of support. In the third essay, I explore mortality differentials by religion. I find that substantial differences exist, with Mainline Protestants and Jews having the most favorable mortality. Differences were partially explained by socioeconomic status. While Catholics, evangelical Protestants, and black Protestants benefit from favorable attendance patterns, attendance (or lack of) at services explains much of the higher mortality of those with no religious preference. Health behaviors do not mediate the relationship between mortality and religion, except among evangelical Protestants. %I University of Pennsylvania %C United States -- Pennsylvania %V Ph.D. %P 220 %8 2011 %G eng %U http://proquest.umi.com.proxy.lib.umich.edu/pqdweb?did=2609429601&Fmt=7&clientId=17822&RQT=309&VName=PQD %9 3500234 %4 Religion %$ 62846 %! Three essays on socioeconomic status, social support, and the Health and Retirement Study %0 Journal Article %J Advances in Life Course Research %D 2011 %T Trajectories of alcohol consumption among the elderly widowed population: A semi-parametric, group-based modeling approach %A Hui-Peng Liew %K Demographics %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %X Even though research on the use, misuse, and abuse of alcohol among the elderly has burgeoned in recent decades (see reviews by Johnson, 2000 , Kirchner et al., 2007 and Patterson and Jeste, 1999 ), only a few empirical studies have explored the post-bereavement alcohol consumption trajectories among the elderly widowed population. To fill this research gap, this study aims to examine the temporal processes underlying the relationship between widowhood and subsequent drinking behaviors among the elderly widowed population and to examine the potential predictors of these trajectories. The empirical work of this study is based on longitudinal data from the 1992 to 2008 Health and Retirement Study (HRS). A semi-parametric mixture model (SPMM) is used to estimate the distinctive trajectories of post-bereavement alcohol consumption. Results reveal that the type of drinking trajectory that characterize the post-bereavement drinking behavior of an individual is largely dependent upon the characteristics of the individuals (e.g. gender), the health conditions and health behavior of deceased spouse, pre-bereavement alcohol consumption, and depression. Another important finding is that bereaved men seem to have greater difficulty overcoming the transitional burden associated with widowhood. Copyright Elsevier Ltd. %B Advances in Life Course Research %I 16 %V 16 %P 124-131 %G eng %4 Drinking Behavior/Health Behavior/Alcohol Abuse/Widowhood/Elderly/gender/Elder Abuse/Bereavement %$ 69612 %R 10.1016/j.alcr.2011.08.001 %0 Report %D 2010 %T The Asset Cost of Poor Health %A James M. Poterba %A Steven F Venti %A David A Wise %K Health Conditions and Status %K Net Worth and Assets %X This paper examines the correlation between poor health and asset accumulation for households in the first nine waves of the Health and Retirement Survey. Rather than enumerating the specific costs of poor health, such as out of pocket medical expenses or lost earnings, we estimate how the evolution of household assets is related to poor health. We construct a simple measure of health status based on the first principal component of HRS survey responses on self-reported health status, diagnoses, ADLs, IADL, and other indicators of underlying health. Our estimates suggest large and substantively important correlations between poor health and asset accumulation. We compare persons in each 1992 asset quintile who were in the top third of the 1992 distribution of latent health with those in the same 1992 asset quintile who were in the bottom third of the latent health distribution. By 2008, those in the top third of the health distribution had accumulated, on average, more than 50 percent more assets than those in the bottom third of the health distribution. This asset cost of poor health appears to be larger for persons with substantial 1992 asset balances than for those with lower balances. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %4 health Status/Asset accumulation %$ 26100 %R 10.3386/w16389 %0 Thesis %B Sociology %D 2010 %T Discrimination and health: A longitudinal study %A Jun Xu %Y Ye Luo %K Adult children %K Demographics %K Employment and Labor Force %K Healthcare %K Net Worth and Assets %X This study examines several questions about discrimination using a longitudinal survey from the 2006 and 2008 waves of the Health and Retirement Study (HRS). Results show that whites are least likely to experience discrimination as we expected. In addition, the data provides support for the hypothesis that people with higher total household assets and higher household total number of members are less likely to experience discrimination. However, contrary to my hypothesis, females have smaller odds of experiencing discrimination compared to males. People with higher education levels are more likely to report major discrimination events compared to those with lower education levels. There is a negative relationship between everyday discrimination and individuals' change in health, but the relationship between major discrimination events and individuals' change in health is not significant. Therefore, the hypothesis that perceived discrimination is linked to adverse change in health is partially supported. Moreover, the buffering effect of social support in the relationship between perceived discrimination and change in health is not supported, and the hypothesis that detrimental effect of discrimination is stronger to men than women is partially supported. %B Sociology %I Clemson University %V M.S. %P 59 %G eng %U https://tigerprints.clemson.edu/all_theses/933/ %9 Dissertation %4 Wealth %$ 24040 %! Discrimination and health: A longitudinal study %0 Report %D 2010 %T Does Stock Market Performance Influence Retirement Expectations? %A Gopi Shah Goda %A John B. Shoven %A Sita Nataraj Slavov %K Consumption and Savings %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Women and Minorities %X While media reports predicted substantial changes in labor supply behavior due to the sharp decline in the value of the stock market in October 2008, empirical evidence on the relationship between equity markets and retirement is mixed. We use panel data from the Health and Retirement Study to investigate the relationship between stock market performance and plans for retirement during 1998-2008, a period that includes the recent financial crisis, by exploiting within-year variation in the SandP 500 index across plausibly exogenous dates of interview. While we do detect a statistically significant negative relationship between the reported probability of working full-time at age 62 and the SandP 500 index in the most recent years of our study period, we do not find strong evidence that changes in equity markets influence changes in retirement plans over the period as a whole. We conclude that the higher probabilities of working reported in recent years were likely due to factors other than stock market performance, such as pessimism about economic security more generally. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %4 Economics of the Elderly/Economics of the Handicapped/Non-labor Market Discrimination/Retirement, Retirement Policies/stock Market/retirement Planning %$ 23910 %R 10.3386/w16211 %0 Journal Article %J Review of Economics and Statistics %D 2010 %T The Effect of Inheritance Receipt on Retirement %A Brown, Jeffrey R. %A Courtney Coile %A Weisbenner, Scott J %K Adult children %K Employment and Labor Force %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X This paper provides new evidence on how wealth shocks influence retirement behavior. Economic theory generally posits that leisure is a normal good, yet it is difficult to obtain reliable empirical estimates of the wealth effect because wealth is correlated with numerous unobservable characteristics that affect labor supply. We use inheritance receipt as a wealth shock and find that it is associated with a significant increase in the probability of retirement, especially when the inheritance is unexpected. This evidence has important implications for how public policies, such as pension or tax reform, may influence retirement behavior through the wealth effect. %B Review of Economics and Statistics %I 92 %V 92 %P 425-434 %G eng %N 2 %4 Wealth/Impact analysis/Retirement planning/Inheritances/Studies/Labor supply %$ 25260 %R 10.1162/rest.2010.11182 %0 Report %D 2010 %T The Effects of Medicaid and Medicare Reforms on the Elderly s Savings and Medical Expenditures %A Mariacristina De Nardi %A Eric French %A John Bailey Jones %A Michigan Retirement Research Center %K Health Conditions and Status %K Net Worth and Assets %X This study explores the relationship between general human capital investment, financial knowledge, occupational spillovers, and the accumulation of wealth in a primarily descriptive manner. Drawing upon human capital theory and following previous related work by Delavande, Rohwedder and Willis (2008), we hypothesized that individuals with daily exposure to financial knowledge through their occupation would benefit by having greater financial knowledge that would translate into greater wealth accumulation than individuals who do not enjoy such spillovers from their occupation. Using data from the Cognitive Economics Study and the Health and Retirement Study, we find strong evidence that individuals in financial occupations tend to have greater financial knowledge and moderate evidence that they also have greater wealth accumulation. %B Michigan Retirement Research Center Research Working Paper %I The University of Michigan, Michigan Retirement Research Center %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/pubs/the-effects-of-medicaid-and-medicare-reforms-on-the-elderlys-savings-and-medical-expenditures-2/ %4 human Capital/financial knowledge/wealth Accumulation/Cognitive Economics Study %$ 24330 %0 Report %D 2010 %T Employment Patterns and Determinants Among Older Individuals with a History of Short-Duration Jobs %A Kevin E. Cahill %A Michael D. Giandrea %A Joseph F. Quinn %K Consumption and Savings %K Employment and Labor Force %K Net Worth and Assets %K Pensions %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %K Women and Minorities %X Many studies of labor force withdrawal patterns have focused on individuals who have had career jobs. This paper compares the demographic and economic characteristics of individuals who have never had a full-time career (FTC) job with those who have, and compares the timing and types of job switches that both groups make later in life. The comparison between non-FTC and FTC individuals is important because decisions by policymakers based on the existing retirement literature may have unintended consequences for individuals with only a series of short-duration jobs. We use a sample of respondents from the Health and Retirement Study (HRS) who have worked since age 50, and stratify respondents according to whether an individual has ever had a job that consists of 1,600 or more hours per year and lasts for at least ten years (i.e., a full-time career job). We find that individuals without FTC jobs are a heterogeneous group, representing individuals in many wage and occupational categories. Not surprisingly, we also find that individuals without FTC jobs are less likely than those with FTC jobs to be working in subsequent survey years. However, we find that the labor force withdrawal patterns of non-FTC individuals are similar to those of FTC individuals in many respects. In particular, individuals without FTC jobs change jobs later in life just as frequently as those with FTC jobs. Switching rates between wage-and-salary employment to self-employment and between white-collar and blue-collar jobs are largely similar by FTC status, as are reductions in wages later in life. Overall, the findings reveal that the work decisions later in life of individuals who have never had career employment are diverse, just as they are for individuals with career jobs. %B U.S. Bureau of Labor Statistics, Working Papers %I U.S. Bureau of Labor Statistics %C Washington, D.C. %V 440 %G eng %U https://www.bls.gov/osmr/research-papers/2010/ec100080.htm %N 33 %4 Retirement, Retirement Policies/Economics of the Elderly/Economics of the Handicapped/Non-labor Market Discrimination/Nonwage Labor Costs and Benefits/Private Pensions/Social Security/Public Pensions/Economics of Aging/Bridge Jobs/Gradual Retirement %$ 23940 %0 Thesis %B Economics %D 2010 %T Essays in contemporary tax law changes %A Biswas, Arpita %Y Wilson, Paul W. %K Net Worth and Assets %K Other %K Public Policy %X In the first essay, I provide estimates of price and income elasticities of charitable contributions which reveal substantial differences in giving patterns across different income groups. The paper develops an intertemporal model of giving which predicts that lowering current income taxes induces substitution away from current giving towards giving in future periods. Cragg's Generalized Tobit model applied to Consumer Expenditure data from 1997-2006 provides estimates of income and price elasticities conditioned upon contribution, which range between 0.17 to 0.81 and -0.50 to -1.16 respectively. Empirical analysis shows substantial evidence of intertemporal substitution, implying that if the difference between future and current prices increase by 1 percent, current period giving increases by 0.8 percent. The second essay is an extension of the first, wherein I provide estimates of how reduction in income tax rates brought about by EGTRRA, 2001 and alternative tax rate regimes affect charitable contributions. Results from difference-in-difference analysis suggests that after Economic Growth Tax Relief Reconciliation Act (EGTRRA), itemizers reduced their contributions by 24% and the likelihood of contributions fell by 10%. While limiting the tax deductibility to 28% reduces price elasticity by 0.02 percentage points, a flat tax rate regime makes contributions 11 percentage points more price elastic compared to the progressive tax rate system. The third essay focuses on another contemporary tax law change, reduction in capital gains and dividend tax rates brought about by Jobs and Growth Tax Relief and Reconciliation Act, 2003. I study two main impacts of the law change, the effect on portfolio allocation between retirement and non-retirement accounts and the effect on labor supply decisions. Difference-in-difference analysis using Health and Retirement Study finds that for the age group above 55, annual investments in IRA fall by $175 and the likelihood of holding IRAs fall by 11%. With respect to labor market behavior, annual labor supply for individuals who diversify their assets fall by 41 hours and about 9 individuals drop out of the labor force. Results using planned retirement age as a dependent variable shows increase in expected retirement age, indicating intertemporal substitution of labor supply. %B Economics %I Clemson University %V Ph.D. %P 115 %G eng %U https://tigerprints.clemson.edu/all_dissertations/589/ %4 Tax law %$ 24030 %! Essays in contemporary tax law changes %0 Journal Article %J Journal of Econometrics %D 2010 %T Estimating willingness to pay for medicare using a dynamic life-cycle model of demand for health insurance %A Ahmed Khwaja %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %K Other %K Public Policy %X Medicare is the largest health insurance program in the US. This paper uses a dynamic random utility model of demand for health insurance in a life-cycle human capital framework with endogenous production of health to calculate the individual willingness to pay (WTP) for Medicare. The model accounts for the feature that the demand for health insurance is derived through the demand for health, which is jointly determined with the production of health over the life-cycle. The WTP measure incorporates the effects of Medicare insurance on aggregate consumption through effects on medical expenditures and mortality, and consumption utility of health. The model is estimated using panel data from the Health and Retirement Study. The average WTP or change in lifetime expected utility resulting from delaying the age of eligibility to 67 is found to be 24,947 in 1991 dollars ( 39,435 in 2008 dollars). However, there is considerable variation in the WTP, e.g., in 1991 dollars the WTP of individuals who have less than a high school education and are white is 28,347 ( 44,810 in 2008 dollars), while the WTP of those with at least a college degree and who are neither white nor black is 15,584 ( 24,635 in 2008 dollars). More generally, the less educated have a higher WTP to avoid a policy change that delays availability of Medicare benefits. Additional model simulations imply that the primary benefits of Medicare are insurance against medical expenditures with relatively smaller benefits in terms of improved health status and longevity. Medicare also leads to large increases in medical utilization due to deferring of medical care prior to eligibility. %B Journal of Econometrics %I 156 %V 156 %P 130-147 %G eng %N 1 %4 health Insurance/Willingness to pay/Medicare/Human capital/Economic models/Public Policy %$ 22300 %R https://doi.org/10.1016/j.jeconom.2009.09.011 %0 Journal Article %J Economic Inquiry %D 2010 %T Estimation and Impact of Gender Differences in Risk Tolerance %A Neelakantan, Urvi %K Net Worth and Assets %K Pensions %K Risk Taking %X This paper provides numerical estimates of the distributions of risk tolerance for men and women. A simple model of individual portfolio choice is calibrated to data on Individual Retirement Accounts from the Health and Retirement Study to obtain the estimates. Results show that women tend to be less risk-tolerant than men. The estimates are then used to measure the impact of risk tolerance on wealth accumulation. Simulations show that the difference in risk tolerance can account for around 10 of the gender difference in accumulated wealth. %B Economic Inquiry %I 48 %V 48 %P 228-233 %G eng %N 1 %L newpubs20100407_Neelakantan.pdf %4 risk tolerance/individual retirement accounts/wealth accumulation %$ 21820 %R https://doi.org/10.1111/j.1465-7295.2009.00251.x %0 Report %D 2010 %T Family Status Transitions, Latent Health, and the Post-Retirement Evolution of Assets %A James M. Poterba %A Steven F Venti %A David A Wise %K Adult children %K Housing %K Net Worth and Assets %K Pensions %X We consider the evolution of assets after retirement. We ask whether total assets--including housing equity, personal retirement accounts, and other financial assets--tend to be husbanded for a rainy day and drawn down primarily at the time of precipitating shocks, or whether they are drawn down throughout the retirement period. We focus on the relationships between family status transitions, latent health status, and the evolution of assets. Our analysis is based primarily on longitudinal data from the HRS and AHEAD cohorts of the Health and Retirement Study. We find that the evolution of assets is strongly related to family status transitions. For both single individuals and married couples who do not experience a death or divorce, total assets increase well into old age. In contrast, individuals in married couples that experience a family status transition, either a death or a divorce, exhibit much slower asset growth and often experience a large decline in asset values at the time of the transition. In addition, the level and evolution of assets is very strongly related to health, measured by a latent health index. For example, for continuing two-person HRS households between the ages of 56 and 61 in 1992 the ratio of assets of households in the top health quintile to the assets of those in the bottom quintile was 1.7 in 1992. It had increased to 2.2 by the end of 2006. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %L newpubs20100407_Poterba.pdf %4 Asset allocation/housing Equity/personal retirement accounts/family transfers, structure %$ 21830 %R 10.3386/w15789 %0 Report %D 2010 %T Financial Knowledge and Financial Literacy at the Household Level %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Health Conditions and Status %K Net Worth and Assets %K Other %K Pensions %X This paper uses data from the Health and Retirement Study to explore the mechanism that underlies the robust relation found in the literature between cognitive ability, and in particular numeracy, and wealth, income constant. We have a number of findings. First, the more valuable the pension, the more knowledgeable are covered workers about their pensions. We suggest that causality is more likely to run from pension wealth to pension knowledge, rather than the other way around. Second, most measures of cognitive ability, including numeracy, are not significant determinants of pension and Social Security knowledge. Third, standardizing for incomes and other factors, a pension of higher value does not substitute for other forms of wealth. Rather, counting pensions in total wealth, those with more valuable pensions save more for retirement, other things the same. Fourth, there is no evidence that wealth held outside of pensions is influenced by knowledge of pensions. In sum, numeracy does not influence wealth in whole or in part by affecting financial knowledge of one's pension plan, where financial knowledge of the pension then influences other decisions about retirement saving. These findings raise questions about the mechanism that underlies the relation between cognition, especially numeracy, and wealth. From a policy perspective, they suggest that the numeracy-wealth relation should not be taken as evidence that increasing financial literacy will increase the wealth of households as they enter into retirement. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %4 cognitive ability/numeracy/wealth/pensions %$ 24390 %R 10.3386/w16500 %0 Journal Article %J Journal of Financial Planning %D 2010 %T Financial Literacy Lacking Among Older Population %A Anonymous %K Demographics %K Net Worth and Assets %K Other %X A new look at the financial literacy and sophistication of people 55 and older reveals the need for educational efforts targeted to specific demographics. Financial Literacy and Financial Sophistication in the Older Population: Evidence from the 2008 HRS, a University of Michigan Retirement Research Center working paper by Annamaria Lusardi, Olivia S. Mitchell, and Vilsa Curto, analyzes new data on financial literacy from the University of Michigan's 2008 Health and Retirement Study. According to the authors, their research suggests it may be particularly important to build retirement human capital through seminars, educational programs, and retirement planning products. %B Journal of Financial Planning %I 23 %V 23 %P 14 %G eng %N 2 %4 Financial literacy/Older people/Research %$ 22900 %0 Report %D 2010 %T Gain and Loss: Marriage and Wealth Changes Over Time %A Julie M Zissimopoulos %K Adult children %K Healthcare %K Income %K Net Worth and Assets %X Family composition has changed dramatically over the past 25 years. Divorce rates increased and remarriage rates declined. While considerable research established a link between marriage and earnings, far less is empirically understood about the effect of marriage on wealth although wealth is an important measure for older individuals because it represents resources available for consumption in retirement. This research employs eight waves of panel data from the Health and Retirement Study to study the relationship between wealth changes and marital status among individuals over age 50. It advances understanding of the relationship by first, incorporating measures of current and lifetime earnings, mortality risk and other characteristics that vary by marital status into models of wealth change; second, measuring the magnitude of wealth loss and gain associated with divorce, widowing and remarriage and third, estimating wealth change before and after marital status change so the change in wealth change is not the result of individuals entering or leaving the household and other sources of unobserved differences are removed from estimates of the effect of marriage on wealth. The results suggest no differences in wealth change over time among individuals that remain married, divorced, widowed, never married and partnered over 7 years. In the short-run there are substantial wealth changes associated with marital status changes. Divorce at older ages is costly, remarriage is wealth enhancing and people appear to change their savings in response to changes in marital status. %B RAND Working Paper %I RAND Corporation %C Santa Monica, CA %G eng %U https://www.rand.org/pubs/working_papers/WR724.html %4 household income/individual income/Wealth/Marriage/divorce/Marital Dissolution/Family Structure/Domestic Abuse %$ 22100 %0 Report %D 2010 %T Health and Wealth in a Life-Cycle Model %A John Karl Scholz %A Ananth Seshadri %K Consumption and Savings %K Event History/Life Cycle %K Health Conditions and Status %K Healthcare %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %X This paper presents a preliminary model of health investments over the life cycle. Health affects both longevity and provides flow utility. We analyze the interplay between consumption choices and investments in health by solving each household s dynamic optimization problem to obtain predictions on health investments and consumption choices over the lifecycle. Our preliminary model does a good job of matching the distribution of medical expenses across households in the sample. We illustrate the scope of future model applications by examining the effects of a stylized Medicare program on patterns of wealth and mortality. %I The University of Michigan, Michigan Retirement Research Center %G eng %U https://mrdrc.isr.umich.edu/pubs/health-and-wealth-in-a-life-cycle-model/ %4 life Cycle/consumption/health investments/Medical Expenditures/wealth/mortality %$ 24380 %0 Report %D 2010 %T Individuals' Uncertainty about Future Social Security Benefits and Portfolio Choice %A Delavande, Adeline %A Susann Rohwedder %K Consumption and Savings %K End of life decisions %K Expectations %K Income %K Methodology %K Net Worth and Assets %X Little is known about the degree to which individuals are uncertain about their future Social Security benefits, how this varies within the U.S. population, and whether this uncertainty influences financial decisions related to retirement planning. To illuminate these issues, the authors present empirical evidence from the Health and Retirement Study Internet Survey and document systematic variation in respondents' uncertainty about their future Social Security benefits by individual characteristics. They find that respondents with higher levels of uncertainty about future benefits hold a smaller share of their wealth in stocks. %I Santa Monica, RAND Corporation Publications Department Working Papers %G eng %U http://www.rand.org/pubs/working_papers/2010/RAND_WR782.pdf %4 Investment/Personal Finance/Personal Finance/Criteria for Decision-Making under Risk and Uncertainty/Criteria for Decision Making under Risk and Uncertainty/Econometrics/expectations, portfolio choice, subjective probabilities,/uncertatinty, Health and Retirement Study %$ 24450 %0 Thesis %B Economics %D 2010 %T A life-cycle analysis of retirement savings and portfolio choices: Optimal asset allocation and location with taxable and tax-deferred investment %A Li, Zhe %Y Hugo Benítez-Silva %K Consumption and Savings %K Event History/Life Cycle %K Methodology %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X In this study, I analyze theoretically and empirically the optimal saving and investment decisions of the households in Defined Contribution (DC) pension accounts, and show that the pension characteristics play important roles in explaining the households' behavior. The first essay attempts to explain the observed asset allocation and location decisions for households making taxable and tax-deferred investment. I incorporate employer matching policies and other pension account characteristics into a life-cycle model of optimal intertemporal consumption and portfolio choice, which includes a taxable saving account and a tax-deferred retirement saving account. The model is estimated using data from the Surveys of Consumer Finances (1992 to 2007), and the structural parameters are recovered by the Method of Simulated Moments. After modeling the features of U.S. pension system, the predicted policy rules are able to explain the observed portfolio patterns of American households, who are more likely to hold equities in the tax-deferred pension account. The estimates and results show that employer matching policy induces higher proportion of total wealth held in the pension account, so investors tend to reduce equity holdings in the taxable account for precautionary saving purpose and boost equity investments in the tax-deferred account to maintain an optimal portfolio mix. I find that a 10 percentage point increase in the estimated employer matching rate makes investors reduce the average equity proportion in the taxable account by 22 percentage point and boost those holdings in the pension account by 10 percentage point. In contrast, since the employer stock match exposes the households to a riskier situation in the pension account than the cash match, it causes households voluntarily to hold less equity in that account, resulting in an average decrease of 4 percentage point in the equity ownership and 3 percentage point in the conditional equity proportion. Moreover, the policy experiment reveals that a deletion of Social Security taxes and payments makes the pension account the only source of retirement income, so households tend to put a higher proportion of savings in the tax-deferred account, and they are likely to invest conservatively and hold about 25 percent more of pension wealth in relatively safe assets. The second essay is about company stock investment in 401(k) plans. Previous studies on the determinants of company stock holdings focus on the past stock market performance of company stock, but ignore the characteristics of the retirement plans and individuals. In this study, using the data from Survey of Consumer Finances (SCF), I provide an empirical analysis of the factors that affect company stock holdings in 401(k) plans, by analyzing a broad list of company features, individual characteristics, and financial wealth information. My preferred estimates suggest that, different from general stocks which are sensitive to risk preference and total wealth, the decision of whether to hold company stock is more likely to be affected by the employer's characteristics and the availability of other investment opportunities. Individuals who work in larger companies and receive more employer matches in the retirement account are more likely to hold company stock in the retirement account, and they are less likely to hold company stocks when the wealth outside the pension account is large and they have other retirement accounts. In addition, I find that the company stock share in 401(k) account is decreasing with pension wealth and total net wealth, which indicates that less wealthy individuals are those who are more exposed to company stock risk. The third essay analyzes the impact of investment choice on savings in defined contribution pensions. The striking growth defined contribution (DC) pensions have vastly expanded the number of individuals with some discretion regarding their retirement savings. One of the factors that may affect saving decisions is investment choice: namely the ability of the participant to direct the investment of the assets in the pension account. In most studies, people who report that they have control over assets allocation in pension plans do not distinguish the assets between the participant contribution and the employer contribution, but it is common for the employer's contribution to be constrained-often to company stock. In this study, I use the Health and Retirement Study (HRS) to estimate the impacts of unconstrained and constrained investment choices on participant saving levels in DC Pensions. The estimates and results indicate that participants with investment choice contribute over 3 percentage points more of their earnings into the defined contribution plan than people without choice, and people constrained in their investment contribute about 3 percentage points less in their retirement saving account. In addition, I find that male and lower income participants tend to contribute more in a self-directed saving account. %B Economics %I State University of New York at Stony Brook %C Stony Brook, NY %V Ph.D. %G eng %U https://crr.bc.edu/about-us/grants/a-life-cycle-analysis-of-retirement-savings-and-portfolio-choices-optimal-asset-allocation-and-location-with-taxable-and-tax-deferred-investment/ %4 Saving %$ 23360 %! A life-cycle analysis of retirement savings and portfolio choices: Optimal asset allocation and location with taxable and tax-deferred investment %0 Report %D 2010 %T Liquidity Constraints, Household Wealth, and Self-Employment: The Case of Older Workers %A Julie M Zissimopoulos %A Lynn A Karoly %A Gu, Qian %K Employment and Labor Force %K Income %K Net Worth and Assets %K Other %X Evidence of liquidity constraints affecting entrepreneurship includes increasing rates of business formation with increases in household wealth and no relationship between the likelihood of business formation and wealth at high wealth levels. Using longitudinal data from the Health and Retirement Study on workers over age 50 and employing probit regressions with a non-linear specification of household wealth and liquid wealth, the authors find the relationship between wealth and business formation is consistent with this pattern. The paper also finds that wealth matters more for the formation of businesses requiring high starting capital. Employing the availability of a lump-sum distribution option (LSO) of an employer-provided pension plan as a new proxy for liquidity, the results show that workers with an LSO are more likely than workers with a pension and without an LSO to transition into self-employment. This provides further evidence of the existence and importance of liquidity constraints. %B RAND Working Paper %I RAND Corporation %C Santa Monica, CA %G eng %U https://www.rand.org/pubs/working_papers/WR725.html %4 household income/individual income/wealth/Business start-up/Entrepreneurship %$ 22110 %0 Report %D 2010 %T Mortality Differences in Windowhood %A Allison R Sullivan %K Adult children %K Health Conditions and Status %K Net Worth and Assets %X Being widowed elevates mortality risk, relative to married men or women of the same age. I investigate how risk varies by subpopulation of widows and widowers. Specifically, using data from the Health and Retirement Study, I test for differences in widowhood mortality by education, by number of children, and by how sudden or expected the death of the pre-decedent spouse was. Consistent with other studies, I find an increased hazard of mortality upon widowhood. In contrast with other studies but consistent with the larger literature on SES and mortality, education is protective in widowhood. Number of children has a u-shaped association with mortality in widowhood, with those having 3-4 children having the lowest levels of mortality after death of a spouse. Lingering deaths (deaths after a chronic condition) of the predecedent spouse are much for the surviving spouse than sudden deaths or other types of death. Important gender differences occur with each of these effects. These findings illuminate mechanisms through which mortality is affected by widowhood, and provide evidence on the power of SES and social support in vulnerable populations. %I Philadelphia, PA, Population Studies Center, University of Pennsylvania %G eng %4 Widowhood/Mortality/spousal death/spousal death %$ 62851 %0 Report %D 2010 %T Occupational Learning, Financial Knowledge, and the Accumulation of Retirement Wealth %A Brooke Helppie %A Kandice Kapinos %A Robert J. Willis %A Michigan Retirement Research Center %K Health Conditions and Status %K Net Worth and Assets %X This study explores the relationship between general human capital investment, financial knowledge, occupational spillovers, and the accumulation of wealth in a primarily descriptive manner. Drawing upon human capital theory and following previous related work by Delavande, Rohwedder and Willis (2008), we hypothesized that individuals with daily exposure to financial knowledge through their occupation would benefit by having greater financial knowledge that would translate into greater wealth accumulation than individuals who do not enjoy such spillovers from their occupation. Using data from the Cognitive Economics Study and the Health and Retirement Study, we find strong evidence that individuals in financial occupations tend to have greater financial knowledge and moderate evidence that they also have greater wealth accumulation. %B Working Paper %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %U http://hdl.handle.net/2027.42/78354 %4 human capital/financial knowledge/Cognitive Economics Study/wealth Accumulation %$ 24320 %0 Book %D 2010 %T Pensions in the Health and Retirement Study %A Alan L Gustman %A Thomas L. Steinmeier %A N. Tabatabai %K Employment and Labor Force %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X Draws evidence from the National Institute on Aging's Health and Retirement Study to examine the pensions held by those approaching retirement age in the United States. Discusses theories explaining pensions; employment and retirement in the Health and Retirement Study; pension data in the Health and Retirement Study; pension plan participation in the Health and Retirement Study; pension plan type; imperfect knowledge of pension plan type; pension retirement ages; pension values; retirement incentives from defined benefit pensions; disposition of pensions upon leaving a job and pension incomes in retirement; and the changing role of pensions in total wealth. %I Harvard University Press %C Cambridge and London %G eng %U https://www.hup.harvard.edu/catalog.php?isbn=9780674048669&content=toc %4 pension Plans/Wealth/retirement Planning/employment/pension income %$ 23150 %0 Report %D 2010 %T Psychological Adjustment To Widowhood: The Role Of Income, Wealth And Time %A Karen C. Holden %A Jeungkun Kim %A Beatriz Novak %K Net Worth and Assets %K Women and Minorities %X This paper uses data from two longitudinal surveys to examine the relationship between psychological well-being and financial well-being of older women and men, with specific interest in differences by marital status and duration of widowhood. The Wisconsin Longitudinal Study (WLS) provides a look at the consequences of relatively early widowhood. The Health and Retirement Study (HRS) has interviewed a representative sample of individuals 50 and older over the last two decades. We use the data from that survey to examine the adjustment to widow(er)hood over a larger age range, but with likely less precision to measure differences among women of a single age. %I Society of Actuaries Pension Section Research Committee %G eng %U https://www.soa.org/globalassets/assets/Files/Research/Projects/research-2010-widowhood.pdf %4 Widowhood/WOMEN/wealth %$ 25940 %0 Book %B The Economics of Aging %D 2010 %T Research findings in the economics of aging %A David A Wise %K Demographics %K Disabilities %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Pensions %X The baby boom generation’s entry into old age has led to an unprecedented increase in the elderly population. The social and economic effects of this shift are significant, and in Research Findings in the Economics of Aging, a group of leading researchers takes an eclectic view of the subject. Among the broad topics discussed are work and retirement behavior, disability, and their relationship to the structure of retirement and disability policies. While choices about when to retire are made by individuals, these decisions are influenced by a set of incentives, including retirement benefits and health care, and this volume includes cross-national analyses of the effects of such programs on these decisions. Furthermore, the volume also offers in-depth analysis of the effects of retirement plans, employer contributions, and housing prices on retirement. It explores well-established relationships among economic circumstances, health, and mortality, as well as the effects of poverty and lower levels of economic development on health and life satisfaction. By combining micro and macro evidence, this volume continues a tradition of expanding the research agenda on the economics of aging. %B The Economics of Aging %I University of Chicago Press %C Chicago %@ 0-226-90306-0 %G eng %U https://www.nber.org/books-and-chapters/research-findings-economics-aging %4 Aging / Economic aspects / Congresses./Older people / Economic conditions / Congresses./Old age pensions / Congresses./Disability retirement / Congresses./Medicare / Congresses. %$ 26200 %0 Report %D 2010 %T The Risk of Out-of-Pocket Health Care Expenditure at End of Life %A Samuel M Marshall %A Kathleen McGarry %A Jonathan S Skinner %K Demographics %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %X There is conflicting evidence on the importance of out-of-pocket medical expenditures as a risk to financial security, particularly at older ages. We revisit this question, focusing on health care spending near the end of life using data from the Health and Retirement Study for the years 1998-2006. We address difficulties with missing values for various categories of expenditures, outliers, and variations across individuals in the length of the reporting period. Spending in the last year of life is estimated to be 11,618 on average, with the 90th percentile equal to 29,335, the 95th percentile 49,907, and the 99th equal to 94,310. These spending measures represent a substantial fraction of liquid wealth for decedents. Total out-of-pocket expenditures are strongly positively related to wealth and weakly related to income. We find evidence for a mechanism by which wealth could plausibly buy health: large expenditures on home modifications, helpers, home health care, and higher-quality nursing homes, which have been shown elsewhere to improve longevity. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %4 health care costs/demographics/education/wealth/Longevity %$ 23280 %R 10.3386/w16170 %0 Report %D 2010 %T The Role of Re-entry in the Retirement Process %A Michael D. Giandrea %A Kevin E. Cahill %A Joseph F. Quinn %K Consumption and Savings %K Employment and Labor Force %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %K Social Security %K Women and Minorities %X To what extent do older Americans re-enter the labor force after an initial exit and what drives these unretirement decisions? Retirement for most older Americans with full-time career jobs is not a one-time, permanent event. Labor force exit is more likely to be a process. Prior studies have found that between one half and two thirds of career workers take at least one other job before exiting from the labor force completely. The transitional nature of retirement may be even more pronounced when considering the impact of re-entry. This paper examines the extent to which older Americans with career jobs re-entered the labor force. The analysis is based on data from the Health and Retirement Study (HRS), an ongoing, longitudinal survey of older Americans that began in 1992. We examined the retirement patterns of a subset of 5,617 HRS respondents who were on a full-time career job at the time of the first interview. Logistic regression was used to explore determinants of re-entry among those who initially exited the labor force. We found that approximately 15 percent of older Americans with career jobs returned to the labor force after initially exiting. Respondents were more likely to re-enter if they were younger, were in better health, or had a defined-contribution pension plan. This research provides empirical evidence of how older Americans are utilizing bridge jobs as they transition from career employment, and that re-entry may be an important part of the work experience of older Americans. %B Working Paper %I U.S. Bureau of Labor Statistics %C Washington, D.C. %G eng %U https://www.bls.gov/osmr/research-papers/2010/pdf/ec100070.pdf %4 Retirement, Retirement Policies/Economics of the Elderly/Economics of the Handicapped/Non-labor Market Discrimination/Private Pensions/Social Security and Public Pensions/Economics of Aging/Partial Retirement/Bridge Jobs/Gradual Retirement %$ 23200 %0 Report %D 2010 %T Trigger Events and Financial Outcomes Among Older Households %A Geoffrey L Wallace %A Haveman, Robert %A Karen C. Holden %A Barbara Wolfe %K Adult children %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Social Security %X Follow a sample of social security beneficiaries drawn from the Health and Retirement Study from their first year of retirement up to 15 years into retirement, we estimate rates at which retirees are subject to family structure change, cognitive decline, health decline, and other events. Then we assess the vulnerability of wealth and wealth-based adequacy measures to adverse events, drawing conclusions about the effect of events on a wealth-based measure and a wealth-based inadequacy measure. Our findings highlight the importance of cognitive and health decline as events with the potential to shape the evolution of wealth post-retirement. %B Center for Financial Security Working Paper %I Center for Financial Security, University of Wisconsin-Madison %C Madison, WI %G eng %U https://cfs.wisc.edu/2010/09/10/trigger-events-and-financial-outcomes-among-older-households/ %4 social Security/wealth/adverse events/adverse events/Cognitive decline/health decline/Families %$ 26170 %0 Journal Article %J Cityscape: A Journal of Policy Development and Research %D 2010 %T Using the Health and Retirement Study to Analyze Housing Decisions, Housing Values, and Housing Prices %A Hugo Benítez-Silva %A Selçuk Eren %A Frank Heiland %A Jimenez-Martin, Sergi %K Consumption and Savings %K Demographics %K Housing %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Few existing surveys provide detailed longitudinal information on households and their homes. This article introduces a data source, the Health and Retirement Study (HRS), which has this detailed information but has received little attention by housing researchers to date. The HRS is a rich longitudinal data set that provides information on house values, house prices, and detailed personal characteristics of those who own and sell their homes. The HRS is a nationally representative longitudinal survey that originally sampled 7,700 households headed by an individual aged 51 to 61 in the first interviews in 1992 and 1993. It now also samples additional cohorts of older Americans. Although the HRS is the data set of choice when analyzing the retirement behavior, savings, and health status of older Americans, given its wealth of demographic, health, and socioeconomic data, it has been rarely used to answer questions regarding the housing market. A seldom used section of the questionnaire provides detailed information about real estate transactions by households, however, enabling researchers to repeatedly observe both self-reported house values and the actual selling prices of properties sold since 1992 (originally bought in the past five decades). The article describes a number of important housing-related measures available in the HRS and illustrates the usefulness of these data by conducting a statistical analysis of the accuracy of self-reported home values. Specifically, we analyze the predictive power of self-reported housing wealth when estimating housing prices using the HRS data. The evidence shows a slight overestimation of housing values by older Americans. %B Cityscape: A Journal of Policy Development and Research %I 12 %V 12 %P 149-58 %G eng %N 2 %4 Personal Income, Wealth, and Their Distributions/Housing Demand/Housing/Wealth/Asset accumulation/retirement planning/Mobility/property values %$ 23920 %0 Report %D 2010 %T What Is The Impact Of Foreclosures On Retirement Security? %A Irena Dushi %A Friedberg, Leora %A Anthony Webb %K Net Worth and Assets %X Using data from several sources, we show that households nearing retirement have lower rates of housing distress than younger households, as measured by arrears and foreclosure rates. However, almost all of the housing wealth gains observed for cohorts aged 51-56 between 1992 and 2004 were erased by 2010, while their mortgages have grown throughout. As a consequence, their loan-to-value ratios are considerably higher, though the percentage paying more than 30 percent of their household income towards their mortgage remains flat. Worrisomely, their financial wealth also declined between 2004 and 2010. Declines in house prices will adversely affect households that need to liquidate housing wealth, and rising mortgage obligations will increase pressure on retirement resources. We develop an econometric model to show factors associated with housing distress and then use the results to forecast housing distress among older households through 2012. We project that the risk of arrears will increase to 3.4 percent in 2010 and 4.4 percent by 2012. We also find that 6.7 percent of HRS households have children or other relatives who are facing housing distress, potentially putting further pressure on their retirement preparedness. %I Center for Retirement Research at Boston College %G eng %U http://www.policyarchive.org/handle/10207/bitstreams/95949.pdf %4 housing wealth/mortgage obligation/foreclosure rates %$ 25620 %0 Journal Article %J Journal of Economic Perspectives %D 2010 %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 Employment and Labor Force %K Event History/Life Cycle %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X This paper investigates the effect of the current recession on the 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 Journal of Economic Perspectives %I 24 %V 24 %P 161-82 %G eng %U URL:http://www.aeaweb.org/jep/ Publisher's URL %N 1 %4 Personal Finance/Information and Market Efficiency/Event Studies/Retirement Policies/Older Workers/Retirement/Stock Market %$ 22160 %R 10.1257/jep.24.1.161 %0 Thesis %D 2010 %T Women's alternative retirement transition options: Social Security retirement benefits and employment status %A Gillen, Martie %K Adult children %K Employment and Labor Force %K Healthcare %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %K Social Security %K Women and Minorities %X The purpose of this dissertation is to examine two common measures of retirement status: (1) receipt of Social Security retirement benefits and (2) employment status. A three manuscript format was used to report the effects of human capital characteristics (education, marital status, and health status), types of income sources (pension income, IRA/annuity income, investment asset income, and other income), and age on women's timing of Social Security retirement benefit receipt and employment status. Four waves of Health and Retirement Study (FIRS) data (2000, 2002, 2004, and 2006) were used in the analyses. Manuscript 1 used longitudinal data to investigate alternative retirement options based on timing of Social Security benefit receipt and employment status. A majority of women chose early receipt of benefits compared to normal or delayed receipt. A greater percentage of women who did not receive Social Security benefits were employed compared to those who received benefits. Among women employed full-time; a large percentage did not receive Social Security benefits while a large percentage of women employed part-time received benefits. Manuscript 2 used cross-sectional data to focus on timing of receipt of Social Security retirement benefits. Less than excellent health and receiving pension income increased the likelihood of early receipt. Not being married and receiving income from earnings and unspecified income sources reduced the likelihood of early receipt. Manuscript 3 used cross-sectional data to estimate the likelihood of being employed. Having more years of education and being divorced/separated increased the likelihood; while poor/fair health, older age, receipt of Social Security benefits, and pension income reduced the likelihood of being employed. Additionally, manuscript 3 estimated the likelihood of full and part-time employment for women receiving Social Security benefits. Overall, this dissertation updates current knowledge regarding the complex options of timing of receipt of Social Security retirement benefits and employment options. %I University of Kentucky %C United States -- Kentucky %V Ph.D. %P 174 %G eng %U http://proquest.umi.com.proxy.lib.umich.edu/pqdweb?did=2575907951&Fmt=7&clientId=17822&RQT=309&VName=PQD %9 3492801 %4 Human Capital %$ 62862 %! Women's alternative retirement transition options: Social Security retirement benefits and employment status %0 Report %D 2009 %T Actual and Anticipated Inheritance Receipts %A Norma B Coe %A Anthony Webb %K Adult children %K Consumption and Savings %K Net Worth and Assets %X Using data from the Health and Retirement Study, we compare actual inheritances received during the period 1994 to 2004 with the amounts that, in 1994, households anticipated receiving within 10 years. We find little evidence of systematic forecasting errors. The factors affecting inheritance receipt also affect expectation formation. Although the distribution is highly skewed, inheritances are generally modest in amount and uncorrelated with lifetime income, and therefore have almost no effect on various measures of inequality. We find no evidence that households anticipating receipt of an inheritance save less than that of similar households, although this could reflect unobserved heterogeneity in tastes for saving. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/actual-and-anticipated-inheritance-receipts/ %4 household income/savings/wills/inheritance %$ 22090 %0 Report %D 2009 %T Buffering Shocks to Well-Being Late in Life %A Matthew D. Shapiro %K Consumption and Savings %K Net Worth and Assets %K Women and Minorities %X Consumption provides a comprehensive measurement of economic well-being. This research shows that consumption is well-insured with respect to health status and widowing. Using data from the Health and Retirement Study (HRS) and its CAMS supplement, it shows that consumption responds little to changes in health status even though adverse health generates substantial out-of-pocket medical expenses. Similarly, the effect of widowing on consumption, though substantial, is not strongly driven by changes in economic resources. Men experience little loss of monetary resources when being widowed. Women have the same overall loss in consumption as men when being widowed despite greater declines in economic resources. Hence, despite the adverse consequences for income and wealth for female widows, women experience no greater drop in consumption from losing a spouse than do men. %I University of Michigan %G eng %4 consumption/WOMEN/Widowhood %$ 26140 %0 Report %D 2009 %T Cross-Wave Prospective Social Security Wealth Measures of Pre-Retirees, Public Release: Data Description and Usage %A Kandice Kapinos %A Charles Brown %A Michael A. Nolte %A Helena Stolyarova %A David R Weir %K Net Worth and Assets %K Social Security %X The Prospective Social Security Wealth Measures of Pre-Retirees data set consists of respondent-level, cross-sectional files constructed from the employment sections of the HRS 1992 (wave 1), HRS 1998 (wave 4), HRS 2004 (wave 7) and the restricted SSA summary and detailed earnings and benefits files. In this public use file, we calculate wealth only for individuals who have not yet retired (as evidenced by claiming SS benefits) (see Section III.C). Each individual is uniquely identified by the concatenation of the household ID and the person number, HHID and PN. We organize the data to match the organization of the RAND HRS data files. %I Institute for Social Research, University of Michigan %C Ann Arbor, Michigan %G eng %4 social Security/wealth %$ 62780 %0 Book Section %B Developments in the economics of aging %D 2009 %T The Effect of Large Capital Gains or Losses on Retirement %A Michael D Hurd %A Reti, Monika %A Susann Rohwedder %E David A Wise %K Net Worth and Assets %K Retirement Planning and Satisfaction %B Developments in the economics of aging %I University of Chicago Press %C Chicago %P 127-172 %@ 0-226-90335-4 %G eng %U https://www.nber.org/books-and-chapters/developments-economics-aging/effect-large-capital-gains-or-losses-retirement %4 Early Retirement/Wealth Accumulation/Stock Market %$ 24170 %& 4 %0 Journal Article %J Hallym International Journal of Aging %D 2009 %T Effects of Human Capital on the Likelihood of Working in Later Life %A Lee, Yoon G. %A Susan L. Brown %K Demographics %K Employment and Labor Force %K Net Worth and Assets %X Using data from the 2004 Health and Retirement Study (HRS), this study attempted to profile individuals in the work force in later life and examined the effects of human capital and other socioeconomic factors on the likelihood of working in later life among individuals aged 65 or older. The results of the logistic regression analysis indicated that individuals with more education, more work experience, in better health, at young ages, who were male, and who were unmarried were more likely to work in the labor force past the age of 65. This study concluded that human capital factors, such as formal education, work experience, and health had significant impacts on the likelihood of individuals working in later life. Implications and conclusions were drawn based on the findings of the study. %B Hallym International Journal of Aging %I 11 %V 11 %P 155-172 %G eng %N 2 %4 aging population/human capital/labor force participation/older workers %$ 21850 %0 Report %D 2009 %T Evaluating Micro-Survey Estimates of Wealth and Saving %A Barry Bosworth %A Smart, Rosanna %K Adult children %K Consumption and Savings %K Net Worth and Assets %X This paper presents an overview of changes in household wealth accumulation and saving using wealth data from three micro-level surveys: Survey of Consumer Finances (SCF), Panel Study of Income Dynamics (PSID), and Health and Retirement Study (HRS). We provide comparisons to the macroeconomic estimates of wealth accumulation and saving, explore problems in constructing household-level valuations of wealth, and assess the value of using household-level datasets to examine wealth accumulation and saving behavior in the United States. Our first analysis compares the macroeconomic estimates of wealth from the Flow of Funds to comparable measures from the SCF, PSID and HRS. The Flow of Funds and SCF valuations of net worth correspond closely up to 1998. Yet, after1998, the SCF reports a much more rapid acceleration of wealth, concentrated in equity-type assets. The estimates of wealth in the PSID and HRS are very similar to the SCF for the bottom 95 percent of the wealth distribution, diverging only for the top five percent of households. Second, we evaluate the extent of bias in the wealth estimates that may have developed in the longitudinal surveys due to attrition. We conclude that both surveys remain very representative of the underlying population as judged by a comparison with the lower 95 percent of households in the SCF. We also use the longitudinal data to estimate the relationship between wealth and mortality, and adjustment factors for differential mortality that can be used to adjust the age-wealth profile obtained from cross-sectional surveys, such as the SCF. The result is greater evidence of wealth decumulation at older ages. Finally, we use the panel nature of the PSID and HRS to construct household-level measures of wealth accumulation and partition those changes between the contribution of new saving and valuation changes. The overall changes in wealth match the macroeconomic data closely, showing a secular rise in wealth-income ratios. Although the measures of saving do demonstrate consistent differences in saving among major socio-economic groups, they do not reflect the general decline in saving rates that is apparent in the aggregate data for the past two decades. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/evaluating-micro-survey-estimates-of-wealth-and-saving/ %L newpubs20090908_CRR2009-4 %4 Wealth Accumulation/Saving/Households %$ 20610 %0 Report %D 2009 %T Financial Literacy and Financial Sophistication Among Older Americans %A Annamaria Lusardi %A Olivia S. Mitchell %A Vilsa Curto %K Consumption and Savings %K Net Worth and Assets %K Retirement Planning and Satisfaction %X 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. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge, MA %G eng %L newpubs20091202_w15469.pdf %4 Financial Management/Portfolio Choice/Retirement planning/Retirement Saving %$ 21430 %R 10.3386/w15469 %0 Thesis %D 2009 %T Financial resources, Living Arrangements and Private Transfers %A Ma, Qiufei %K Adult children %K Net Worth and Assets %X In the first part, we investigate the role of children's characteristics, primarily wealth and wages, in determining coresidency outcomes using data collected as part of the Health and Retirement Study. We find that the effect of children's wealth and wages is highly non-linear: primarily found at the lower end of the distribution and inexistent elsewhere. We show that this is best explained by children being helped by parents rather than providing help themselves. Second, we show that omitting one of the children or parent's SES variables tends to overestimate the relationship between SES of the remaining member and coresidency outcomes. Together these two results highlight the value of considering rich information on characteristics of both parents and children when investigating the determinants of coresidency. In the second part, we analyze new intergenerational transfer data that has recently become available in the Chinese Social Survey of Family Dynamics (CSSFD) and assess whether or not it is useful to measure family support. In particular, we analyze the relationship between income and transfers in urban and rural areas. We argue that a social security pension system could not be effective without paying attention to its crowding out effect on intergenerational private transfers. In the third part of the dissertation, we analyze the determinants of financial and time transfers from adult children to their elderly parents in rural areas using the matched sample from the 2002 Chinese Social Survey of Family Dynamics (CSSFD) and the 2002 Chinese Longitudinal Healthy Longevity Survey (CLHLS). This is the first survey containing rich private transfers information in China. We find that wealthy children are more likely to give money transfers and give more; poor parents are more likely to receive money transfers and receive more. Interestingly, we also find that children and parental income are uncorrelated with time transfers. The evidence suggests that money transfers are more determined by children's financial status, while time transfers respond strongly to parental need. Results highlight the existence of strong private transfers from adult children to their elderly parents in rural China. %I The Pardee RAND Graduate School %C Santa Monica, CA %G eng %U https://www.rand.org/pubs/rgs_dissertations/RGSD241.html %4 Family transfers, structure %$ 20470 %0 Thesis %D 2009 %T Health Events, Household Wealth and Debt Holdings: Evidence from the health and retirement study %A Patryk D. Babiarz %K Adult children %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %X The dissertation is composed of three independent studies that examine the effects of health events on household wealth, debt holdings and health investment behavior. The first study investigates the role of the unsecured credit market as a potential mechanism for intertemporal transfers of income in times of financial hardship caused by health adversities. The ability to borrow through unsecured markets is especially important to households with low financial assets. Unfortunately, households with low financial assets have been previously characterized as particularly likely to face borrowing constraints. However, recent improvements in accessibility and generosity of credit markets can mitigate the borrowing constraints of these households. Results show that the onset of an adverse health condition is associated with an average of 9 percent increase of unsecured debt. This effect is not uniform across households. Families in the bottom quartile of financial assets borrow considerably more than households with above median financial assets. The second study builds on the theory of precautionary saving which predicts that uncertainty of future depresses consumption and increases the accumulation of wealth. This emergency wealth creates a safety net against income shocks or unexpected expenditures, such as catastrophic healthcare charges. The ownership of health insurance reduces the risk of unexpected healthcare costs. Therefore, the ownership of health insurance should reduce the strength of the precautionary saving motive. The goal of the second study is to investigate whether Medicare enrollment and household asset accumulation patterns are consistent with the theory of precautionary saving. Medicare eligibility is exogenously determined using age of the insured. Thus, Medicare enrollment does not correlate with other household characteristics that determine precautionary wealth accumulation and ownership of other types of health insurance. Findings show that non-retirement financial assets of households enrolled in Medicare are over 10 percent lower compared to households without Medicare. The third study examines returns to preventive healthcare expenditures and preventive behaviors. It is widely believed that by engaging in preventive behaviors and purchasing preventive medical services individuals reduce the probability of the future outbreak of an adverse health condition and in consequence lower future healthcare costs. Building on the assumption that the share of preventive expenditures in total out-of-pocket expenditures is higher for individuals who are in good health, the study concludes that past preventive healthcare expenditures reduce the rate of growth of future healthcare expenditures and produce favorable health outcomes. %I Purdue University %C United States, Indiana %8 2009 %G eng %U https://www.researchgate.net/publication/40735984_Health_events_household_wealth_and_debt_holdings_Evidence_from_the_health_and_retirement_study %4 Precautionary Saving %$ 21640 %! Health Events, Household Wealth and Debt Holdings: Evidence from the health and retirement study %0 Journal Article %J Journal of Risk and Insurance %D 2009 %T Housing, Health, and Annuities %A Davidoff, Thomas %K Consumption and Savings %K Demographics %K Healthcare %K Net Worth and Assets %K Other %X Abstract Annuities, long-term care insurance (LTCI), and reverse mortgages appear to offer important consumption smoothing benefits to the elderly, yet private markets for these products are small. A prominent idea is to combine LTCI and annuities to alleviate both supply (selection) and demand (liquidity) problems in these markets. This article shows that if consumers typically liquidate home equity only in the event of illness or very old age, then LTCI and annuities become less attractive and may become substitutes rather than complements. The reason is that the marginal utility of wealth drops when an otherwise illiquid home is sold, an event correlated with the payouts of both annuities and LTCI. Simulations confirm that demand for LTCI and annuities is highly sensitive to the liquidity and magnitude of home equity. %B Journal of Risk and Insurance %I 76 %V 76 %P 31-52 %G eng %N 1 %4 long Term Care/Annuities/Financial planning/Personal finance/Older people/Home equity loans/Reverse mortgages/Leasebacks %$ 25320 %R 10.1111/j.1539-6975.2009.01287.x %0 Journal Article %J Review of Income and Wealth %D 2009 %T How Household Portfolios Evolve after Retirement: The Effect of Aging and Health Shocks %A Courtney Coile %A Kevin Milligan %K Net Worth and Assets %X We study how the portfolios of U.S. households evolve after retirement, using data from the Health and Retirement Study (HRS). In particular, we investigate the influence of aging and health shocks on a household's ownership of various assets and on the share of total assets held in each asset class. We find that households decrease their ownership of principal residences, vehicles, financial assets, businesses, and real estate as they age, while increasing the share of assets held in liquid assets and time deposits. We find that widowhood and other health shocks are associated with the same kinds of portfolio changes, and that the effect of shocks strengthens with time since the shock. Finally, we show that the effect of a shock is greatly magnified when households have physical or mental impairments. This suggests that factors other than standard risk and return considerations weigh heavily in many older households' portfolio decisions. %B Review of Income and Wealth %I 59 %V 59 %P 226-248 %G eng %N 2 %4 Retirement Wealth/Portfolio Choice/Assets/asset choice %$ 20720 %R 10.1111/j.1475-4991.2009.00320.x %0 Report %D 2009 %T How Seniors Change Their Asset Holdings During Retirement %A Karen E. Smith %A Soto, Mauricio %A Penner, Rudolph %K Demographics %K Net Worth and Assets %K Public Policy %X We use the 1998-2006 waves of the Health and Retirement Study (HRS) to investigate how households change their asset holdings at older ages. We find a notable increase in the net worth of older households between 1998 and 2006, with most of the growth due to housing. Our results indicate that, through 2006, older households did not spend all of their capital gains. This asset accumulation provides older households with a financial cushion for the turbulence experienced after 2007. The wealth distribution is highly skewed, and the age patterns of asset accumulation and decumulation vary considerably by income group. High-income seniors increase assets at older ages. Middle-income seniors reduce their assets in retirement, but at a rate that for most seniors will not deplete assets within their expected life. Many low-income seniors accumulate fewer assets and spend their financial assets at a rate that will mostly deplete them at older ages, leaving low-income seniors with only Social Security and DB pension income at older ages. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/how-seniors-change-their-asset-holdings-during-retirement/ %4 Net Worth/asset accumulation/socioeconomic Status/wealth distribution %$ 22080 %0 Report %D 2009 %T The Long-Term Financial and Health Outcomes of Disability Insurance Applicants %A Kathleen McGarry %A Jonathan S Skinner %K Disabilities %K Healthcare %K Insurance %K Net Worth and Assets %I 11th Annual Joint Conference of the Retirement Research Consortium %G eng %4 DISABILITY/DISABILITY/health outcomes/financial outcomes/financial outcomes/Insurance %$ 26010 %0 Thesis %D 2009 %T The mediating effects of the sense of control on the financial well-being of older adults %A Karen A. Zurlo %K Demographics %K Methodology %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X Statement of the problem. The financial well-being of the older adult population has improved over the past few decades, but the outlook for future generations is not positive. As government and employers become less accountable for the provision of retirement income, adults are required to take greater responsibility for their financial circumstances as they age, yet they often have neither the skills nor ability to exercise this control. By not exercising adequate control over their different aspects of their lives, adults may be exposed to financial risk in retirement. Methods. A cross-sectional, quantitative analysis using survey data from two components of the Health and Retirement Study (HRS), the HRS Rand Data files and the Psychosocial Leave-Behind Participant Lifestyle Questionnaire, was conducted. These surveys were administered in 2006 to a sample of 7,549 adults over the age of 50 and merged to conduct this analysis. Statistical analyses used multi-stage statistical modeling to test the mediating effects of the general sense of control and domain-specific levels of control, also known as control beliefs, on the relationship between the general attributes of older adults and their financial well-being. Financial well-being was measured as financial satisfaction and wealth. Results. The control beliefs of older adults significantly influence the size and magnitudes of the linkages between their demographic attributes and financial outcomes. Control beliefs boosted explained variance in financial satisfaction by over 70 percent and they increased explained variance in wealth by 4.5 percent. The mediation analyses were consistent with these results. Conclusion. Control beliefs are more strongly influential over older adults' sense of financial satisfaction than on their actual wealth levels. Accordingly, interventions that influence peoples' sense of control may enhance their felt well-being but will be less influential on levels of wealth. This study can be considered the first of its kind to use the psychological construct of sense of control as a mediating factor on the relationship between the attributes of older adults and self-assessed financial satisfaction as well as actual wealth outcomes. In this way we contribute to the newly developing research stream evaluating the determinants of self-reported happiness. %I University of Pennsylvania %V Ph.D. %P 228 %G eng %U http://proquest.umi.com.proxy.lib.umich.edu/pqdweb?did=1956000501&sid=1&Fmt=2&clientId=17822&RQT=309&VName=PQD %9 Dissertation %4 Retirement %$ 23140 %! The mediating effects of the sense of control on the financial well-being of older adults %0 Report %D 2009 %T Mode and Context Effects in Measuring Household Assets %A Arthur H.O. vanSoest %A Arie Kapteyn %K Demographics %K Methodology %K Net Worth and Assets %X Differences in answers in Internet and traditional surveys can be due to selection, mode, or context effects. The authors exploit unique experimental data to analyze mode and context effects controlling for arbitrary selection. The Health and Retirement Study (HRS) surveys a random sample of the US 50 population, with CAPI or CATI core interviews once every two years. In 2003 and 2005, random samples were drawn from HRS respondents in 2002 and 2004 willing and able to participate in an Internet interview. Comparing core and Internet survey answers of the same people, the authors analyze mode and context effects, controlling for selection. They focus on household assets, for which mode effects in Internet surveys have rarely been studied. They find some large differences between the first Internet survey and the other three surveys which they interpret as a context and question wording effect rather than a pure mode effect. %I RAND Corporation Publications Department Working Papers: 668 %G eng %U URL:http://www.rand.org/pubs/working_papers/2009/RAND_WR668.pdf URL %4 Methodology/Microeconomic Data Management/Field Experiments/assets/Household %$ 22130 %0 Report %D 2009 %T Mode and Context Effects of Measuring Household Assets %A Arthur H.O. vanSoest %A Arie Kapteyn %K Methodology %K Net Worth and Assets %X Differences in answers in Internet and traditional surveys can be due to selection, mode, or context effects. We exploit unique experimental data to analyze mode and context effects controlling for arbitrary selection. The Health and Retirement Study (HRS) surveys a random sample of the US 50 population, with CAPI or CATI core interviews once every two years. In 2003 and 2005, random samples were drawn from HRS respondents in 2002 and 2004 willing and able to participate in an Internet interview. Comparing core and Internet survey answers of the same people, we analyze mode and context effects, controlling for selection. We focus on household assets, for which mode effects in Internet surveys have rarely been studied. We find some large differences between the first Internet survey and the other three surveys which we interpret as a context and question wording effect rather than a pure mode effect. %I Tilburg University, Center for Economic Research, Discussion Paper 2009-14 %G eng %4 Survey Methods/Measurement/Assets %$ 20530 %0 Journal Article %J The American Review of Public Administration %D 2009 %T The Myth of the Coming Charitable Estate Windfall %A Russell N. James III %K Adult children %K Net Worth and Assets %X Media accounts, fund-raising periodicals, and some academic research have pointed to a coming windfall of charitable estate transfers driven by the graying of the population. Nonprofit managers and public agencies working with nonprofits or their beneficiaries may incorporate these expectations into their long-range planning. This article presents the first comparison of estate gifts (for both taxable and nontaxable estates) with the previous annual giving and volunteering of the deceased. An analysis of approximately 6,000 deceased panel members from the 1995 2006 Health and Retirement Study suggests that estate gifts are largely offset by the loss of current giving and volunteering previously provided by the deceased donors. Consequently, nonprofit managers who plan based on anticipated future charitable giving estate windfalls may make erroneous choices. %B The American Review of Public Administration %I 39 %V 39 %P 661-674 %G eng %N 6 %L newpubs20091202_Myth.pdf %4 Bequests/financial resources %$ 21360 %R https://doi.org/10.1177/0275074008326188 %0 Journal Article %J Journal of Applied Gerontology %D 2009 %T Older Women and Poverty Transition: Consequences of Income Source Changes From Widowhood %A Gillen, Martie %A Hyungsoo Kim %K Income %K Net Worth and Assets %X Older single women are disproportionately vulnerable to poverty. Using data from the 2002 and 2004 waves of the Health and Retirement Study of 5,799 women age 65 or older, this study investigated the effect of change in income sources by recent spousal loss on poverty transition. The focus is on (a) the effect of widowhood on income source change and (b) how such change affects poverty transition of recently widowed older women. Findings indicate that widowhood greatly decreases income from every source. Specifically, a 10 increase in social security benefits decreased the probability of poverty transition for recently widowed older women by 67.2 . These findings call for reconsidering social security survivor benefit rules and women's education with regard to financial security in retirement. %B Journal of Applied Gerontology %I 28 %V 28 %P 320-341 %G eng %N 3 %L newpubs20090908_GillenKim.pdf %4 Widowhood/Poverty/income %$ 20430 %R https://doi.org/10.1177/0733464808326953 %0 Report %D 2009 %T Portfolio Choice in Retirement: Health Risk and the Demand for Annuities, Housing and Risky Assets %A Yogo, Motohiro %K Health Conditions and Status %K Methodology %K Net Worth and Assets %X This paper develops a consumption and portfolio-choice model of a retiree who allocates wealth among four assets: a riskless bond, a risky asset, a real annuity, and housing. Unlike previous studies that treat health expenditures as exogenous negative income shocks, this paper builds on the Grossman model to endogenize health expenditures as investments in health. I calibrate the model to explain the joint evolution of health status and the composition of wealth for retirees, aged 65 to 96, in the Health and Retirement Study. I use the calibrated model to assess the welfare gains of an actuarially fair annuity market. The welfare gain is less than 1 of wealth for the median-health retiree at age 65, and the welfare gain is about 10 of wealth for the healthiest. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/portfolio-choice-in-retirement-health-risk-and-the-demand-for-annuities-housing-and-risky-assets/ %L newpubs20090908_CRR2009-3 %4 Wealth/Portfolio Choice/Health Expenditures/Models, Theoretical %$ 20600 %0 Report %D 2009 %T Retirement Wealth Across Cohorts: The Role of Earnings Inequality %A Ann H. Stevens %K Demographics %K Employment and Labor Force %K Net Worth and Assets %K Public Policy %K Social Security %X Changes in labor markets over the past 30 years suggest upcoming changes in the distribution of wealth at retirement. Workers from the baby boom cohort have spent the majority of their working years in a labor market with substantially higher earnings inequality than previous generations. This paper investigates how changes in lifetime earnings distributions affect the distribution of retirement wealth among cohorts retiring over the next decade. I use data from the Health and Retirement Study from 1992 to 2004 to estimate the relationship between lifetime earnings, pre-retirement private wealth and Social Security wealth. I show that changes in the lower half of the male earnings distribution explain a substantial portion of changes in the distribution of pre-retirement wealth. When pensions are added to the measure of wealth, the role of earnings is even larger, reflecting a strong correlation between changes in earnings across these cohorts and changes in the values of their employer-provided pensions. The present value of wealth from future Social Security benefits, in contrast, grows in real terms throughout most of the distribution. At the bottom of the male distribution of Social Security wealth, reductions in lifetime earnings limit this growth in real benefits, while at the top of the distribution earnings growth amplifies expected growth in Social Security wealth. %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://mrdrc.isr.umich.edu/pubs/retirement-wealth-across-cohorts-the-role-of-earnings-inequality-and-pension-changes/ %4 early boomers/labor Market/lifetime earnings/lifetime earnings/wealth/Social Security/public Policy %$ 26150 %0 Thesis %D 2009 %T Socioeconomic status and health redux: New evidence from England in a comparative context %A Caswell, Kyle J. %Y Starr, Martha A. %K Cross-National %K Demographics %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Other %K Public Policy %X People with higher socioeconomic status (SES) enjoy superior health. For the US, it is especially difficult to identify pathways underpinning this relationship, as it likely reflects differences in access to health care in addition to other factors correlated with SES. In England, however, access to care is universal, so that if SES is positively correlated with health, its main effects must come via alternative pathways other than access to care. This dissertation investigates the effects of SES on health outcomes, and vice versa, using the English Longitudinal Study of Ageing (ELSA). As the ELSA is similar to the US Health and Retirement Study, I compare the SES-health relation between countries. I find that the effect of SES on health is significant in England, with wealth the most important in guarding against negative health outcomes. However, for lower SES individuals, there are important differences between countries, suggesting that access to care has its largest effect among the least advantaged. Furthermore, new health events affect the economic resources of English individuals less than their US counterparts. Finally, there is evidence among married couples that wives respond to their husbands' new health conditions by increasing market labor hours--i.e., an 'added worker effect.' %I The American University %C Washington, D.C. %V Ph.D %P 166 %G eng %9 Dissertation %4 cross-national comparison %$ 23130 %! Socioeconomic status and health redux: New evidence from England in a comparative context %0 Report %D 2009 %T Stock Market Expectations and Portfolio Choice of American Households %A Kezdi, Gabor %A Robert J. Willis %K Expectations %K Methodology %K Net Worth and Assets %K Risk Taking %X This paper measures heterogeneity in the stock market expectations of households using survey answers to probability questions. We address survey measurement error in an explicit way and develop a joint model of the effect of expectations on portfolio choice on the one hand and survey answers on the other hand. The model is consistent with documented features of measurement error. We show substantial heterogeneity and that heterogeneity in expectations predicts heterogeneity in stockholding. We show that a general tendency to be optimistic is related to optimism about stock returns and in turn increases stockholding, while a general tendency to be uncertain is strongly related to uncertainty about stock market returns and in turn decreases stockholding. We estimate the level of risk tolerance that links subjective beliefs to stockholding to be moderate. We also show that a significant part of stockholding differences among demographic groups is explained by differences in their expectations. %I University of Michigan %G eng %U http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.506.1967&rep=rep1&type=pdf %4 subjective expectations/survey measurement/household finances/Stock Market/expectations/risk tolerance %$ 23500 %0 Thesis %D 2009 %T Three Essays in Labor Economics %A Bricker, Jesse %K Demographics %K Employment and Labor Force %K Net Worth and Assets %X This dissertation consists of three essays in labor economics. Two main themes run through the essays: the development of human capital and the quality of economic data. The first essay reports on the impact of mis-measured data on the point estimates found from OLS regression. The second essay reports on changes over time in quantitative human capital. The third essay investigates how absences in high school can influence long-term education outcomes. This final essay blends the themes found in the first two essays by (1) using high quality administrative high school transcripts data and (2) exploring effects on human capital accumulation. The first essay, co-authored with Gary Engelhardt, provides new evidence on the extent of measurement error in respondent-reported earnings data by exploiting detailed W-2 records matched to older workers in the Health and Retirement Study (HRS). The empirical findings are qualitatively consistent with previous studies. Mean measurement error in the 1991 earnings data for men from the Original Cohort of the HRS is somewhat larger than what has been found in other validation studies, but is still modest. There is a negative correlation between the measurement error and the true value of earnings as measured by the W-2 records, which indicates the presence of non-classical measurement error. However, for men and women, this error shows little correlation with a standard set of cross-sectional earnings determinants. The second essay examines changes over time in quantitative human capital. Historically, part of the gender gap in quantitative investments was due to a gap in pre-college quantitative skills. Using the 1979 and 1997 cohorts of the National Longitudinal Survey of Youth (NLSY) I show that the pre-college quantitative skills gap between young men and women today is smaller than in the past. Then, by semi-parametrically reweighting the NLSY79 to have the characteristics of the NLSY97 I predict that the fraction of young women in quantitative fields should double. In fact, though, the allocation is virtually unchanged across the cohorts. The third essay, co-authored with Kalena Cortes and Chris Rohlfs, is a study that measures the effects of classroom absences on high school course grades and completion. Using a unique dataset of transcript files from Chicago Public High Schools, we address two interrelated questions: Does absenteeism in specific subject areas ( i.e. , Mathematics or English) affect student course grades and dropout rates? Because attendance and absences are not randomly assigned across students, those with particularly high rates of absenteeism are likely to have less motivation and ability than the typical student. We address this problem by employing a quasi-experimental research design based on the essentially random ordering of classes over the course of the day. This research design makes it possible to disentangle the causal effect of absenteeism from motivation, ability, and other determinants of academic performance. In estimating the effects of absenteeism on dropping out, we address the nonrandom selection problem by conducting two-stage least squares analysis, where the exogenous variation in course scheduling is used to instrument for student absenteeism. %I Syracuse University %C United States, New York %8 2009 %G eng %4 Education %$ 21670 %! Three Essays in Labor Economics %0 Journal Article %J Journal of Family and Economic Issues %D 2009 %T Wealth Holdings and Portfolio Allocation of the Elderly: The role of marital history %A Ulker, Aydogan %K Adult children %K Net Worth and Assets %X This paper investigates the role of marital history in terms of explaining differences in wealth holdings and portfolio allocation of older individuals by studying data from the first wave of Health and Retirement Study which was conducted in 1992. The results generally suggest that both men and women suffer from the negative shocks of past marital dissolutions in terms of household wealth accumulation. The significance level, however, differs across currently married couples, single males, and single females. The examination of the asset components of net worth also indicates that both the probability of owning a particular asset and the fraction of wealth allocated to that asset might vary depending on the elderly individuals marital history. %B Journal of Family and Economic Issues %I 30 %V 30 %P 90 %G eng %N 1 %L newpubs20090302_Ulker_JFEI.pdf %4 Marital History/Wealth/Portfolio Choice %$ 19780 %R https://doi.org/10.1007/s10834-008-9139-2 %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 %0 Journal Article %J Financial Counseling and Planning %D 2009 %T Wills, Trusts, and Charitable Estate Planning: A panel study of document effectiveness %A Russell N. James III %K Adult children %K Net Worth and Assets %X This paper compares pre-death charitable testamentary expectations with post-death distributions for deceased panel members in the 1995-2006 Health and Retirement Study. Most respondents who reported having a charitable estate plan in the survey wave immediately prior to their death ultimately generated no charitable estate gift after death. Cross-tabulations, linear probability models, and probit analysis all demonstrated that the likelihood of generating a charitable estate gift was significantly higher for respondents who had a funded inter vivos trust than for respondents who had only a will. This difference persisted even after controlling for wealth, income, and other demographic differences. Reasons for the differential effectiveness of these planning documents and implications for financial and gift planners are examined. %B Financial Counseling and Planning %I 20 %V 20 %P 3-14 %G eng %N 1 %L newpubs20091202_FCParticle.pdf %4 financial resources/Bequests/Estate Values %$ 21350 %0 Report %D 2008 %T Adequacy of Economic Resources in Retirement and Returns-to-scale in Consumption %A Michael D Hurd %A Susann Rohwedder %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %X Most assessments of the adequacy of retirement resources are expressed as a comparison of preretirement income to immediate post-retirement income. Yet, among couples a substantial fraction of retirement years is eventually spent by the surviving spouse living alone. To the extent that singles need less than couples to maintain the same standard of living, assessments of the adequacy of economic resources that make no adjustment for widowing will systematically misstate economic preparation. We estimate returns-to-scale parameters in spending by older households, using data from the Consumption and Activities Mail Survey and apply these to assessments of adequacy of retirement resources. %I The University of Michigan, Michigan Retirement Research Center %G eng %U http://www.mrrc.isr.umich.edu/publications/papers %L newpubs20080822_wp174 %4 Retirement Wealth/Consumption/Survivors %$ 19260 %0 Journal Article %J Environmental and Resource Economics %D 2008 %T Complementarity and the Measurement of Individual Risk Tradeoffs: Accounting for Quantity and Quality of Life Effects %A Mary F. Evans %A V. Kerry Smith %K Employment and Labor Force %K Net Worth and Assets %X This paper considers the factors responsible for differences with age in estimates of the wage compensation an individual requires to accept increased occupational fatality risk. We derive a relationship between the value of a statistical life (VSL) and the degree of complementarity between consumption and labor supplied when health status serves as a potential source of variation in this relationship. Our empirical analysis finds that variations in an individual s health status or quality of life and anticipated longevity threats lead to significant differences in the estimated wage/risk tradeoffs. We describe how extensions to the specification of hedonic wage models, including measures for quality of life and anticipated longevity threats, help to explain the diversity in past studies examining how the estimated wage risk tradeoff changes with age. %B Environmental and Resource Economics %I 41 %V 41 %P 381-400 %G eng %U http://dx.doi.org/10.1007/s10640-008-9197-9 %N 3 %4 Business and Economics/Wages %$ 25430 %R 10.1007/s10640-008-9197-9 %0 Journal Article %J Journal of Family and Economic Issues %D 2008 %T Credit Constraints and Human Capital Investment in College Education %A Cao, Honggao %K Demographics %K Income %K Net Worth and Assets %X Using data from the Health and Retirement Study 2001 Human Capital Investment Survey, this article examines the impact of credit market constraints on investment in college education. The effect of family income on college attendance may not be as big as perceived in some previous studies. The interest rates faced by children from middle families are the lowest in the credit market. The research suggests that various government programs aiming to help children from poor families may be effective, but only at the extensive margin--by improving their access to college education. For those who get into college, underinvestment by students from poor families remains a significant problem. %B Journal of Family and Economic Issues %I 29 %V 29 %P 41-54 %G eng %N 1 %L newpubs20080411_CaoJFEI.pdf %4 Education/Income Inequality/Human Capital %$ 18840 %0 Journal Article %J British Medical Journal (International Edition) %D 2008 %T Downward Trend in Dementia Linked to Better Education and Personal Wealth %A Hopkins Tanne, Janice %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X Cognitive decline is declining among Americans older than 70, a study of 11,000 elderly US residents carried out at the University of Michigan Medical School has found. The study showed that higher education and higher net financial worth protected against cognitive impairment. The authors used data from the Health and Retirement Study, a nationally representative, population based longitudinal study of US adults. %B British Medical Journal (International Edition) %I 336 %V 336 %P 466-7 %G eng %L newpubs20080528_BritMedJnl %4 Cognitive Functioning/Education/Wealth %$ 18980 %0 Report %D 2008 %T Forecasting Labor Force Participation and Economic Resources of the Early Baby Boomers %A Pierre-Carl Michaud %A Susann Rohwedder %K Demographics %K Employment and Labor Force %K Net Worth and Assets %K Pensions %X This paper forecasts the retirement patterns and resources of the Early Baby Boomers by estimating forward-looking dynamic models of labor force participation, wealth accumulation and pension and Social Security benefit claiming for older workers using seven waves of HRSdata. The two most important innovations of our proposed approach are the use of alternative measures of pension entitlements and the associated incentives, and accounting for subjective expectations about future work. Our main findings are that the Early Baby Boomers will work longer and claim Social Security later. %B University of Michigan Retirement Research Center Working Paper %I The University of Michigan Retirement Research Center %C Ann Arbor, MI %G eng %U https://deepblue.lib.umich.edu/handle/2027.42/60324 %L newpubs20080822_wp175 %4 Labor Force Participation/Wealth Accumulation/Pensions/Baby Boomers %$ 19250 %0 Report %D 2008 %T How Well Do Individuals Predict the Selling Prices of Their Homes? %A Hugo Benítez-Silva %A Selçuk Eren %A Frank Heiland %A Jimenez-Martin, Sergi %K Housing %K Net Worth and Assets %X Self-reported home values are widely used as a measure of housing wealth by researchers employing a variety of data sets and studying a number of different individual and household level decisions. The accuracy of this measure is an open empirical question, and requires some type of market assessment of the values reported. In this research, we study the predictive power of self-reported housing wealth when estimating sales prices utilizing the Health and Retirement Study. We find that homeowners, on average, overestimate the value of their properties by between 5 and 10 . We also find a strong correlation between accuracy and the economic conditions (measured by the prevalent interest rate, the growth of household income, and the growth of median housing prices) at the time of the purchase of the property. While most individuals overestimate the value of their properties, those who bought during more difficult economic times tend to be more accurate, and in some cases even underestimate the value of their house. This cyclicality of the overestimation of house prices can provide some clues regarding the reasons for the difficulties currently faced by many homeowners. %B Levy Economics Institute Working Paper %I The Levy Economics Institute %C New York, New York %G eng %L newpubs20080908_fedea2008-10.pdf %4 Housing Equity/Wealth %$ 20990 %R http://dx.doi.org/10.2139/ssrn.1107165 %0 Journal Article %J Journal of Population Economics %D 2008 %T A Longitudinal Analysis of the Impact of Health Shocks on the Wealth of Elders %A Jinkook Lee %A Hyungsoo Kim %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X We investigate the impact of health shocks on wealth, using all four waves of the Health and Retirement Study, and estimate not only the short-term effect but also the long-term effect of health shocks on wealth of the elderly. We find that new health events lower wealth in elders during the period in which such health shocks occur, but the impact tends to disappear over time. We also find that health shocks result in greater wealth depletion when they occur later in life. Together with existing health problems, the overall impact of health problems on wealth increases over time. %B Journal of Population Economics %I 21 %V 21 %P 217-230 %G eng %N 1 %L newpubs20080229_fulltext.pdf %4 Elderly/Health Shocks/Wealth %$ 18510 %R https://doi.org/10.1007/s00148-007-0156-5 %0 Journal Article %J Journal of Risk and Insurance %D 2008 %T Mortality, Heterogeneity and the Distributional Consequences of Mandatory Annuitization %A Gong, Guan %A Anthony Webb %K Demographics %K Expectations %K Health Conditions and Status %K Net Worth and Assets %X This article investigates the distributional consequences of mandatory annuitization. Using data from the Health and Retirement Study (HRS), we calculate the relationship between socio-economic status and a utility based measure of annuity value. We find considerable variation between groups once we take account of not only socio-economic differences in mortality, but also pre-annuitized wealth and longevity risk pooling in marriage. Using HRS data on subjective survival probabilities, we then construct a subjective life table for each individual in the HRS. We show that these tables vary appropriately between groups and aggregate closely to group level averages. We calculate the value each household would place on annuitization, based on the husband and wife's subjective life tables, and the household's degree of risk-aversion and proportion of pre-annuitized wealth. A significant minority would perceive themselves as suffering a net loss from mandatory annuitization. %B Journal of Risk and Insurance %I 75 %V 75 %P 1055-79 %G eng %N 4 %L wp_2006/CRRwp2006-11.pdf %4 Annuities/socioeconomic status/mortality/Subjective Probabilities of Survival %$ 16640 %R https://doi.org/10.1111/j.1539-6975.2008.00297.x %0 Journal Article %J Review of Income and Wealth %D 2008 %T A New Look at the Wealth Adequacy of Older U.S. Households %A Love, David A. %A Paul A Smith %A McNair, Lucy C. %K Demographics %K Expectations %K Net Worth and Assets %X We construct two measures of the current wealth adequacy of older U.S. households using the 1998--2006 waves of the Health and Retirement Study (HRS). The first is the ratio of comprehensive wealth --defined as net worth plus the expected value of future income streams--to the wealth that would be needed to generate expected poverty-line income in future years. By this measure, we find that the median older U.S. household is reasonably well situated, with a poverty ratio of about 3.9 in 2006. However, we find that about 18 percent of households have less wealth than would be needed to generate 150 percent of poverty-line income over their expected future lifetimes. Our second measure is the ratio of the annuitized value of comprehensive resources to pre-retirement earnings. This measure identifies a median replacement rate of about 105 percent, with about 13 percent of households experiencing replacement rates of less than 50 percent. Comparing the leading edge of the baby boomers in 2006 to households of the same age in 1998, we find that the baby boomers show slightly less wealth, in real terms, than their elders did, and single boomers show a bit higher incidence of inadequacy than did their elders. Nonetheless, the median single boomer appears to have adequate resources. Moreover, we find a rising age profile of annualized wealth, even within households over time and after controlling for other factors, suggesting that older households are not spending their wealth as quickly as their survival probabilities are falling. %B Review of Income and Wealth %I 56 %V 56 %P 616-42 %G eng %U https://www.federalreserve.gov/econres/feds/a-new-look-at-the-wealth-adequacy-of-older-us-households.htm %N 4 %L newpubs20090302_LoveRIW.pdf %4 Wealth/Baby Boomers/Life Expectancy %$ 19920 %0 Journal Article %J The Journal of Consumer Affairs %D 2008 %T No Pain, No Strain: Impact of Health on the Financial Security of Older Americans %A Hyungsoo Kim %A Lyons, Angela C. %K Health Conditions and Status %K Net Worth and Assets %X This study uses data from the 2002 and 2004 Health and Retirement Study to investigate the impact that new and existing health problems have on the financial strain of older Americans. Two-period models are estimated for a series of financial ratio guidelines that take into account household solvency, liquidity, and investment asset accumulation. We test our models using a subjective measure of self-reported health status and two objective measures of health that control for the severity of specific health conditions. The results show that health problems significantly increase the likelihood of financial strain for older individuals, but the effects vary by the measure of financial strain used and how health status is defined. Specifically, existing health conditions were more likely to affect solvency and investment asset accumulation than liquidity, while new health events were more likely to affect solvency. The severity of the condition did not seem to matter as much as whether the condition was chronic. These results provide insight into the future financial security of older Americans and have important implications for health policy and research. %B The Journal of Consumer Affairs %I 42 %V 42 %P 9-36 %G eng %N 1 %L newpubs20080528_JnlConsAf.pdf %4 health status/financial resources %$ 18860 %R https://doi.org/10.1111/j.1745-6606.2007.00092.x %0 Journal Article %J Journal of Econometrics %D 2008 %T Partial Identification of Probability Distributions with Misclassified Data %A Molinari, Francesca %K Methodology %K Net Worth and Assets %X This paper addresses the problem of data errors in discrete variables. When data errors occur, the observed variable is a misclassified version of the variable of interest, whose distribution is not identified. Inferential problems caused by data errors have been conceptualized through convolution and mixture models. This paper introduces the direct misclassification approach. The approach is based on the observation that in the presence of classification errors, the relation between the distribution of the 'true' but unobservable variable and its misclassified representation is given by a linear system of simultaneous equations, in which the coefficient matrix is the matrix of misclassification probabilities. Formalizing the problem in these terms allows one to incorporate any prior information into the analysis through sets of restrictions on the matrix of misclassification probabilities. Such information can have strong identifying power. The direct misclassification approach fully exploits it to derive identification regions for any real functional of the distribution of interest. A method for estimating the identification regions and construct their confidence sets is given, and illustrated with an empirical analysis of the distribution of pension plan types using data from the Health and Retirement Study. %B Journal of Econometrics %I 144 %V 144 %P 81 %G eng %N 1 %L newpubs20080528_JnlEconoMet %4 Data Collection and Data Estimation Methodology/Classification errors/Distribution %$ 18900 %R https://doi.org/10.1016/j.jeconom.2007.12.003 %0 Report %D 2008 %T Pension Wealth and Income: 1992, 1998, and 2004 %A Sorokina, Olga %A Anthony Webb %A Muldoon, Dan %K Net Worth and Assets %K Pensions %X What is the impact of the shift from defined benefit to defined contribution plans on the pension wealth of households approaching retirement? Using data from the Health and Retirement Study, this brief documents this shift and compares employer-sponsored pension wealth across households with heads age 51-56 in 1992, 1998, and 2004. The results show that, for the average household, both pension wealth and replacement rates the ratio of annual benefits to pre-retirement earnings fell between 1992 and 2004. %B Center for Retirement Research at Boston College Briefs %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/briefs/pension-wealth-and-income-1992-1998-and-2004/ %L newpubs20080411_CRRJan08.pdf %4 Pension Wealth/defined benefits/defined contribution pension plans/Retirement Wealth %$ 18750 %0 Report %D 2008 %T Planning and Financial Literacy: How do women fare? %A Annamaria Lusardi %A Olivia S. Mitchell %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Women and Minorities %X 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. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA, %G eng %L newpubs20070125_Lusardi_wp136 %4 Retirement Planning/Financial Management/WOMEN %$ 17090 %R 10.3386/w13750 %0 Report %D 2008 %T Preparation for Retirement, Financial Literacy and Cognitive Resources %A Delavande, Adeline %A Susann Rohwedder %A Robert J. Willis %K Methodology %K Net Worth and Assets %X Traditional economic models assume that individuals have full information and act perfectly rationally. However, we show that there is considerable variation in financial literacy in the population and propose modeling the acquisition of financial knowledge in a human capital production framework. The model makes several predictions, notably with respect to portfolio choice. For example, it helps explain household non-participation in the stock market for some fraction of the population, and it provides guidance about the share of risky assets to hold for other types of households. Estimation of the human capital production function for financial knowledge on data from the Cognitive Economics Survey yields results that are consistent with important features of the model %B Michigan Retirement Research Center Research Working Paper %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://ideas.repec.org/p/mrr/papers/wp190.html %4 stock Market/Probabilistic expectations/Financial literacy %$ 23510 %0 Report %D 2008 %T The Trajectory of Wealth in Retirement %A Love, David A. %A Palumbo, Michael %A Paul A Smith %K Consumption and Savings %K Net Worth and Assets %X As the baby boomers begin to retire, a great deal remains unknown about the evolution of wealth toward the end of life. In this paper, we develop a new measure of household resources that converts total financial, nonfinancial, and annuitized assets into an expected annual amount of wealth per person. We use this measure, which we call annualized comprehensive wealth to investigate spend-down behavior among older households in the Health and Retirement Study. Our analysis indicates that, in (real) dollar terms, the median household's wealth declines more slowly than its remaining life expectancy, so that real annualized wealth actually tends to rise with age over retirement. Comparing the estimated age profiles for annualized wealth with profiles simulated from several different life cycle models, we find that a model that takes into account uncertain longevity, uncertain medical expenses, and (for higher-income retirees) intended bequests lines up best with the HRS data. %B Center for Retirement Research at Boston College Working Papers %I Boston College, Center for Retirement Research %C Boston %G eng %U https://crr.bc.edu/working-papers/the-trajectory-of-wealth-in-retirement/ %L newpubs20090908_CRR2008-7.pdf %4 Wealth Accumulation/Retirement Wealth/Consumption %$ 20550 %0 Book %D 2008 %T Transmitting Inequality: Wealth and the American Family %A Elmelech, Yuval %K Adult children %K Demographics %K Net Worth and Assets %X While the United States is the world's richest nation, the distribution of private property and wealth among Americans is often comprised of alarmingly disparate portions. With a rapidly aging and increasingly diverse population, the interdependence between generations, institutions, and social spheres has become essential to social stratification processes in contemporary American society. In this authoritative work, Yuval Elmelech investigates the role that family transactions of material resources play in the stratification system. Drawing on empirical evidence from a broad array of sources, Transmitting Inequality provides an interdisciplinary framework for examining the social, demographic, and institutional structures that shape the distribution of property and wealth in the United States. %I Rowman and Littlefield Publishers Inc. %C Lanham %G eng %4 Wealth/Intergenerational Transfers/Bequests/Social Stratification %$ 19120 %0 Report %D 2008 %T Wealth Change and Active Saving at Older Ages %A Michael D Hurd %A Susann Rohwedder %K Consumption and Savings %K Event History/Life Cycle %K Net Worth and Assets %X According to the simple lifecycle model single persons are predicted to decumulate assets at advanced age, when mortality risk is high to reduce the risk of dying with substantial wealth. Empirically it has been difficult to show this prediction in micro data. In this paper we discuss the most common limitations in existing data. We provide empirical evidence of dissaving at older ages by single persons using the unusually rich data from the Health and Retirement Study. We present lifecycle patterns of dissaving based on three very different kinds of data: those that are derived from wealth change, those derived from measures of active saving defined as disposable income minus consumption and those that are derived from model simulation. Based on wealth change we find evidence of dissaving for singles and limited evidence for couples: couples preserve wealth longer to provide for the surviving spouse. However, rates of active saving imply much smaller wealth decumulation for singles and no decumulation at all for couples. Decumulation based on model simulation lies between the two. We suspect that the discrepancies are partly due to the treatment of taxes and partly due to consumption being under measured. %I RAND and Netspar %G eng %4 life Cycle/Asset accumulation/Dissaving/wealth %$ 62660 %0 Report %D 2008 %T What Effect Do Time Constraints Have on the Age of Retirement? %A Friedberg, Leora %A Wei Sun %A Anthony Webb %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Work affects both the time available for non-market activities and the times at which those activities are performed and therefore work-induced constraints on time use may influence retirement decisions. We analyze these effects by combining new data from the American Time Use Survey with information on retirement in the Health and Retirement Study. We find that the propensity to engage in three types of non-work activities household production, leisure, and tertiary activities (eating, sleeping, grooming) are substantially altered by work. Moreover, the ways in which the timing of these activities are distorted differ across ten different job types (industry-occupation combinations) that we examine in the ATUS. We use the resulting measures of time distortions as control variables in multinomial logit retirement models that we estimate in the HRS. Older workers in jobs with greater distortions to the quantity and timing of leisure activities have an increased propensity to leave those jobs, either for new jobs or for retirement. On the other hand, workers in jobs with greater distortions to household production have a reduced propensity to leave their jobs, and distortions to tertiary activities raise the propensity to take new jobs but reduce the propensity to retire. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/what-effect-do-time-constraints-have-on-the-age-of-retirement/ %L newpubs20090908_CRR2008-17.pdf %4 Household Production/Leisure/Working Hours/Retirement planning %$ 20580 %0 Report %D 2008 %T Who Values the Social Security Annuity? New evidence on the annuity puzzle %A Brown, Jeffrey R. %A Casey, Marcus D. %A Olivia S. Mitchell %K Methodology %K Net Worth and Assets %K Pensions %K Social Security %X 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. %B NBER Working Paper %I National Bureau of Economic Research %C Cambridge, MA %G eng %4 Social Security/Social Security Research/lump sum distributions/Annuities %$ 19590 %R 10.3386/w13800 %0 Journal Article %J Journal of Monetary Economics %D 2007 %T Baby Boomer Retirement Security: The Roles of Planning, Financial Literacy, and Housing Wealth %A Annamaria Lusardi %A Olivia S. Mitchell %K Housing %K Net Worth and Assets %X 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. %B Journal of Monetary Economics %I 54 %V 54 %P 205-224 %G eng %N 1 %L wp_2006/MRRCwp114.pdf %4 Retirement Wealth/Housing Equity/Stock Market %$ 16380 %R https://doi.org/10.1016/j.jmoneco.2006.12.001 %0 Report %D 2007 %T Children and Household Wealth %A John Karl Scholz %A Ananth Seshadri %K Adult children %K Net Worth and Assets %X This paper examines the effects of children on consumption and wealth. To anchor intuition, we develop implications using a simple permanent income model with no uncertainty and complete markets. But this framework does not come close to matching the distribution of existing wealth. We therefore examine the effects of children using a rich, augmented life-cycle model, and using a life-cycle model with endogenous fertility. We find that children have a large effect on household s net worth and consequently are an important factor in understanding the wealth distribution. The effects of children are much larger than the effects of asset tests associated with cash and near-cash transfers, given earnings realizations and the social security system experienced by households in the original HRS cohort. We also show that fertility and credit constraints interact in ways that significantly affect wealth accumulation. %B Michigan Retirement Research Center Research Paper %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %L newpubs20080822_wp158 %4 CHILDREN/Households/Wealth Accumulation %$ 17790 %R http://dx.doi.org/10.2139/ssrn.1083829 %0 Book Section %B Redefining Retirement: How Will Boomers Fare? %D 2007 %T Cohort Differences in Retirement Expectations and Realizations %A Nicole Maestas %K Expectations %K Net Worth and Assets %K Other %X This chapter compares retirement expectations, retirement patterns, and expectations of future work across different cohorts of the Health and Retirement Study, including the new cohort of Baby Boomers currently in their late 50’s. We find that the Boomers are more strongly attached to the labor force as they enter their retirement years than were earlier cohorts at the same age. Compared to the preceding birth cohort, they expect to retire nearly one year later, they are 14 percent more likely to expect to be working full-time at age 65, and they are 21 percent more likely to expect to work in the future if they are not currently working. We find that these differences are not entirely explained by cohort differences in socioeconomic status, pension incentives, demographics, or health. We conclude that the Baby Boomers may have stronger preferences for work than previous cohorts. %B Redefining Retirement: How Will Boomers Fare? %I Oxford University Press %C New York, NY %G eng %U https://repository.upenn.edu/cgi/viewcontent.cgi?article=1362&context=prc_papers %4 Retirement Expectations/Retirement Wealth/COHORT %$ 18110 %! Cohort Differences in Retirement Expectations and Realizations %0 Report %D 2007 %T Do Households Have Enough Retirement Wealth? %A Love, David A. %A Paul A Smith %A McNair, Lucy C. %K Income %K Net Worth and Assets %X Dramatic structural changes in the U.S. pension system, along with the impending wave of retiring baby boomers, have given rise to a broad policy discussion of the adequacy of household retirement wealth. We construct a uniquely comprehensive measure of wealth for households aged 51 and older in 2004 that includes expected wealth from Social Security, defined benefit pensions, life insurance, annuities, welfare payments, and future labor earnings. Abstracting from the uncertainty surrounding asset returns, length of life and medical expenses, we assess the adequacy of wealth using two expected values: an annuitized value of comprehensive wealth and the ratio of comprehensive wealth to the actuarial present value of future poverty lines. We find that most households in these older cohorts can expect to have sufficient total resources to finance adequate consumption throughout retirement, taking as given expected lifetimes and current Social Security benefits. We find a median annuity value of wealth equal to 32,000 per person per year in expected value and a median ratio of comprehensive wealth to poverty-line wealth of 3.56. About 12 percent of households, however, do not have sufficient wealth to finance consumption equal to the poverty line over their expected lifetimes, even after including the value of Social Security and welfare benefits, and an additional 9 percent can expect to be relatively close to the poverty line. %I Social Science Research Network %G eng %U http://ssrn.com/abstract=968412 %L newpubs20070501_SSRN-id968412.pdf %4 Retirement Wealth/retirement adequacy/Poverty %$ 17430 %0 Journal Article %J Applied Economics %D 2007 %T Do the Sick Retire Early? Chronic illness, asset accumulation and early retirement %A Miah, M. Solaiman %A Wilcox-Gök, Virginia %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Our objective is to determine how chronic illness affects asset accumulation and retirement. Previous studies have found that poor health leads to early retirement, but those studies failed to look at the indirect impact of chronic illness on retirement. Using data from the Health and Retirement Study, we define an illness as chronic if the individual reports having asthma, cancer, heart disease, stroke or diabetes for four or more years. We first estimate how a chronic illness influences asset accumulation. We then estimate how asset accumulation and current poor health influence retirement. We observe that the vast majority of the chronically ill population do not report their general health to be poor nor do they report functional limitations in activities of daily living. Nevertheless, our results indicate that chronic illness leads these people to accumulate fewer assets during their working years and consequently retire later. Neither researchers nor policymakers discussing the many critical issues surrounding illness and retirement have addressed this issue. %B Applied Economics %I 39 %V 39 %P 1921 %G eng %U https://commons.lib.niu.edu/handle/10843/13288 %N 15 %L newpubs20071002_AppliedEcon.pdf %4 Chronic Illness/Assets/Early Retirement %$ 18020 %0 Thesis %D 2007 %T The Effect of Health and Health Risk Factors on Non-Housing Wealth and Medical Expenses %A Rodriguez-Flores, Alicia %K Health Conditions and Status %K Net Worth and Assets %X The purpose of this study was to investigate the effects of health conditions and health risk factors on non-housing wealth changes of older adults. The research was based on Grossman's economic model of health which proposes that health stock is determined by the individual's current and past inputs and behavior. The 4 th and 6 th waves of the Health and Retirement Study were used to examine the relationship between health problems and health risk factors and the percentage change of non-housing wealth, out-of-pocket medical expenses, and total medical expenses. For couples, changes in non-housing wealth were negatively related to a head of household who abused alcohol, and to a spouse who smoked; wealth changes were positively related to a spouse who was physically active. For single individuals, mild health conditions were negatively related to wealth changes; problem drinking was positively related to changes in non-housing wealth. Out-of-pocket and total medical expenses were also influenced by health conditions and health risk factors. In summary, this research revealed that health risk factors can affect total wealth as well as increase medical expenses. Those who advise consumers in regard to wealth accumulation should include the effect of health and health risk factors. Similarly, those who advise consumers with regard to health and health risk factors should include guidance about the effect of healthy behaviors on wealth. %I Purdue University %8 2007 %G eng %U https://docs.lib.purdue.edu/dissertations/AAI3307419/ %4 Wealth %$ 19350 %! The Effect of Health and Health Risk Factors on Non-Housing Wealth and Medical Expenses %0 Report %D 2007 %T The Effect of Subjective Survival Probabilities on Retirement and Wealth in the United States %A David E Bloom %A Canning, David %A Moore, Michael %A Song, Younghwan %K Expectations %K Net Worth and Assets %X We explore the proposition that expected longevity affects retirement decisions and accumulated wealth using micro data drawn from the Health and Retirement Study for the United States. We use data on a person s subjective probability of survival to age 75 as a proxy for their prospective lifespan. In order to control for the presence of measurement error and focal points in responses, as well as reverse causality, we instrument subjective survival probabilities using information on current age, or age at death, of the respondent s parents. Our estimates indicate that increased subjective probabilities of survival result in increased household wealth among couples, with no effect on the length of the working life. These findings are consistent with the view that retirement decisions are driven by institutional constraints and incentives and that a longer expected lifespan leads to increased wealth accumulation. %I University of St. Gallen, World Demographic Association %G eng %L newpubs20070403_WDA-HSG2007-1.pdf %4 Subjective Probabilities of Survival/Wealth Accumulation %$ 17330 %0 Report %D 2007 %T Enhancing the Quality of Data on the Measurement of Income and Wealth %A Juster, F. Thomas %A Cao, Honggao %A Mick P. Couper %A Daniel H. Hill %A Michael D Hurd %A Joseph P. Lupton %A Michael M. Perry %A James P Smith %K Income %K Methodology %K Net Worth and Assets %X Over the last decade or so, a substantial effort has gone into the design of a series of methodological investigations aimed at enhancing the quality of survey data on income and wealth. These investigations have largely been conducted at the Survey Research Center at the University of Michigan, and have mainly involved two longitudinal surveys: the Health and Retirement Study (HRS), with a first wave beginning in 1992 and continued thereafter every other year through 2004; and the Assets and Health Dynamics Among the Oldest Old (AHEAD) Study, begun in 1993 and continued in 1995 and 1998, then in every other year through 2004. Surveys for the year 2006 are currently in the field. This paper provides an overview of the main studies and summarizes what has been learned so far. The studies include; a paper by Juster and Smith (Improving the Quality of Economic Data: Lessons from the HRS and AHEAD, JASA, 1997); a paper by Juster, Cao, Perry and Couper (The Effect of Unfolding Brackets on the Quality of Wealth Data in HRS, MRRC Working Paper, WP 2006-113, January 2006); a paper by Hurd, Juster and Smith (Enhancing the Quality of Data on Income: Recent Innovations from the HRS, Journal of Human Resources, Summer 2003); a paper by Juster, Lupton and Cao (Ensuring Time-Series Consistency in Estimates of Income and Wealth, MRRC Working Paper, WP 2002-030, July 2002); a paper by Cao and Juster (Correcting Second-Home Equity in HRS/AHEAD: MRRC Working Paper WP 2004-081, June 2004); and a paper by Rohwedder, Haider and Hurd (RAND Working Paper, 2004). %B Michigan Retirement and Disability Research Center Research Paper %I Michigan Retirement and Disability Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1095815 %L newpubs20070125_Juster_etal_wp151 %4 Methodology/Data Quality/income/Wealth %$ 17010 %0 Thesis %B Economics %D 2007 %T Essays in Labor Economics: Alcohol consumption and socioeconomic outcomes %A Sarpong, Eric %K Demographics %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X Recent studies indicate that alcohol consumption may affect socioeconomic outcomes through its effects on health capital and social capital. If, in fact, differences in socioeconomic outcomes are causally linked to differences in alcohol consumption, then lack of adequate insight into such connectivity may adversely affect the labor market and retirement outcomes of some groups of individuals in society. The rationale for examining the relationship between alcohol consumption and socioeconomic outcomes stems from growing concerns about deterioration in retirement outcomes resulting from declining health capital and recent shifts to incorporate social capital as a key performance or productivity indicator by employers. In two essays, this research examines the impact of alcohol consumption on wealth at retirement using data from the RAND Health and Retirement Study (HRS) from 1992 through 2002; and the effects of alcohol consumption on employment duration and earnings using the Geocode version of the National Longitudinal Survey of Youth (NLSY1979) micro dataset from 1984 through 1996. The theoretical foundation of the association between alcohol use and economic outcomes relies on Grossman's (1972) health capital model. Empirically, the research relies on panel data methods and duration analysis to determine whether differences in socioeconomic outcomes can be explained by differences in alcohol consumption. Using both duration analysis and panel data methods, the results indicate that drinking is positively related to improved socioeconomic outcomes as compared to total abstention, when endogeneity has not been taken into account. In contrast, under the duration analysis, estimation via instrumental variables approach indicates that alcohol consumption shortens employment duration. Panel data estimation indicates that the relationship between alcohol consumption and socioeconomic outcomes is rather an inverted U-shaped for some specifications, when endogeneity has been taken into account. Additionally, the effects of drinking on retirement wealth and earnings tend to diminish with the instrumental variables approach. The findings were unchanged even with abstainers partitioned into lifetime abstainers and infrequent or light drinkers (less than one drinking day per week). The results also confirm the positive association between human capital measures such as the level of education and economic outcomes and also the negative relationship between alcohol consumption and taxes on alcoholic beverages. This dissertation contributes to the literature on alcohol-socioeconomic outcomes nexus and has implications for policies related to health, social capital and alcohol since a more inclusive alcohol and/or health policy could improve civic responsibility and narrow the health capital and social capital gap, both of which are critical to individual level socioeconomic success. %B Economics %I Georgia State University %C Atlanta, GA %V Doctor of Philosophy %G eng %U https://scholarworks.gsu.edu/econ_diss/25/ %4 Labor Force Participation %$ 17820 %0 Thesis %D 2007 %T Essays on Optimal Portfolio Choice and Unemployment Insurance %A Luo, Jia %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X This dissertation consists of two essays exploring optimal portfolio choice over the life cycle and optimal unemployment insurance program. The first essay explores the effects of uninsurable risk of health expenditures as well as labor income risk on portfolio choice in a realistically calibrated life-cycle model. Most of the existing literature that examines labor income risk and its effect on portfolio composition cannot explain continued declines in risk-taking with age after retirement. This paper uses MEPS (Medical Expenditure Panel Survey) and HRS (Health and Retirement Study) data to calibrate uncertain medical expenses for the retired. With the consideration of idiosyncratic health expense risk in addition to labor income risk, the model can generate declining financial risk-taking with age after retirement, and therefore fits the data much better than those studies which consider labor income alone. Additionally, regressions on simulated data also show that investors with poorer health tend to hold a smaller share of stocks in their portfolios, which is consistent with the empirical pattern of portfolio choice. Finally, using the model I have developed, I predict the impact of changes in government health insurance programs, such as the expansion of the Medicare program, on individuals' portfolio choices. Simulated results show that a more generous Medicare policy significantly increases the proportion of financial wealth held in equities for the retired. The second essay proposes the optimal design of the unemployment insurance contract in an environment with consumption commitments in which people cannot substitute freely among different goods within a single period. The optimal plan I obtain involves a relatively flat decreasing sequence of insurance payments over some duration, which is then followed by a large drop to a very low level of transfer. The results fit current policy well, and therefore give an explanation to justify the current policy. Additionally, the model predicts that if we change from the current unemployment program to the optimal contract, the government will only save 1.7% in unemployment payments, which shows that current policy is not as flawed as researchers have traditionally believed. In fact, to achieve efficiency, the efficient unemployment transfers should include a jump, similar to what we observe in practice. %I University of California, Los Angeles %8 2007 %G eng %4 Health Expenditures %$ 18760 %! Essays on Optimal Portfolio Choice and Unemployment Insurance %0 Report %D 2007 %T Growing Older in America: The Health and Retirement Study %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Growing Older in America: The Health and Retirement Study describes the breadth and depth of the HRS to help familiarize a broad range of researchers; policymakers; media; and organizations concerned with health, economics, and aging with this data resource. Published in 2007, this colorful data book describes the HRS's development and features and offers a snapshot of research findings based on analyses of the Study's data. Sections of the report look at older adults health, work and retirement, income and wealth, and family characteristics and intergenerational transfers. More than 65 figures and tables illustrate the text. %I US Department of Health and Human Services %C Washington, DC %G eng %U https://www.nia.nih.gov/sites/default/files/2017-06/health_and_retirement_study_0.pdf %4 aging/Health/RETIREMENT/financial resources %$ 19360 %0 Journal Article %J Employee Benefit Research Institute Issue Brief 302 %D 2007 %T How Are New Retirees Doing Financially in Retirement? %A Copeland, Craig %K Consumption and Savings %K Net Worth and Assets %X Although there has been extensive analysis of the accumulation of retirement assets in the United States, limited research has been done on how quickly Americans use their assets in retirement. Utilizing data from the Health and Retirement Study (HRS), this Issue Brief examines those currently between ages 65 and 75 to determine their levels of wealth in retirement, how those levels have changed, and to see if this group is on track for a financially secure retirement. %B Employee Benefit Research Institute Issue Brief 302 %I Issue Brief 302 %V Issue Brief 302 %G eng %U https://www.ebri.org/content/how-are-new-retirees-doing-financially-in-retirement--3781 %4 Assets/Consumption/Wealth %$ 17310 %0 Report %D 2007 %T How do Immigrants Fare in Retirement? %A Purvi Sevak %A Lucie Schmidt %K Demographics %K Net Worth and Assets %K Pensions %K Social Security %X Existing literature suggests that immigrants receive lower wages than U.S.-born workers with similar characteristics. This could imply that immigrant households would enter retirement at a significant financial disadvantage. In this paper, we examine the retirement resources available to immigrant families by examining Social Security benefits, pension coverage, and private wealth accumulation. Our results suggest that although immigrant families may be financially better-off in the U.S. than in their native countries, they do enter retirement at a significant financial disadvantage relative to native born households with similar characteristics. %B University of Michigan Retirement Research Center Working Paper %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://deepblue.lib.umich.edu/handle/2027.42/57433 %L newpubs20080229_wp169.pdf %4 Immigrants/Retirement Wealth/Social Security/Pensions %$ 18380 %0 Book Section %B Redefining Retirement: How Will Boomers Fare? %D 2007 %T The Impact of Pensions on Nonpension Investment Choices %A Friedberg, Leora %A Anthony Webb %K Consumption and Savings %K Net Worth and Assets %K Pensions %X This chapter documents the investment choices of workers outside their company pensions. The Health and Retirement Study is used to evaluate how investment patterns outside pension holdings have been influenced by the shift from defined benefit to defined contribution pensions. Since workers with defined benefit plans can expect steady income in retirement, they might be thought to invest less conservatively outside their pensions. Nevertheless, the data show otherwise. Defined contribution participants also hold stock investments outside their pension portfolios. These findings suggest that increased stock holding as defined benefit plans decline in importance. %B Redefining Retirement: How Will Boomers Fare? %I Oxford University Press %C New York, NY %P 179-210 %@ 9780199230778 %G eng %4 Investments/Pensions/Retirement Saving %$ 18160 %R DOI:10.1093/acprof:oso/9780199230778.003.0009 %0 Thesis %D 2007 %T Life-Cycle Consumption Examined %A Pounder, Laurie %K Consumption and Savings %K Net Worth and Assets %X This set of papers uses new data to construct an empirical measure of the average propensity to consume out of "full" wealth among older households. Consistent with original neoclassical life-cycle theory, full wealth is defined as the present value of all current and future lifetime resources. This definition implies a simple theoretical expression for the average propensity to consume, with consumption proportional to full wealth. Data now available in the Health and Retirement Study (HRS) allow construction of a credible household-level estimate of full consumption and full wealth. A primary advantage of the average propensity to consume out of full wealth is its theoretical simplicity. First, full wealth is more equally distributed than net worth. Second, the propensity to consume out of full wealth, when compared to the propensity to consume out of income or net worth, has less dispersion cross-sectionally, more consistency over time, and more invariance to "circumstances" or factors such as pension entitlement, income profile, and past income shocks. Finally, the consumption propensity out of full wealth responds less to unexpected changes in resources, specifically unexpected retirement, than the other consumption measures. Comparing the consumption propensity out of full wealth observed in the HRS to the prediction of a neoclassical model of consumption with uncertainty in mortality and asset returns suggests that heterogeneity in preferences, specifically time preference or the willingness to substitute inter-temporally, is necessary to explain the extent of observed cross-household heterogeneity within the model. Estimates of the model with returns to scale in household size, a fixed cost of working, and household-specific variation in expected asset returns only account for a small portion of the variation in the observed consumption rate. After controlling for subjective mortality, expected bequests, and demographics using survey data, the residual is correlated with the level of wealth and with variables that may indicate an inherent characteristic of patience. Exploring alternative explanations for the heterogeneity, cognitive and planning abilities can help explain the residual heterogeneity in the propensity to consume. In particular, measures of basic cognition, horizon of financial planning, basic financial literacy, and goal-oriented behavior is associated negatively with the unexplained variation in consumption rates. In other words, higher skilled households consume less after controlling for factors in the neoclassical model. %I University of Michigan %8 2007 %G eng %4 Wealth %$ 18520 %! Life-Cycle Consumption Examined %0 Book Section %B Retirement Provision in Scary Markets %D 2007 %T Lifetime Earnings Variability and Retirement Shortfalls %A Olivia S. Mitchell %A John W R Phillips %A Au, Andrew %E Hazel Bateman %K Net Worth and Assets %B Retirement Provision in Scary Markets %I Edward Elgar %C Cheltenham:UK %P 78-99 %G eng %4 Retirement Wealth %$ 13112 %! Lifetime Earnings Variability and Retirement Shortfalls %0 Report %D 2007 %T Measuring Dissaving Out of Retirement Wealth %A Love, David A. %A Paul A Smith %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %X The approaching retirement of the baby boomers, accelerating trend from DB to DC pension plans, and growing uncertainty over the solvency of Social Security all raise important questions about the ability of households to finance their retirement years with liquid assets, rather than annuities. We use data from four waves of the HRS to investigate how households spend down their retirement wealth, and, in particular, whether they appear to run down their retirement accounts too quickly. We find no evidence of excessive dissaving over the period 1998 to 2004. Indeed, the annuitized value of total wealth rose for most households over this period, suggesting that households are not running down their assets too fast, given their remaining life expectancies. %I Social Science Research Network %G eng %L newpubs20070501_SSRN-id968431.pdf %4 Retirement Wealth/spending patterns/Assets/Dissaving %$ 17440 %R http://dx.doi.org/10.2139/ssrn.968431 %0 Book Section %B Redefining Retirement: How Will Boomers Fare? %D 2007 %T Measuring Pension Wealth %A Christopher R. Cunningham %A Gary V. Engelhardt %A Kumar, Anil %K Income %K Net Worth and Assets %K Pensions %X Pension wealth plays a critical role in older individuals' retirement behavior and financial security. Accordingly, the magnitude and distribution of pension wealth is important in the ongoing debate about whether Baby Boomers have adequate retirement savings. This chapter summarizes the results of a long-term effort to develop an improved calculator to measure defined contribution pension wealth of older Americans, implemented using the Health and Retirement Study. Results show that pension wealth resulting from voluntary saving (and accrued earnings thereon) comprises half of DC pension wealth calculated for HRS respondents with matched summary plan descriptions. These are lower mean estimates of DC pension wealth than previously found, mainly resulting from changes for the wealthiest tail of the pension-wealth distribution. The findings imply that researchers must think more carefully about the economic assumptions underlying pension measures. %B Redefining Retirement: How Will Boomers Fare? %I Oxford University Press %C New York, NY %G eng %4 Pension Wealth/retirement adequacy/Pension Plans %$ 18170 %R DOI:10.1093/acprof:oso/9780199230778.003.0010 %0 Report %D 2007 %T Medicaid Long-Term Care: Few Transferred Assets before Applying for Nursing Home Coverage; Impact of Deficit Reduction Act on Eligibility is Uncertain %A United States Governmental Office %K Healthcare %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Public Policy %X Question: There is some concern that individuals transfer assets (at less than fair market value) in order to be eligible for Medicaid. Since Medicaid paid nearly one-half of the nation s total long-term care expenditures in 2004, analysis was needed to determine how prevalent this practice was. Finding: Using the NIA-funded Health and Retirement Study, GAO found that few elderly individuals had resources to support even a year s worth of private-pay nursing home care at the time they entered a nursing home. Medicaid-covered nursing home residents were less likely to have reported transferring cash than non-Medicaid-covered residents. %B GAO Report %I U.S. Government Accountability Office %C Ann Arbor, MI %G eng %U https://www.gao.gov/products/GAO-07-280 %4 Asset transfer/Medicaid/Long Term Care/Public Policy %$ 62558 %0 Journal Article %J Public Finance Review %D 2007 %T Medicaid's Nursing Home Coverage and Asset Transfers %A Bassett, William F. %K Healthcare %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %X Medicaid covers the costs of a long nursing home stay. This coverage may create an incentive for the elderly to transfer their assets to their children to qualify for Medicaid before entering a nursing home. Previous researchers had found little evidence that such behavior was widespread or that asset transfers were large. However, data from the Study of Asset and Health Dynamics Among the Oldest Old (AHEAD) suggest that the self-assessed probability of entering a nursing home is a significant determinant of the likelihood of making an asset transfer. The budgetary implications of these Medicaid-induced asset transfers were probably fairly small at the time of the study, but not insignificant, and are likely to have risen steadily since. %B Public Finance Review %I 35 %V 35 %P 414-439 %G eng %U http://www.federalreserve.gov/pubs/feds/2004/200415/200415pap.pdf %N 3 %L newpubs20070611_BassettPFR.pdf %4 Medicaid/Nursing Homes/Assets %$ 15060 %0 Report %D 2007 %T Projecting Behavioral Responses to the Next Generation of Retirement Policies %A Alan L Gustman %A Thomas L. Steinmeier %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper examines retirement and related behavioral responses to policies that on average are actuarially neutral. Many conventional models predict that actuarially neutral policies will not affect retirement behavior. In contrast, our model allows those with high time preference rates to find that the promise of an actuarially fair increase in future rewards does not balance the loss from foregone current benefits. Using data from the Health and Retirement Study, we find that from age 62 through full retirement age, the earnings test reduces full-time work by married men by about four percentage points, or by about ten percent of married men at full-time work. Abolishing the requirements on many jobs that an individual work full-time or not at all, what we term a minimum hours constraint on employment, would induce more than twice as many people to enter partial retirement as would leave full-time work, so that total full-time equivalent (FTE) employment would increase, although by a modest amount. If all benefits from personal accounts could be taken as a lump sum, the fraction not retired at age 62 would fall by about 5 percentage points compared to a system where there is mandatory annuitization of benefits. %B Michigan Retirement and Disability Research Center Publication %I Michigan Retirement and Disability Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/pubs/projecting-behavioral-responses-to-the-next-generation-of-retirement-policies/ %L newpubs20080229_wp153.pdf %4 Retirement Behavior/Retirement Policies/Annuities/Part-Time Work %$ 18430 %0 Book %D 2007 %T Redefining Retirement: How Will Boomers Fare? %A Brigitte C. Madrian %A Olivia S. Mitchell %A Beth J Soldo %K Consumption and Savings %K Health Conditions and Status %K Income %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Pensions %I Oxford University Press %C New York, NY %G eng %U https://pensionresearchcouncil.wharton.upenn.edu/publications/books/redefining-retirement-how-will-boomers-fare/ %4 Cohort Studies/retirement adequacy/Pensions/Retirement Saving/Retirement Wealth/health status %$ 18100 %0 Journal Article %J Journal of Income Distribution %D 2007 %T Replacing Income in Retirement for the Newly Retired: A Distributional Analysis of Gross and Net Replacement Rates %A Bender, Keith A. %K Income %K Net Worth and Assets %K Public Policy %X Income replacement after retirement is an increasingly important economic policy area of social concern. This study examines three different measures of replacement income, including the effect of taxes on the estimated replacement rates of new retirees in the Health and Retirement Study. An analysis of replacement rates on average and in different parts of the distribution shows that married, older, and voluntary retirees have the highest replacement rates and that income from pensions and Social Security still form the majority of retirement income replacement. %B Journal of Income Distribution %I 16 %V 16 %P 83-105 %G eng %U https://econpapers.repec.org/article/jidjournl/y_3a2007_3av_3a16_3ai_3a2_3ap_3a83-105.htm %N 2 %L newpubs20071203_replacementratesjid.pdf %4 Retirement Incomes/Distribution/Taxes %$ 18340 %0 Thesis %B Economics %D 2007 %T Risk Tolerance and Asset Accumulation %A Claudia R Sahm %K Net Worth and Assets %K Risk Taking %X Economic theory assigns a central role to risk preference in asset allocation. This dissertation includes three papers that investigate this relationship empirically. The first paper uses panel data on hypothetical gambles over lifetime income in the Health and Retirement Study to quantify changes in risk tolerance over time and differences across individuals. The maximum-likelihood estimation of a model with correlated random effects draws on detailed information from 12,000 respondents in the 1992-2002 HRS. The results support constant relative risk aversion and earlier career selection based on preferences. While risk tolerance changes with age and macroeconomic conditions, persistent differences across individuals account for 73% of the systematic variation in preferences. The measure of risk tolerance also relates to actual stock ownership. The second paper develops a measure of relative risk tolerance using responses to hypothetical income gambles in the HRS. In contrast to most survey measures that produce an ordinal metric, this paper shows how to construct a cardinal proxy for the risk tolerance of each survey respondent. The paper also shows how to account for measurement error in estimating this proxy and how to obtain consistent regression estimates despite the measurement error. The risk tolerance proxy is shown to explain differences in asset allocation across households. The third paper investigates whether the characteristics of household labor income can account for the observed heterogeneity in financial portfolios. Households differ substantially in the riskiness of their labor income and in the magnitude of their labor income relative to their financial assets; however, the results of this paper suggest that households do not integrate their human capital in their financial asset allocation. This analysis uses a direct, household-level comparison between actual stock allocations and predicted allocations in three economic models with different assumptions about labor income. When labor income is excluded from the model, the correlation between actual and predicted stock allocations is 0.16. The inclusion of certain or risky labor income in the model leads to negative correlations of -0.12 and -0.06 respectively. There is no evidence that households take a broad view of wealth and diversify risks across their financial assets and human capital. %B Economics %I University of Michigan %C Ann Arbor, MI %V Doctor of Philosophy %8 2007 %G eng %U https://deepblue.lib.umich.edu/bitstream/handle/2027.42/55677/csahm_1.pdf %4 Stock Market %$ 18560 %! Risk Tolerance and Asset Accumulation %0 Report %D 2007 %T Subjective Survival Probabilities in the Health and Retirement Study: Systematic Biases and Predictive Validity %A Todd E. Elder %K Expectations %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Recent research has demonstrated that retirement planning and well-being are closely tied to probabilistic forecasts about future events. Using longitudinal data from the Health and Retirement Study, I show that individuals subjective survival forecasts exhibit systematic biases relative to life table data. In particular, many respondents fail to account for increases in yearly mortality rates with age, both longitudinally and in crosssection. Additionally, successive cohorts of the near elderly do not appear to revise survival forecasts to match increases in longevity. Forecasting bias may merely be due to the framing of questions designed to elicit expectations, but real biases may result in suboptimal savings rates and timing of retirement. Cross-sectional variation in subjective survival forecasts also appears to reflect differences in cognitive ability across respondents, suggesting that subjective information is more relevant for some individuals than others. Despite these shortcomings, subjective mortality probabilities predict actual mortality and portfolio choice, and they contain information not found in selfreported health status or objective measures of health limitations. %B Michigan Retirement Research Center Research Paper %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %L newpubs20080822_wp159 %4 Retirement planning/Subjective Probabilities of Survival/Mortality/Portfolio Choice %$ 19280 %R http://dx.doi.org/10.2139/ssrn.1083823 %0 Book Section %B Redefining Retirement: How Will Boomers Fare? %D 2007 %T Trends in Pension Values Around Retirement %A Michael D Hurd %A Susann Rohwedder %K Net Worth and Assets %B Redefining Retirement: How Will Boomers Fare? %I Oxford University Press %C New York, NY %G eng %4 Pension Wealth/Retirement Wealth %$ 18180 %! Trends in Pension Values Around Retirement %R 10.1093/acprof:oso/9780199230778.003.0011 %0 Book %D 2007 %T Women, Marriage and Wealth: The impact of marital status on the economic well-being of women through the life course %A Joyce, Joyce Ann %K Adult children %K Net Worth and Assets %K Women and Minorities %I Gordon Knot Books %C New York, NY %G eng %4 Women/Economic Status/Marital Status/Wealth %$ 19600 %0 Thesis %D 2006 %T Ageing and Well-Being: Consumption and Time Use of Elderly Americans %A Gortz, Mette %K Consumption and Savings %K Demographics %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper studies patterns of consumption, household production and leisure for the elderly American population. The main objective of the paper is to study how incorporating the value of time spent in household production and leisure affects economic well-being. Based on the 2003 Consumption and Mail Activities Survey (CAMS) from the Health and Retirement Study (HRS), we find that the level of expenditure is lower for non-retired people, while levels of housework and leisure are higher. We also see that expenditure are decreasing with age, while leisure is increasing with age for both groups. Inequality in expenditure is higher for the group of retired households as compared to the group of non-retired households. However, while the elderly and retired seem to be less well off in terms of consumption goods bought in the market, they are generally "richer" in terms of time for household production or leisure. Broadening our concept of economic well-being to include first the value of household production and secondly the value of leisure reduces our measure of economic inequality among the elderly. %I University of Copenhagen %8 2006 %G eng %L wp_2006/GortzChap3.pdf %4 Elderly %$ 16600 %! Ageing and Well-Being: Consumption and Time Use of Elderly Americans %0 Report %D 2006 %T Baby Boom Generation: Retirement of Baby Boomers is Unlikely to Precipitate Dramatic Decline in Market Returns, but Broader Risks Threaten Retirement Security %A United States Governmental Office %K Demographics %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X The first wave of baby boomers(born between 1946 and 1964) will become eligible for Social Security early retirement benefits in 2008. In addition to concerns about how the boomers' retirement will strain the nation's retirement and health systems, concerns also have been raised about the possibility for boomers to sell off large amounts of financial assets in retirement, with relatively fewer younger U.S. workers available to purchase these assets. Some have suggested that such a sell-off could precipitate a market "meltdown," a sharp and sudden decline in asset prices, or reduce long-term rates of return. In view of such concerns, we have examined (1) whether the retirement of the baby boomers is likely to precipitate a dramatic drop in financial asset prices; (2) what researchers and financial industry participants expect the effect of the boomer retirement to have on financial markets; and (3) what role rates of return will play in providing retirement income in the future. We have prepared this report under the Comptroller General's authority to conduct evaluations on his own initiative as part of the continued effort to assist Congress in addressing these issues. Our analysis of national survey and other data suggests that retiring boomers are not likely to sell financial assets in such a way as to cause a sharp and sudden decline in financial asset prices. A large majority of boomers have few financial assets to sell. The small minority who own most assets held by this generation will likely need to sell few assets in retirement. Also, most current retirees spend down their assets slowly, with many continuing to accumulate assets. If boomers behave the same way, a rapid and large sell off of financial assets appears unlikely. Other factors that may reduce the odds of a sharp and sudden drop in asset prices include the increase in life expectancy that will spread asset sales over a longer period and the expectation of many boomers to work past traditional retirement ages. A wide range of academic studies have predicted that the boomers' retirement will have a small negative effect, if any, on rates of return on assets. Similarly, financial industry representatives did not expect the boomers' retirement to have a big impact on the financial markets, in part because of the globalization of the markets. Our statistical analysis shows that macroeconomic and financial factors, such as dividends and industrial production, explained much more of the variation in stock returns from 1948 to 2004 than did shifts in the U.S. population's age structure, suggesting that demographics may have a small effect on stock returns relative to the broader economy. While the boomers' retirement is not likely to cause a sharp and sudden decline in asset prices, the retirement security of boomers and others will likely depend more on individual savings and returns on such savings. This is due, in part, to the decline in traditional pensions that provide guaranteed retirement income and the rise in account-based defined contribution plans. Also, fiscal uncertainties surrounding Social Security and rising health care costs will ultimately place more personal responsibility for retirement saving on individuals. Given the need for individuals to save and manage their savings, financial literacy will play an important role in helping boomers and future generations achieve a secure retirement. %I U.S. Government Accountability Office %C Washington, D.C. %G eng %U https://www.gao.gov/products/GAO-06-718 %4 Baby Boomers/assets/retirement planning/Public Policy/Financial literacy %$ 62556 %0 Report %D 2006 %T Earnings and Women's Retirement Security %A Alicia H. Munnell %A Natalia A. Zhivan %K Employment and Labor Force %K Net Worth and Assets %K Women and Minorities %X As the U.S. population ages, traditional sources of retirement income will likely fall short of what is needed to maintain pre-retirement living standards for many individuals. The issue of retirement security is especially important for women, because even today nearly 30 percent of single women, who represent a majority of households at older ages, are classified as poor or near-poor. One solution to the retirement security challenge is for women to work more during their lifetimes and to stay in the workforce longer as they age. By and large, those who continue to work until their mid-60s or beyond do not end up poor. The question is explored in this study is what determines women's labor force activity at older ages and what determines when they retire. Only by understanding these levers is it possible to make changes that are likely to encourage stronger labor force participation, and thus greater retirement security, for women. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/earnings-and-womens-retirement-security/ %L wp_2006/CRRwp2006-12.pdf %4 WOMEN/Labor Force Participation/Retirement Wealth %$ 16650 %0 Journal Article %J Research on Aging %D 2006 %T The Effect of Military Service on Wealth Accumulation %A Fitzgerald, Kelly G. %K Event History/Life Cycle %K Net Worth and Assets %X This study examines the association between serving active military duty and wealth accumulation. It was expected that those who served active duty would be more likely to accumulate less wealth than nonveterans. Using data from the first wave of the Health and Retirement Study, a sample of 5,800 men was analyzed to determine the relationship between the length of time spent on active military duty and net worth. Multiple regressions suggest that factors commonly associated with wealth accumulation significantly affect net worth. More important, the total number of years served was very significant in that additional years of service decreased net worth. The results were insignificant for respondents who served more than 20 years but suggest that extended military service may positively affect net worth. Overall, the results show that there is an economic disincentive to serve in the military, which may affect the ability of veterans to accumulate wealth and future military recruitment. %B Research on Aging %I 28 %V 28 %P 56 %G eng %N 1 %L wp_2006/Fitzgerald_RA.pdf %4 Life Events/Net Worth/Wealth Accumulation %$ 16000 %R https://doi.org/10.1177/0164027505281574 %0 Report %D 2006 %T The Effect of Subjective Survival Probabilities on Retirement and Wealth in the United States %A David E Bloom %A Canning, David %A Moore, Michael %A Song, Younghwan %K Expectations %K Net Worth and Assets %K Retirement Planning and Satisfaction %X We explore the proposition that expected longevity affects retirement decisions and accumulated wealth using micro data drawn from the Health and Retirement Study for the United States. We use data on a person's subjective probability of survival to age 75 as a proxy for their prospective lifespan. In order to control for the presence of measurement error and focal points in responses, as well as reverse causality, we instrument subjective survival probabilities using information on current age, or age at death, of the respondent's parents. Our estimates indicate that increased subjective probabilities of survival result in increased household wealth among couples, with no effect on the length of the working life. These findings are consistent with the view that retirement decisions are driven by institutional constraints and incentives and that a longer expected lifespan leads to increased wealth accumulation. %B NBER Working Paper %I National Bureau of Economic Research %C Washington, D.C. %G eng %L newpubs20070125_NBERwp12688 %4 Subjective Probabilities of Survival/Wealth Accumulation/Retirement Planning %$ 17110 %R 10.3386/w12688 %0 Report %D 2006 %T The Effect of Unfolding Brackets on the Quality of Wealth Data in HRS %A Juster, F. Thomas %A Cao, Honggao %A Michael M. Perry %A Mick P. Couper %K Methodology %K Net Worth and Assets %X A characteristic feature of survey data on household wealth is the high incidence of missing data roughly one in three respondents who report owning an asset are unable or unwilling to provide an estimate of the exact amount of their holding. A partial solution to that problem is to devise a series of questions that put the respondent s holdings into a quantitative range (less than x, more than x, or what?). These quantitative ranges are called unfolding brackets, and they represent a survey innovation that aims to improve the quality of wealth data by substituting range data for completely missing data. In this paper, we examine the effect of unfolding brackets on the quality of HRS wealth data. Special attention is given to the impact of unfolding bracket entry points on the distribution of asset holdings in HRS 1998. Although there is a small positive relationship between mean asset holdings and entry point, there are many cases where that relationship does not hold. In general, our conclusion is that entry point bias problems are not a major concern in the evaluation of quality in the 1998 HRS wealth data. %I The University of Michigan, Michigan Retirement Research Center %G eng %L wp_2006/MRRCwp113.pdf %4 Assets/unfolding bracket design/Wealth %$ 16430 %R 10.2139/ssrn.1094805 %0 Thesis %D 2006 %T The Effects of Private Pension Types on Older American Workers Portfolio Decisions and the Role of Health Measures in Understanding Expected Longevity %A Ni, Huan %Y Hugo Benítez-Silva %K Health Conditions and Status %K Net Worth and Assets %K Pensions %X Private pensions are regarded as the most important source of retirement income other than Social Security. Previous studies have found significant effects of pensions on individual decisions regarding wealth accumulation, labor supply, and retirement income security. However, few studies have investigated the effects of pension on individuals portfolio choices. Using the Health and Retirement Study (HRS), a panel data set of Older Americans. my study is one of the first to investigate pension effects on older American workers portfolio choices by differentiating Defined-Benefit (DB) pensions from Defined-Contribution (DC) pensions. I first investigate how pension types affect individual stock market participation by performing a two-step procedure. Without differentiating between pension types, pension has been found to have a positive effect on stock investments. My results of both cross-sectional and panel analysis, after correcting for sample selection, and controlling for unobserved heterogeneity, show that compared to holding a DB pension, holding DC pensions not only decreases an individuals probability of participating in the stock market, but also leads to less investments in stocks after stock market entry. Secondly, I test pension type effects on older workers investment decisions in individual retirement accounts (IRAs), over which individuals have full control. Panel analysis shows that individuals with DC pensions are more likely to hold IRAs compared to those who have DBs. I also find that individuals have rather consistent investment patterns within their pension and IRA accounts. In order to better understand how individual expected longevity evolves over time, which can affect Older Americans investment planning horizon, we propose to use the self-reported health change as a direct measure of health flows in empirical models. Our results show that after controlling for both subjective and objective measures of health status and unobserved heterogeneity in reporting, self-reported health changes are a more appropriate measure of health dynamics than those used in earlier studies. %I State University of New York at Stony Brook %V Ph. D. %P 182 %8 2006 %G eng %N AAT 3448274 %4 Stock market %$ 62450 %! The Effects of Private Pension Types on Older American Workers Portfolio Decisions and the Role of Health Measures in Understanding Expected Longevity %0 Thesis %D 2006 %T Essays on Health and Household Finances %A Salm, Martin %K Health Conditions and Status %K Net Worth and Assets %X This dissertation consists of three essays on the economics of health and household finances. The first essay investigates how subjective mortality expectations and heterogeneity in time and risk preferences affect the consumption and saving behaviors of the elderly. This study uses data on information about preferences and subjective mortality expectations from the Health and Retirement Study merged with detailed consumption data from two waves of the Consumption and Activities Mail Survey. The main results are: (1) consumption and saving choices vary with subjective mortality rates and reported time and risk preferences in a way that is consistent with the life cycle model; and (2) there is substantial heterogeneity in the estimated time discount rates and risk aversion parameters. The second essay examines the effect of job loss on health for near elderly employees. It uses longitudinal data from the Health and Retirement Study. Job loss is a major cause of economic insecurity for working age individuals, and can cause a reduction in income and loss of health insurance. To control for possible reverse causality, this study focuses on people who were laid off for an exogenous reason - the closure of their previous employers' business. This study finds no causal effect of exogenous job loss on various measures of health, which suggests that poor health of the unemployed can be explained by reverse causality. Instrumental variables regressions are used to estimate the effect of loss of health insurance, loss of income, and re-employment on health, and again there are no statistically significant effects. The third essay examines the welfare effects of tax subsidies for insurance premiums in a model of an insurance market with private information. This study finds that any second-best equilibrium can be achieved for some rate of a proportional premium subsidy. These second-best outcomes can typically not be achieved in a private insurance market without subsidies. This result suggests that subsidies for health insurance contributions, such as the tax deduction for employers' health insurance contribution in the United States, can mitigate the effects of adverse selection in health insurance markets. %I Duke University %8 2006 %G eng %4 financial resources %$ 18230 %! Essays on Health and Household Finances %0 Report %D 2006 %T Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education Programs %A Annamaria Lusardi %A Olivia S. Mitchell %K Net Worth and Assets %K Retirement Planning and Satisfaction %X 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. %B Michigan Retirement Research Center Publication %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %L newpubs20070125_Lusardi-Mitchell_wp144 %4 Financial Management/Retirement Planning/Investments %$ 17030 %R 10.2145/20070104 %0 Thesis %B Decision Sciences and Engineering Systems %D 2006 %T Financial Planning and Risk Management for Retirement: Optimal investment-consumption choices under multiple risk exposures %A Li, Zhisheng %K Net Worth and Assets %K Risk Taking %X With an increase in life expectancy and a shift from defined benefit to defined contribution plans for retirement funding, individuals are exposed to and need to manage more risks on their own. This research addresses optimal consumption and investment selections with consideration for health, financial and longevity risk. We define a health evolution model for identifying and measuring health risks in retirement planning. We construct a health status index to summarize an individual's health status, as well as a health risk factor system to identify the level of health risk of an individual. Based on maximum likelihood estimate and nonlinear least squares fitting, model calibration is formulated as mixed-integer nonlinear optimization problems. Data from the National Health Interview Survey is used to calibrate the model for specific risk groups. Longitudinal data from the Health and Retirement Study is used to validate the model. Annuities can be effective tools in managing longevity risk. In order to address this risk management problem, we develop a framework that merges annuity purchase decisions with consumption-investment selections in retirement planning. After introducing a pricing model and a benefit payment model for an annuity, we construct a multi-period wealth evolution model. An optimization problem is formulated with the objective of maximizing lifetime utility of consumptions and wealth. Optimal decisions are determined as a trade off between consumption and investment among an annuity, a risky and a risk-free asset. The health evolution model is used to capture the longevity risk in the framework. For a more sophisticated study of the management of financial risk, we formulate a wealth risk management framework which provides downside protection and upside potential. From the perspective of individual investors, we identify three major risk dimensions and construct risk measures for each risk dimension. Available assets are classified into the three risk dimensions, protective, market and aspirational, based on their risk-return profiles. All risk dimensions are optimized simultaneously through appropriate allocation of total wealth in the investment assets. We implement the framework in different market scenarios to test it, along with utilizing market data to check its performance in real world. %B Decision Sciences and Engineering Systems %I Rensselaer Polytechnic Institute %C Troy, NY %V Doctor of Philosophy %8 2006 %G eng %U http://digitool.rpi.edu:8881/R/6UBH1N52GXNGT5FIP7EK3QVKUXI4XQY887RMB84AHKCI4YTATN-00036?func=dbin-jump-full&object_id=6134&local_base=GEN01&pds_handle=GUEST %4 Financial Management %$ 17730 %0 Report %D 2006 %T Heterogeneity in Preferences and Productivity: Implications for Retirement %A Gortz, Mette %K Consumption and Savings %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper discusses the determinants of the retirement decision and the implications of retirement on economic well-being. The main contribution of the paper is to formulate the role of individual heterogeneity explicitly. We argue that individual heterogeneity in 1) productivity of market work versus housework, 2) preferences for leisure compared to consumption, and 3) marginal utility of wealth, is correlated with the retirement decision. Based on US consumption and time use data for 2001 and 2003 from the Consumptions and Activities Mail Survey (CAMS), we study the patterns of individual choices of expenditure, household production and leisure for people in and around retirement. The unobserved individual heterogeneity factor is isolated by comparing cross-sectional evidence and panel data estimates of the effects of retirement on consumption and time allocation. Based on cross-section data, we can identify a difference in consumption due to retirement status, but when the panel nature of the data is exploited, the effect of retirement on consumption is small and insignificant. Moreover, the analyses point at a large positive effect of retirement on household production. Our results therefore contribute to the discussion of the so-called retirement-consumption puzzle. Many analyses of the retirement-consumption drop assume that the retirement decision is exogenous. However, the individual decision on when to retire may depend on expected changes in consumption and time allocation. This suggests that the retirement decision is endogenous. To test this, we apply an instrumental variables method in the treatment effects tradition. %I University of Copenhagen, Dept. of Economics %G eng %U http://www/econ.ku.dk/CAM %L wp_2006/CAMwp2006-001.pdf %4 RETIREMENT/Consumption/Household Production %$ 16610 %0 Report %D 2006 %T Home Production by Dual Earner Couples and Consumption During Retirement %A Christopher L House %A John Laitner %A Stolyarov, Dmitriy %K Consumption and Savings %K Event History/Life Cycle %K Net Worth and Assets %X To study the role of home production in life cycle behavior, this paper creates a theoretical model in which both spouses in a couple allocate their time between market and home work. It then derives a pair of regression equations for estimating the parameters of the model, and it carries out the estimation using panel data on household net worth and lifetime earnings from the Health and Retirement Study and pseudo panel data on household consumption expenditures from the Consumer Expenditure Survey. We estimate that the value of forgone home production is roughly 10-15 cents for every dollar that a married man earns, but 30-35 cents per dollar of married women s market earnings. Our findings imply male labor supply elasticities that are very near zero and female elasticities in the range of 0.50. Our model predicts a substantial decline in measured consumption expenditure at a household s retirement, and it shows that Euler equation models of consumption behavior should include terms reflecting home production. %I The University of Michigan, Michigan Retirement Research Center %G eng %U http://www.mrrc.isr.umich.edu/publications/papers/ %L newpubs20070125_House_etal_wp143 %4 Life Cycle Models and Saving/Household Production/Consumption %$ 17040 %0 Report %D 2006 %T How Secure Are Retirement Nest Eggs? %A Richard W. Johnson %A Mermin, Gordon B.T. %A Cori E. Uccello %K Adult children %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %X Life s uncertainties can upend the best-laid retirement plans. Health can fail as people grow older, or their spouses can become ill. Older people can lose their jobs, and often have trouble finding new ones. Marriages can end in widowhood or divorce. Health, employment, and marital shocks near retirement can have serious financial repercussions, raising out-of-pocket medical spending, reducing earnings, disrupting retirement saving, and forcing people to dip prematurely into their nest eggs. This brief examines different types of negative events that can strike near retirement. It reports the incidence of widowhood, divorce, job layoffs, disability, and various medical conditions over a 10-year period, and estimates their impact on household wealth. Data come from the Health and Retirement Study (HRS), a nationally representative survey of older Americans conducted by the University of Michigan for the National Institute on Aging. The survey interviewed a large sample of non-institutionalized adults ages 51 to 61 in 1992 and re-interviewed them every other year. The analysis uses data through 2002, the most recent year available. The results show that many people in their 50s and 60s experience negative shocks that threaten retirement security. Job layoffs, divorce, and the onset of work disabilities near retirement substantially erode retirement savings. The findings highlight the limitations of the safety net when things go wrong in late midlife. %I Boston College, Center for Retirement Research %G eng %U http://www.bc.edu/centers/crr/ib_45.shtml %L wp_2006/CRRib_45a.pdf %4 Retirement Saving/Health Shocks/Divorce/Widowhood %$ 16370 %0 Journal Article %J Journals of Gerontology, Series B: Psychological Sciences and Social Sciences %D 2006 %T The Impact of Comorbidity on Wealth Changes in Later Life %A Hyungsoo Kim %A Jinkook Lee %K Demographics %K Healthcare %K Net Worth and Assets %X Despite the high prevalence of comorbidity in later life, scientists do not fully understand its financial impact. The objective of this study was to enhance researchers' understanding of the impact of compounded health problems on the wealth of older people. Using data from the Asset and Health Dynamics Among the Oldest Old study (1995 to 2002 waves), we conducted ordinary least squares regression analysis on wealth changes. We found that comorbidity leads to significant wealth depletion in later life, especially for single elders. Single elders with comorbidity depleted 20 to 22 of their wealth over a 2- to 3-year time period, especially those with the combination of heart disease and diabetes. The impact of comorbidity was disproportionately greater than the estimated impact of a single health problem. However, the impact of comorbidity did not appear to be significant among married people. We found that compounded health problems also create compounded financial problems in later life. For an accurate estimation of the financial consequences of health problems, it is important to consider comorbid health problems, as the effect of comorbidity is not equal to the sum of the effects of single health problems. %B Journals of Gerontology, Series B: Psychological Sciences and Social Sciences %I 61B %V 61B %P S307 %G eng %U http://psychsoc.gerontologyjournals.org/ %N 6 %L newpubs20070125_Kim-Lee_JOG %4 HEALTH-CARE COSTS/Wealth/Elderly %$ 16950 %0 Report %D 2006 %T The Impact of Misperceptions about Social Security on Saving and Well-Being %A Susann Rohwedder %A Arthur H.O. vanSoest %K Net Worth and Assets %K Social Security %X Earlier research suggests that many people in their fifties and early sixties are not well informed about their Social Security entitlements. This paper investigates the effect of deviations between predicted and realized Social Security benefits on several measures of well-being in retirement, such as the change in consumption expenditures at retirement, a self-assessed measure of how retirement years compare to the years before retirement, and whether the individual is worried about having enough income to get by in retirement. The analysis is based upon US data from the Health and Retirement Study, following individuals over a long time period from their fifties into retirement. We find clear evidence that people who over estimated their Social Security benefits are worse off according to several measures of well being in retirement. This relationship seems to be more pronounced for respondents who claimed benefits earlier than anticipated than for those who were simply misinformed. %I The University of Michigan, Michigan Retirement Research Center %G eng %U http://www.mrrc.isr.umich.edu %L wp_2006/MRRCwp118.pdf %4 Social Security/Retirement Wealth %$ 16630 %0 Newspaper Article %B New York Times %D 2006 %T Inherit the Wind; There's Little Else Left %A Porter, Eduardo %K Adult children %K Consumption and Savings %K Demographics %K Net Worth and Assets %K Retirement Planning and Satisfaction %X The latest numbers confirm that a vast majority of baby boomers cannot count on an inheritance to help them out of their jam. Even as the total pile of wealth passed down the generations has increased sharply, the inheritance received by a typical American has declined. The shift can be explained in part by demographics changes, but also by the changing nature of old age (life expectancy has increased) and retirement financing (rather, the lack of it). [The article quotes a paper by Hurd and Smith, based on the Health and Retirement Study] %B New York Times %7 Late Edition (East Coast) %C New York, N.Y %8 March 26, 2006 %G eng %N 4.1 %4 Personal finance/Retirement planning/Baby boomers/Older people/Wealth/Inheritances %$ 62599 %! Inherit the Wind; There's Little Else Left %0 Journal Article %J Journal of Women and Aging %D 2006 %T Older Women's Health and Its Impact on Wealth %A Hyungsoo Kim %K Adult children %K Health Conditions and Status %K Net Worth and Assets %B Journal of Women and Aging %I 18 %V 18 %P 75-91 %G eng %N 1 %4 womens health/Chronic Illness/Wealth/Marital Status %$ 16830 %0 Journal Article %J Journals of Gerontology, Series B: Psychological and Social Sciences %D 2006 %T The Persistence of Depressive Symptoms in Older Workers Who Experience Involuntary Job Loss: Results from the Health and Retirement Study %A William T Gallo %A Elizabeth H Bradley %A J. A. Dubin %A Richard N Jones %A Tracy Falba %A Teng, H.M. %A Stanislav V Kasl %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X Objectives. The purpose of this study was to investigate the association between involuntary job loss among workers nearing retirement and long-term changes in depressive symptoms. Methods. Analyzing data from the first four waves (1992 1998) of the Health and Retirement Survey, we used longitudinal multiple regression in order to assess whether involuntary job loss between Wave 1 and Wave 2 was associated with depressive symptoms at Wave 3 and Wave 4. The study sample included 231 workers who had experienced job loss in the Wave 1 Wave 2 interval and a comparison group of 3,324 nondisplaced individuals. We analyzed the effect of job loss on depressive symptoms both in the full study sample and in subsamples determined by wealth. Results. Among individuals with below median net worth, Wave 1 Wave 2 involuntary job loss was associated with increased depressive symptoms at Wave 3 and Wave 4. We found no effect of involuntary job loss for high net worth individuals at the later survey waves. Discussion. Our findings identify older workers with limited wealth as an important group for which the potential effect of involuntary job separation in the years preceding retirement is ongoing (enduring) adverse mental health. %B Journals of Gerontology, Series B: Psychological and Social Sciences %I 61 %V 61 %P S221-8 %G eng %N 4 %L pubs_2006_GalloJoG.pdf %4 Job Loss/Depressive Symptoms/Wealth %$ 16800 %0 Report %D 2006 %T Savings, Portfolio Choice, and Retirement Expectations %A Arthur H.O. vanSoest %A Katpeyn Arie %K Consumption and Savings %K Expectations %K Net Worth and Assets %X Studying household investment behavior is essential for understanding the full consequences of old age social security benefits. Using data from six waves of the Health and Retirement Study, we analyze the dynamics of portfolio composition before respondents start claiming social security benefits. We consider ownership as well as amounts held of several types of assets and debts. Using panel data censored regression models, portfolio adjustment is explained on the basis of demographics like gender, race, and year of birth, education level, household income, and perceived social security entitlements. We find that expectations of old age social security benefits have little effect on portfolio decisions, although there is some evidence that higher expected social security benefits lead to more risky financial investments, particularly in IRAs. %I The University of Michigan, Michigan Retirement Research Center %G eng %U http://hdl.handle.net/2027.42/49420 %L wp_2006/MRRCwp119.pdf %4 Savings/Portfolio Choice/Retirement Expectations %$ 16740 %0 Thesis %D 2006 %T Three Essays in Public Economics %A Wu, Binzhen %K Consumption and Savings %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %X The first essay uses the policy changes surrounding the 1992 Amendments to the Higher Education Act (HEA92) to examine the effects that the implicit financial-aid tax has on household saving behavior, particularly on portfolio choices. The empirical results show that the financial-aid tax does not significantly affect the total level of wealth. However, families significantly adjust their portfolio composition to avoid the tax. In addition, families seem to lack knowledge about financial-aid rules if they have not experienced with the financial-aid applications. Even if families know the rules, they do not change assets in response to the financial-aid tax if they face no imminent taxation. This second essay uses the policy changes surrounding the 1992 Amendments to the Higher Education Act (HEA92) to examine the reasons for which families have borrowed much more after the HEA92 increased the loan limits on subsidized and unsubsidized student loans. I find that the loan-limit changes do not significantly affect education investments. However, families significantly reduce some other financial instruments used to finance students' higher education, including loans from parents, parents' direct contributions, working while in school, and work-study aid. The third essay uses the Health and Retirement Study to study the effects of group health insurance on women's retirement decisions. I find the availability of alternative group health insurance, including retiree health insurance and spousal health insurance, significantly increases the retirement hazard and decreases retirement age for women. Married women are much more sensitive to the availability of spousal health insurance than to retiree health insurance. Medicare also has significant effect on women' retirement behavior. %I The University of Wisconsin - Madison %C United States -- Wisconsin %8 2006 %G eng %4 Economics %$ 17530 %0 Report %D 2005 %T Are DC Plans Tools for Learning? Pension Design, Financial Education, and Portfolio Choice for Older Workers %A Seligman, Jason S. %A Bose, Rana %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X This work considers the potential for Defined Contribution (DC) pension plans to educate and affect better overall asset management though participation. We engage six waves of the Health and Retirement Survey to investigate whether household exposure to active management or participation in plan sponsored financial education impact portfolio allocations and wealth. We consider outcomes both within and outside of the worker s DC plan, allow for simultaneous allocation decisions via multivariate probit specifications, and construct a synthetic counterfactual via propensity score matching to test our results. We find repeated evidence that both of the plan features we test improve asset allocations and financial outcomes. %I University of Georgia %G eng %L wp_2005/SeligmanBose.pdf %4 Pension Plans/RETIREMENT/Financial Management/Portfolio Choice %$ 16580 %0 Report %D 2005 %T Changes in Wealth for Americans Reaching or Just Past Normal Retirement Age %A Copeland, Craig %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This Issue Brief provides a first step in determining how retirees now starting to retire those first to be affected by the shift to lump-sum payments and 401(k) asset accumulation.are managing their wealth. Americans born from 1931 1941 are the focus of this study, since these Americans ranged in age from 51 61 in 1992 (at the beginning of the study period) and had reached age 61 71 by 2002 (the end of the study period). These Americans have been affected by fundamental changes in the employment-based retirement plan market, as fewer people are covered by defined benefit pension plans and more people are covered by defined contribution plans, principally the 401(k) plan. This shift has led to tremendous growth in IRA assets, as workers used these tax-favored savings vehicles to roll over their defined contribution and/or defined benefit assets upon job change or retirement. %I Employee Benefit Research Institute, EBRI Issue Brief No. 277 %G eng %U http://www.ebri.org/ibs/ %L wp_2005/EBRI_ib277.pdf %4 Retirement Wealth/Retirement Policies %$ 14292 %0 Book Section %B Analyses in the Economics of Aging %D 2005 %T Discussion of James Poterba, Joshua Rauh, Steven Venti and David Wise, Utility Evaluation of Risk in Retirement Savings Accounts %A Robert J. Willis %E David A Wise %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %K Risk Taking %B Analyses in the Economics of Aging %I University of Chicago Press %C Chicago %P 53 %G eng %4 retirement Planning/pension Wealth/risk Aversion/Stock Market/Public Policy %$ 23490 %! Discussion of James Poterba, Joshua Rauh, Steven Venti and David Wise, Utility Evaluation of Risk in Retirement Savings Accounts %0 Report %D 2005 %T Enhancing the Quality of Data on Income and Wealth %A Cao, Honggao %A Daniel H. Hill %A Juster, F. Thomas %A Michael M. Perry %K Income %K Methodology %K Net Worth and Assets %X Over the last decade or so, a substantial effort has gone into the design of a series of methodological investigations aimed at enhancing the quality of survey data on income and wealth. These investigations have largely been conducted at the Survey Research Center at the University of Michigan, and have mainly involved two longitudinal surveys: the Health and Retirement Study (HRS), with a first wave beginning in 1992 and continued thereafter every other year through 2004; and the Assets and Health Dynamics Among the Oldest Old (AHEAD) Study, begun in 1993 and continued in 1995 and 1998, then in every other year through 2004. This provides and overview of the main studies and summarizes what has been learned about correcting longitudinal inconsistencies that arise. %I The University of Michigan, Michigan Retirement Research Center %G eng %U http://www.mrrc.isr.umich.edu/publications/papers/ %L wp_2005/MRRCwp101.pdf %4 Assets/income/Methodology %$ 16460 %0 Report %D 2005 %T Financial Literacy and Planning: Implications for Retirement Well-Being %A Annamaria Lusardi %A Olivia S. Mitchell %K Net Worth and Assets %K Retirement Planning and Satisfaction %X 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. %I The University of Michigan, Michigan Retirement Research Center %G eng %L wp_2005/MRRCwp108.pdf %4 Financial Management/Retirement Planning %$ 15600 %0 Thesis %D 2005 %T Financial Management Assistance Use by the Vulnerable Elderly %A Kim, Eun-Jin %K Health Conditions and Status %K Net Worth and Assets %X The rapid growth of the elderly population raises concerns in the United States for older people's well-being. Effective financial management is important to the well-being of retired people since the elderly are more likely to face limited financial resources and complicated financial management tasks, such as navigating health care insurance payments and managing stocks. One way for the elderly to successfully manage their finances is to seek assistance from others. This study uses the 2000 Health and Retirement Study to examine factors affecting financial management assistance use by the elderly (individuals 65 years and older) facing difficulties managing their own finances. "Vulnerability" is suggested as a factor affecting financial management assistance use by the elderly. Vulnerability is a multidimensional concept incorporating health status, cognitive ability, and social interaction factors. The vulnerable elderly have health problems, reduced cognitive skills, and are often socially isolated due to the death of a spouse or retirement. Persons 65 years and older were found to be more vulnerable than persons younger than 65 years in terms of health status, cognitive ability, and social interaction. (n = 11,492). Since vulnerability is more prevalent among the older people, the study sample was limited to persons 65 years and older. Elderly persons reporting difficulty with financial management were studied to identify factors affecting financial management assistance use by the vulnerable elderly (n = 271). Logistic regression analysis revealed that age, presence of an IADL problem, depression, and computation ability affect older people's financial management assistance use. Elderly who are older, not depressed, and have an IADL problem and computation inability are more likely to use financial management assistance. Since depressed elderly persons are less likely to use assistance even if they have difficulties managing finances, the depressed elderly may be in a vulnerable situation with respect to effective financial management. Interventions related to financial management may improve the financial well-being of the depressed elderly. The findings of this study suggest that the factors determining older people's use of financial management assistance are physical and mental health status and cognitive ability rather than economic status. %I The Ohio State University %C Columbus, OH %V Doctor of Philosophy %8 2005 %G eng %U https://search.proquest.com/openview/d0634e9707b21bd4b553b149b5d2c8e9/1?cbl=18750&diss=y&pq-origsite=gscholar %4 Financial Management %$ 15440 %0 Book Section %B Analyses in the Economics of Aging %D 2005 %T Healthy, Wealthy, and Knowing Where to Live: Trajectories of Health, Wealth, and Living Arrangements among the Oldest Old %A Florian Heiss %A Michael D Hurd %A Axel Borsch-Supan %E David A Wise %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %X There are many mechanisms that suggest that living arrangements and well-being derived from health and economic status are closely related. This paper investigates the joint evolution of the three conditions, using a microeconometric approach similar to what is known as vector autoregressions (VAR) in the macroeconomics literature. %B Analyses in the Economics of Aging %I University of Chicago Press %C Chicago %P 241-275 %G eng %L wp_2003/Heiss-Hurd-Supan_NBER9897.pdf %4 Health Status/Wealth/Living Standards %$ 11622 %+ NBER Working Paper 9897. Copies available from: National Bureau of Economic Research, 1050 Massachusetts Avenue,Cambridge, MA 02138. %! Healthy, Wealthy, and Knowing Where to Live: Trajectories of Health, Wealth, and Living Arrangements among the Oldest Old %R 10.3386/w9897 %0 Report %D 2005 %T HRS 2001 HUMS College Tuition Imputations %A Cao, Honggao %A John C Henretta %A Norgard, T.M. %A Beth J Soldo %A David R Weir %K Consumption and Savings %K Methodology %K Net Worth and Assets %X HRS 2001 Off-Year Mail Survey on Human Capital Investment (HRS 2001 HUMS) collected important information on the education of HRS respondents children. Among other things, the survey asked a selected set of HRS respondents to provide information about whether a child attended a two- or four-year undergraduate college, the total number of years in college(s), his or her age when he or she last attended college, and the name of the college that he or she last attended. One way to use the information is to produce college tuition data associated with each child, which can then be linked in an integrated analysis of family transfer with other family transfer information collected in the HRS core survey. In this document we describe what we have done in imputing HRS 2001 HUMS college tuitions. The general idea is to link the children college attendance information in HRS 2001 HUMS with a college tuition database (CASPAR) created and administered by the National Science Foundation. For 2000 and 2001, college cost data are also taken from the NCES IPEDS online database. %I Institute for Social Research, University of Michigan %C Ann Arbor, Michigan %G eng %4 imputations/methodology/human Capital/college tuition %$ 62890 %0 Thesis %B Sociology %D 2005 %T The Impact of Marital Status on the Economic Well-Being of Women in Later Life %A Joyce, Joyce Ann %K Adult children %K Demographics %K Income %K Net Worth and Assets %K Women and Minorities %X Although there have been significant improvements in the economic status of the elderly in the United States because of the Social Security retirement program and the Supplemental Security Income (SSI) program, poverty among older women remains high. The economic vulnerability of women in older age has been directly linked to their greater likelihood of being unmarried, with marriage viewed as generally protecting the elderly from poverty. The economic status of older women also has been linked to their employment histories, in that women tend to have discontinuous work histories and often work at jobs that pay lower salaries than men. Moreover, their employment is often tied to marriage and childrearing. These factors mean many women will receive lower income in older age. Hence, a lifetime of weak attachment to the labor force leaves many women ill-prepared for economic security without a spouse. Other characteristics of women may further impact their income security in older age. Minority women, for example, are at an even greater disadvantage than white women; and women with high educational attainment may have strong work histories resulting in more favorable outcomes for income in later life. Within the context of a combination of viewpoints that include the life course, political economy, and feminist perspectives, this dissertation examines the relationship of gender, race, employment histories, number of children, and marital status on the economic security of women in later life. Economic security is measured by total household income and total wealth, or accumulated assets minus debt. A sample of women age 50 and over who are married, divorced, widowed, or have never been married are included in the study. Data are from the Rand Data File of the Health and Retirement Study. The Rand HRS Data File is a longitudinal data set based on the Health and Retirement Study (HRS) data. The HRS is a national panel study sponsored by the National Institute of Aging and conducted by the University of Michigan. From the data analysis, it was found that married women, overall, have greater income and wealth and, therefore, the largest number of sources of income compared to women in the other marital status groups. This was due largely to their access to their spouse's income and assets. The widowed women were shown to have the least amount of wage and salary income, but received the most from Social Security retirement. The widows in the study, however, had the least amount of total household income. Those women who had never been married had the strongest employment histories among the women in the four marital status groups, but they had less income and wealth than the married women in the sample. The race and ethnicity of the women were shown to have negative consequences for their economic security, with nonwhite women having fewer sources of income than their white counterparts. Education had a significant positive effect on the incomes and wealth of the women across all the marital status groups, while number of children had no effect on either the income or assets of women in this analysis. %B Sociology %I State University of New York - Buffalo %C Buffalo, NY %V Doctor of Philosophy %8 2005 %G eng %U https://search.proquest.com/openview/8c849816074ff7095b8942c9c7b78a28/1?cbl=18750&diss=y&pq-origsite=gscholar %4 Widowhood %$ 15750 %0 Report %D 2005 %T The Impact of SES on Health over the Life Course %A James P Smith %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X People of lower socio-economic status (SES) have much worse health outcomes (Marmot (1999), Smith (1999)). But why this is so remains under considerable debate ((Adams et al. (2003), Deaton (2003)). A central question is whether these large differences in health by such SES indicators as income or wealth largely reflect causation from SES to health. But even if SES mainly affects health, what dimensions of SES actually matter financial aspects such as income or wealth or non-financial dimensions like education? %B RAND Working Paper %I RAND Labor and Population Program %C Santa Monica, CA %G eng %L wp_2005/RAND_WR318.pdf %4 Health/financial resources/Education %$ 15680 %R https://doi.org/10.7249/WR318 %0 Report %D 2005 %T Medicaid: Transfers of Assets by Elderly Individuals to Obtain Long-Term Care Coverage %A United States Governmental Office %K Adult children %K Healthcare %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %X In fiscal year 2004, the Medicaid program financed about $93 billion for long-term care services. To qualify for Medicaid, individuals' assets (income and resources) must be below certain limits. Because long-term care services can be costly, those who pay privately may quickly deplete their assets and become eligible for Medicaid. In some cases, individuals might transfer assets to spouses or other family members to become financially eligible for Medicaid. Those who transfer assets for less than fair market value may be subject to a penalty period that can delay their eligibility for Medicaid. GAO was asked to provide data on transfers of assets. GAO reviewed (1) the level of assets held and transferred by the elderly, (2) methods used to transfer assets that may result in penalties, (3) how states determined financial eligibility for Medicaid long-term care, and (4) guidance the Centers for Medicare & Medicaid Services (CMS) has provided states regarding the treatment of asset transfers. GAO analyzed data on levels of assets and cash transfers made by the elderly from the 2002 Health and Retirement Study (HRS), a national panel survey; analyzed states' Medicaid applications; and interviewed officials from nine states about their eligibility determination processes. In 2002, over 80 percent of the approximately 28 million elderly households (those where at least one person was aged 65 or over) had annual incomes of $50,000 or less, and about one-half had nonhousing resources, which excluded the primary residence, of $50,000 or less. About 6 million elderly households (22 percent) reported transferring cash, with amounts that varied depending on the households' income and resource levels. In general, the higher the household's asset level, the more likely it was to have transferred cash during the 2 years prior to the HRS study. Overall, disabled elderly households--who are at higher risk of needing long-term care--were less likely to transfer cash than nondisabled elderly households. Certain methods to reduce assets, such as spending money to pay off debt or make home modifications, do not result in penalty periods. Other methods, such as giving gifts, transferring property ownership, and using certain financial instruments, could result in penalty periods, depending on state policy and the specific arrangements made. None of the nine states GAO contacted tracked or analyzed data on asset transfers or penalties applied. These states required applicants to provide documentation of assets but varied in the amount of documentation required and the extent to which they verified the assets reported. These states generally relied on applicants' self-reporting of transfers of assets, and officials from these states informed GAO that transfers not reported were difficult to identify. To help states comply with requirements related to asset transfers, CMS has issued guidance primarily through the State Medicaid Manual. CMS released a special study in 2005 to help states address the issue of using annuities as a means of sheltering assets. Additionally, CMS officials provide ongoing technical assistance in response to state questions, but noted the challenge of issuing guidance applicable to all situations given the constantly changing methods used to transfer assets in an attempt to avoid a penalty period. In commenting on a draft of this report, CMS noted the complexity of the current law and commented that data on the precise extent and cost of asset transfers to the Medicaid program have been difficult to gather. %B GAO Report %I U.S. Government Accountability Office %C Washington, DC %G eng %U http://www.gao.gov/cgi-bin/getrpt?GAO-05-968 %L wp_2005/GAOrpt-Medicaid.pdf %4 Assets/Transfers/Long-Term Care/Medicaid %$ 15290 %0 Report %D 2005 %T Retirement, Saving, Benefit Claiming and Solvency Under a Partial System of Voluntary Personal Accounts %A Alan L Gustman %A Thomas L. Steinmeier %K Consumption and Savings %K Net Worth and Assets %K Social Security %X This paper is based on a structural model of retirement and saving, estimated with data for a sample of married men in the Health and Retirement Study. The model simulates how various features of a system of personal Social Security accounts jointly affects retirement, saving, the choice of whether benefits are taken as an annuity or lump sum, taxes paid and the course of benefits with age. Among our findings: Under a system of partial personal accounts, the fraction of 62 year olds at full time work would decline by about 22 percent compared to retirements under the current benefit formula. If the current system were replaced completely by personal accounts, the fraction at full time work would decline by about a third. If all benefits from personal accounts could be taken as a lump sum, the fraction not retired at age 62 would fall by about 5 percentage points compared to a system where there is mandatory annuitization of benefits. Unless annuitization is mandatory, there would be substantial diversion of benefits to age 62, reducing benefits received in one s 70s and 80s by 20 percent or more. %B Michigan Retirement Research Center Publication %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/pubs/retirement-saving-benefit-claiming-and-solvency-under-a-partial-system-of-voluntary-personal-accounts-2/ %L wp_2006/MRRCwp121.pdf %4 Retirement Saving/Social Security/Annuities %$ 16450 %0 Thesis %D 2005 %T A Slippery Slope: Essays on Income, Wealth, and the Health Gradient %A Wenzlow, Audra T. %K Health Conditions and Status %K Income %K Net Worth and Assets %X The relationship between health and socioeconomic status (SES), often called the health gradient, is a complex and perplexing research puzzle. Individuals with higher incomes tend to be healthier (although at a declining rate with higher income), yet it is unclear why this is so. Here, I argue that wealth and savings, largely neglected in past empirical work, provide important insights into the health-SES relationship. An empirical model in which income and wealth are transformed using the inverse hyperbolic sine is shown to capture important variations in health throughout the income and wealth distributions for U.S. working-age adults. The three-dimensional gradient in income, wealth, and health illustrates two patterns that are investigated in the following chapters: the predominance of poor health among those with little savings, and variations in health disparities by wealth over the life cycle. Panel data from the Health and Retirement Study are used to investigate a likely mode through which wealth may have a causal effect on health among the poor: through financial constraints that limit access to health care at the time of illness. I capitalize on recent research suggesting that income and wealth do not cause the onset of certain acute illnesses, conditional on past health. Viewing unexpected costs associated with such illnesses as financial shocks, I find that approximately one quarter of the population that experiences a stroke, cancer, heart problem, or high blood pressure has insufficient liquid assets to cover typical costs of unexpected medical care. Furthermore, this study suggests that a causal relationship between lack of savings and health recovery is plausible, possibly contributing to the steep slope of the gradient about zero. In the final chapter, I test a number of hypotheses that could account for the observed life cycle pattern of declining socioeconomic disparities in health in old age. I find that poor measurement of financial resources and possible cohort, Medicare, or retirement effects, but not attrition, are likely contributors to this phenomenon. Taking into account life-cycle patterns of income receipt and wealth decumulation, I find a large health gradient in wealth among the oldest old. %I The University of Wisconsin - Madison %8 2005 %G eng %4 Health Shocks %$ 15730 %! A Slippery Slope: Essays on Income, Wealth, and the Health Gradient %0 Journal Article %J Journal of Public Economics %D 2005 %T The Social Security Early Entitlement Age In A Structural Model of Retirement and Wealth %A Alan L Gustman %A Thomas L. Steinmeier %K Methodology %K Net Worth and Assets %X A structural life cycle model of retirement and wealth attributes retirement peaks at both ages 62 and 65 to Social Security rules and wide heterogeneity in time preferences. Those with high discount rates often retire at 62. They have few assets and heavily value lost benefits from working after 62, largely ignoring potential increases in later benefits. Declining actuarial adjustments beginning at 65 induce those with low discount rates to retire at 65. Raising the Social Security early entitlement age to 64 induces 5 of the population to delay retiring, shifting the retirement spike from 62 to 64. %B Journal of Public Economics %I 89 %V 89 %P 441-463 %G eng %N 2-3 %L pubs_2005_SocSecEarlyEnt.pdf %4 Social Security Research/Retirement Wealth %$ 6632 %R https://doi.org/10.1016/j.jpubeco.2004.03.007 %0 Thesis %D 2005 %T Three Essays on Retirement Wealth %A Walker, Lina %K Adult children %K Healthcare %K Housing %K Net Worth and Assets %X One of the central questions in economics is what motivates savings. This question is important for a number of reasons, one of which is it provide a benchmark for evaluating whether households are financially prepared for retirement. This is particularly relevant given the aging of the baby boom cohort, where the anticipated surge in the number of elderly persons could exert considerable pressure on the budgets of existing government programs. My dissertation includes three essays that focus on some of the current themes in the ongoing debate over the motivation for savings. The first essay focuses on the tendency among the elderly to hold onto their homes and examines whether this behavior is consistent with the notion that housing wealth is insurance against out-of-pocket medical expenses in retirement. I find that housing sales for single households is mostly driven by worsening health and it suggests that homeowners are selling because of a change in demand for housing services. Among married households, there are indications that some households are selling in order to access housing equity; however, the magnitude of the effect is very small. Taken together, the evidence does not lend much validity to the insurance story. The second essay examines the effect of uncertain nursing home expenses in retirement on savings behavior. Using differences in differences, I find that households with lower exposure to nursing home expenses accumulate lower retirement wealth. The results suggest that households are responsive to the incentives embedded in the Medicaid program and they are forward-looking in their savings decisions. The third essay focuses on the tendency among parents to leave equal inheritances to all their children. The paper examines the pattern of bequest giving and attempts to draw a picture of what motivates bequests. I find that the larger the differences among children, the more likely the decedent deviates from equal giving. These differences include differences in children's resources and differences in time assistance to parents. Among decedents that choose unequal division, bequests appear to be motivated by exchange. Among decedents that choose equal division, bequests are consistent with altruist preferences. %I University of Michigan %C Ann Arbor, MI %8 2005 %G eng %U https://www.proquest.com/docview/305459722 %4 Bequests %$ 19340 %! Three Essays on Retirement Wealth %0 Book Section %B Analyses in the Economics of Aging %D 2005 %T Utility Evaluation of Risk in Retirement Saving Accounts %A James M. Poterba %A Joshua Rauh %A Steven F Venti %A David A Wise %E David A Wise %K Net Worth and Assets %K Retirement Planning and Satisfaction %X The shift from defined benefit to defined contribution plans in the United States has drawn new attention to the effect of participants' asset allocation decisions on their financial resources for retirement. This paper develops a stochastic simulation algorithm to evaluate the effect of holding a broadly diversified portfolio of common stocks, or a portfolio of index bonds, on the distribution of 401(k) account balances at retirement. We compare the alternative distributions of retirement wealth both by showing the empirical distribution of potential wealth values, and by computing the expected utility of these outcomes under standard assumptions about the structure of household preferences. Our analysis highlights the critical role of other sources of wealth, such as Social Security, defined benefit pension annuities, and saving outside retirement plans in determining the expected utility cost of holding equities in the retirement account. Our findings also demonstrate the importance of the equity premium in affecting investors' utility from different retirement asset allocations. Viewed from the beginning of a working career, and given the historical pattern of returns on stocks and bonds, a household that does not have extremely high risk aversion would achieve a higher expected utility by holding a portfolio of stocks rather than bonds. %B Analyses in the Economics of Aging %I University of Chicago Press %C Chicago %G eng %L wp_2003/Poterba-etal_NBER9892.pdf %4 Assets/Retirement Planning/Retirement Wealth %$ 11572 %+ NBER Working Paper 9892. Copies available from: National Bureau of Economic Research, 1050 Massachusetts Avenue,Cambridge, MA 02138. %! Utility Evaluation of Risk in Retirement Saving Accounts %R 10.3386/w9892 %0 Report %D 2005 %T Valuing Lost Home Production in Dual-Earner Couples %A John Laitner %A Christopher L House %A Stolyarov, Dmitriy %K Employment and Labor Force %K Net Worth and Assets %K Women and Minorities %X Economists principal tool for studying household behavioral responses to changes in tax and other government policies, and the magnitude and determinants of private saving, is the life cycle model. The purpose of this paper is to attempt to incorporate into that model one of the most conspicuous changes in the U.S. economy in the last 50 years, the rise in labor market participation for married women. The increased presence of married women in the labor force has obvious benefits: women now earn much more income than they did in the past. On the other hand, working women presumably spend less time doing housework and other types of home production, and the forgone value of time at home reduces the net benefit of their work in the market. Conventional accounts do not provide measurements of the costs of lost home production, but we attempt to use comparisons of household net worth at retirement to deduce valuations indirectly. This paper modifies a standard life cycle model to include women s labor supply decisions, estimates key parameters of the new specification, and attempts to assess the significance of rising female labor market participation for aggregate national saving in the U.S. Using panel data from the Health and Retirement Study, we find that the difference between measured labor market earnings for married women and earnings net of the value of lost home production seems moderately small about 30 percent and that the corresponding long run effect on the overall rate of private saving is minor. %B Michigan Retirement Research Center Publication %I The University of Michigan, Michigan Retirement Research Center %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/pubs/valuing-lost-home-production-in-dual-earner-couples/ %L wp_2005/MRRCwp097.pdf %4 Household Production/Labor Force Participation/WOMEN %$ 16500 %0 Journal Article %J Journals of Gerontology, Series B: Psychological and Social Sciences %D 2005 %T Widow(er) Poverty and Out-of-Pocket Medical Expenditures Near the End of Life %A Kathleen McGarry %A Robert F. Schoeni %K Income %K Net Worth and Assets %X Objectives. Elderly widows are three times as likely to live in poverty as older married people. This study investigates the gap in poverty, income, and wealth between these groups. Focus is placed on the role played by out-of-pocket medical expenditures spent on dying spouses. Methods. A national panel survey of people age 70 and older in 1993 was used. Income, poverty, wealth, and out-of-pocket expenditures were examined before and after widowhood, with comparisons made with couples not experiencing a death. Results. Forty-four percent of the difference in economic status between widow(er)s and married elderly persons was due to disparities in economic status that existed prior to widowhood. The remaining 56 was due to factors more directly related to the death of a spouse, including the loss of income and expenses associated with dying. On average, out-of-pocket medical expenditures in the final 2 years of life were equal to 30 of the couple's annual income. For couples in the bottom quarter of the income distribution, these expenditures were 70 of their income. Discussion. As policy makers continue to debate expansions and reforms of Medicare, the potential effects of these reforms on economic well-being, particularly among widows, should be considered. Despite the overwhelming success and popularity of programs such as Social Security and Medicare, some subgroups of the elderly population continue to face substantial risks of living in poverty. Whereas the poverty rate for elderly individuals is now hovering at 10 , the poverty rate for elderly widows is nearly twice as high. When examining poverty rates for women in particular, one finds that approximately 5 of married elderly persons are poor compared with 17 of widows (Figure 1). Although policy makers have repeatedly expressed concern about these high rates and enacted legislation attempting to improve the well-being of surviving spouses, the figure demonstrates that this gap has stubbornly remained (see endnote 1). Obviously, the more that is known about the causes and characteristics of poverty among widows, the better targeted public policy can be. %B Journals of Gerontology, Series B: Psychological and Social Sciences %I 60B %V 60B %P S160-S168 %G eng %U http://psychsoc.gerontologyjournals.org/contents-by-date.0.shtml %N 3 %L pubs_2005_McGarrySchoeni.pdf %4 Widowhood/Poverty/income/Wealth %$ 16210 %0 Book Section %B Perspectives on the Economics of Aging %D 2004 %T Aging and Housing Equity: Another Look %A Steven F Venti %A David A Wise %E David A Wise %K Adult children %K Housing %K Net Worth and Assets %X Prior research has shown that except for Social Security and employer-provided pension assets, housing equity is the most important asset of a large fraction of older Americans. These assets are the primary source of retirement consumption. This paper looks at the change in the home equity of older families as they age. The two ways for households to change home equity are by discontinuing home ownership- an action that seems to be fairly unlikely- or by selling and moving to another home. Findings suggest that housing equity increases with age until about age 75 and then declines slightly as households grow older. In general, home equity should not be counted on to support general non-housing consumption needs as households grow older. %B Perspectives on the Economics of Aging %I University of Chicago Press %C Chicago %G eng %U http://www.nber.org/papers/w8608 %L wp_2001/venti-wise_NBER8608.pdf %4 Home Ownership/Family Structure/Housing Equity/Economic Status %$ 6627 %+ Revision of NBER Working Paper No. 8608 %! Aging and Housing Equity: Another Look %0 Report %D 2004 %T Annuitized Wealth at Older Ages: Evidence from the Health and Retirement Study %A Richard W. Johnson %A Burman, Leonard E. %A Kobes, Deborah I. %K Net Worth and Assets %I Washington, DC, The Urban Institute %G eng %4 Annuities/Retirement Wealth %$ 13342 %0 Report %D 2004 %T Bulls, Bears and Retirement Behavior %A Courtney Coile %A Phillip B. Levine %K Net Worth and Assets %K Retirement Planning and Satisfaction %X The historic boom and bust in the stock market over the past decade had the potential to significantly alter the retirement behavior of older workers. Previous research examining the impact of wealth shocks on labor supply supports the plausibility of this hypothesis. In this paper, we examine the relationship between stock market performance and retirement behavior using the Health and Retirement Study (HRS), Current Population Survey (CPS), and Survey of Consumer Finances (SCF). We first present a descriptive analysis of the wealth holdings of older households and simulate the labor supply response among stockholders necessary to generate observed patterns in retirement. We show that few households have substantial stock holdings and that they would have to be extremely responsive to market fluctuations to explain observed labor force patterns. We then exploit the unique pattern of boom and bust along with variation in stock exposure to generate a double quasi-experiment, comparing the retirement and labor force re-entry patterns over time of those more and less exposed to the market. Any difference in behavior that emerged during the boom should have reversed itself during the bust. We find no evidence that changes in the stock market drive aggregate trends in labor supply. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge, MA %G eng %4 Retirement Behavior/Stock Market %$ 13392 %R 10.3386/w10779 %0 Journal Article %J Social Security Bulletin %D 2004 %T The Economic Consequences of a Husband's Death: Evidence from the HRS and AHEAD %A Purvi Sevak %A David R Weir %A Robert J. Willis %K Net Worth and Assets %X This article examines the economic status of older widowed women in the 1990s using the Health and Retirement Study. Widowhood remains an important risk factor for transition into poverty, although somewhat less so than 20 years ago. Despite increased labor force participation rates among women and Employee Retirement Income Security Act (ERISA) reforms, widows live with lower household earnings, pension income, and wealth than do married women. Women widowed at younger ages are at greatest risk for economic hardship after widowhood and their situation declines with the duration of widowhood. We also find that women in households that are least prepared financially for widowhood are at greatest risk of husband's death, because of the strong relationship between mortality and wealth. %B Social Security Bulletin %I 65 %V 65 %P 31-44 %G eng %U https://www.ssa.gov/policy/docs/ssb/v65n3/v65n3p31.html %N 3 %L pubs_2004_Sevak_SSB.pdf %4 Widowhood/Economic Status %$ 13462 %0 Thesis %D 2004 %T The Effects of Mortgage Debt on Assets and Total Resources among Near-Retirement Households %A Palmer, Lance %K Housing %K Methodology %K Net Worth and Assets %X This study investigated the long-term relation between household leverage through the use of mortgages, and changes in household wealth using the theoretical framework of the life cycle income hypothesis. This study used the 1992 through 2002 waves of the Health and Retirement Study. The characteristics of leveraged and unleveraged households were compared. The relation between household leverage and changes in assets and total resources over the period was modeled using robust regression analysis. Retained or incurred mortgage debt during the study period, relative to not having mortgage debt, had a consistent negative effect on changes in assets and total resources. However, for high-income and more risk-tolerant households, mortgage debt was beneficial and enhanced increases in assets and total resources. Implications for consumers, financial professionals, educators, and tax policymakers were drawn from the results of the study. %I Utah State University %C United States -- Utah %8 2004 %G eng %U https://search.proquest.com/openview/a713eff33873142dc139d2912574e6df/1?cbl=18750&diss=y&pq-origsite=gscholar %4 Home economics %$ 17680 %! The Effects of Mortgage Debt on Assets and Total Resources among Near-Retirement Households %0 Report %D 2004 %T Effects of Stock Market Fluctuations on the Adequacy of Retirement Wealth Accumulation %A Engen, Eric M. %A William G. Gale %A Cori E. Uccello %K Net Worth and Assets %X This paper examines the relation between fluctuations in the aggregate value of equities and the adequacy of households saving for retirement. We find that many and perhaps most households appear to be saving adequate amounts for retirement, but almost no link between stock values and the adequacy of retirement saving. Historical variation in equity values and ownership correlates poorly with historical variation in the adequacy of saving. Even a simulated 40 percent decline in stocks has little effect on the adequacy of saving. The results occur because equities are concentrated among households with significant amounts of other wealth. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/effects-of-stock-market-fluctuations-on-the-adequacy-of-retirement-wealth-accumulation/ %L wp_2004/Engen_etal2004-16.pdf %4 Stock Market/Retirement Wealth %$ 12462 %0 Thesis %B Economics %D 2004 %T Essays on Elderly Labor Force Participation, Pension Structure, and Partial Retirement %A Sharon Lynn Hermes %K Employment and Labor Force %K Healthcare %K Net Worth and Assets %X Increasingly, older Americans are postponing retirement or re-entering the workforce after retirement. This research examines the effect of pension structure changes and the different ways older workers partially retire by transitioning from full time work to part-time work, by changing jobs, or by returning to work from full retirement. Defined contribution pension growth makes retirement income increasingly tied to financial markets, implying that older workers need to postpone retirement in recessions, precisely when jobs are scarce. Using data from the Health and Retirement Study, a difference-in-differences analysis comparing older workers with defined benefit and defined contribution pensions before and after the stock market crash in 2000 reveals that the probability of retirement for people aged 63-64 with only defined contribution pensions fell by over 34 percentage points from 1998 to 2002. As men and women work longer, partial retirement has become an important option for older workers. Studies suggest that workers in the private sector cannot work fewer hours as they age on their career job because defined benefit pensions restrict inservice distributions prior to the plan's normal retirement age. Using an instrumental variables regression, I find little evidence ERISA regulated defined benefit pensions cause partial retirees to change employers prior to attaining the normal retirement age. However, many older workers not affected by ERISA also change jobs in partial retirement, which suggests the presence of constraints not identified in the model or that changing employers is in itself desirable as people age. Although partial retirement usually refers to workers voluntarily transitioning from full-time work to complete retirement, health or financial problems may be causing these changes. I find partial retirees are less healthy than similar full-time workers and report their health constrains work ability. In addition, over 26% of partial retirees return to work after retirement and hourly wages of partial retirees (previously retired) fall substantially more than hourly wages of partial retirees who transitioned directly from full-time work. Regression analysis indicates retirees with defined benefit pensions rarely return to work. Women, though return to work if their spouse's health deteriorates, while men re-enter the workforce if their spouse works. %B Economics %I University of Notre Dame %V Doctor of Philosophy %8 2004 %G eng %U https://curate.nd.edu/show/2z10wq0045w %4 Gerontology %$ 17620 %0 Book Section %B Pension Design and Structure: New Lessons from Behavioral Economics %D 2004 %T Financial Education and Saving %A Annamaria Lusardi %E Olivia S. Mitchell %E Utkus, S. %K Education %K Net Worth and Assets %K Retirement Planning and Satisfaction %X 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. %B Pension Design and Structure: New Lessons from Behavioral Economics %I Oxford University Press %G eng %U https://www.dartmouth.edu/~alusardi/Papers/Financial_Education_2004.pdf %4 Financial Management/Retirement Education/Retirement Planning/Education, Financial %$ 12632 %! Financial Education and Saving %0 Journal Article %J Hallym International Journal of Aging %D 2004 %T Financial Status of Older Americans Aged 70 and Above: A comparison of successive age cohorts %A Lee, Yoon G. %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X Using data from the 1994 Survey of Asset and Health Dynamics among the Oldest Old (AHEAD), this study examines the economic status of older individuals aged 70 or older, while comparing income sources and financial portfolios across four age cohorts (70-74, 75-79, 80-84, and 85 or older). Ordinary least squares (OLS) regression analyses with dummy variables for age were used to identify the effects of different age cohorts on the level of financial assets, home equity, and net worth. Older individuals aged 85 and older had significantly lower net worth than did those aged 70-74 older. This study further investigates the factors influencing the level of net worth for each of the four age groups. Implications and conclusions are drawn based on the findings of the study. %B Hallym International Journal of Aging %I 6 %V 6 %P 37-55 %G eng %N 1 %4 Old Age/Net Worth/Racial Differences/Assets %$ 16240 %R 10.2190/PTWP-2A96-6UM6-99WU %0 Report %D 2004 %T Health and Wealth of Elderly Couples %A Pierre-Carl Michaud %A Arthur H.O. vanSoest %K Adult children %K Demographics %K Health Conditions and Status %K Net Worth and Assets %I RAND Labor and Population Series %G eng %L wp_2004/RAND_WR191.pdf %4 Health/Wealth/Elderly/Couples %$ 13632 %0 Journal Article %J Journal of Pension Economics and Finance %D 2004 %T Household Annuitization Decisions: Simulations and empirical analyses %A Irena Dushi %A Anthony Webb %K Net Worth and Assets %X Annuities provide insurance against outliving one s wealth. Previous studies have indicated that, for many households, the value of the longevity insurance should outweigh the actuarial unfairness of prices in the voluntary annuity market. Nonetheless, voluntary annuitization rates are extremely low. Previous research on the value of annuitization has compared an optimal decumulation of unannuitized wealth with the alternative of annuitizing all unannuitized wealth at age 65. We relax these assumptions, allowing households to annuitize any part of their unannuitized wealth at any age and to return to the annuity market as many times as they wish. Using numerical optimization techniques, assuming the levels of actuarial unfairness of annuities calculated in previous research, and retaining the assumption made in previous research that one half of household wealth is pre-annuitized, we conclude that it is optimal for couples to delay annuitization until they are aged 73 82, and in some cases never to annuitize. It is usually optimal for single men and women to annuitize at substantially younger ages, between 65 and 70. Households that annuitize will generally wish to annuitize only part of their unannuitized wealth. Using data from the Asset and Health Dynamics Among the Oldest Old and Health and Retirement Study panels, we show that much of the failure of the average currently retired household to annuitize can be attributed to the exceptionally high proportions of the wealth of these cohorts that is pre-annuitized. We expect younger cohorts to have smaller proportions of pre-annuitized wealth and we project increasing demand for annuitization as successive cohorts age. %B Journal of Pension Economics and Finance %I 3 %V 3 %P 109-143 %G eng %N 2 %4 Annuities/Retirement Wealth %$ 13192 %R https://doi.org/10.1017/S1474747204001696 %0 Report %D 2004 %T How Do Pensions Affect Expected and Actual Retirement Ages %A Alicia H. Munnell %A Triest, Robert K. %A Natalia A. Jivan %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper uses the first six waves of the Health and Retirement Study to investigate the impact of pensions on expected retirement age, on the probability of being retired in each wave given employment in the previous wave, and on the probability of retiring earlier than planned. Pension coverage per se and the type of pension are important in each case. Pension wealth reduces the expected retirement age by 0.6 year, and the incentives in defined benefit plans lower the expected age by another 1.1 years. Pension wealth increases the probability of retiring in a given wave, and pension accruals reduce the probability. Other characteristics of defined benefit plans, as measured by the pension dummy, further raise the probability of being retired. Finally, with regard to the probability of retiring earlier than planned, a change in defined contribution wealth increases the probability, but pension coverage per se reduces it. That is, those with pensions tend to be more accurate planners than those without. %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/wp-content/uploads/2004/11/wp_2004-271.pdf %L wp_2004/munnellCRR2004-27 %4 Pension Wealth/Retirement Planning %$ 13752 %0 Report %D 2004 %T Increases in Wealth Among the Elderly in the Early 1990s: How Much is Due to Survey Design? %A Susann Rohwedder %A Steven Haider %A Michael D Hurd %K Methodology %K Net Worth and Assets %X The Asset and Health Dynamics Among the Oldest Old (AHEAD) study shows a large increase in reported total wealth between 1993 and 1995. Such an increase is not found in other US household surveys around that period. This paper examines one source of this difference. We find that in AHEAD 1993 ownership rates of stocks, CDs, bonds, and checking and saving accounts were underreported, resulting in under-measurement of wealth in 1993, and a substantial increase in wealth from 1993 to 1995. The explanation for the under-reporting is a combination of question sequence and wording in the AHEAD survey instrument. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge, MA %G eng %L wp_2004/NBER_w10862.pdf %4 Wealth/Survey Methods %$ 13772 %R 10.3386/w10862 %0 Report %D 2004 %T The Marginal Propensity to Spend on Adult Children %A Joseph G Altonji %A Villanueva, Ernesto %A Department of Economics %K Adult children %K Net Worth and Assets %X We examine how much of an extra dollar of parental lifetime resources will ultimately be passed on to adult children in the form of intervivos transfers and bequests. We infer bequests from the stock of wealth late in life. We use mortality rates and age specific estimates of the response of transfers and wealth to permanent income to compute the expected present discounted values of these responses to permanent income. Our estimates imply parents pass on between 2 and 3 cents out of an extra dollar of expected lifetime resources in bequests and about 1 cent in transfers. The estimates increase with parental income and are smaller for nonwhites. They imply that about 15 percent of the effect of parental income on lifetime resources of adult children is through transfers and bequests and about 85 percent is through the intergenerational correlation in earnings, although these estimates are sensitive to assumptions about the intergenerational earnings correlation, taxes, and the number of children. We compare our estimates to rough estimates of the marginal propensity to spend on children under 18 and higher education. %I New Haven, Connecticut, Yale University %G eng %L wp_2004/Altonji-Villanueva.pdf %4 Inter Vivos Transfers/Bequests/wealth %$ 14272 %0 Report %D 2004 %T Modeling Lifetime Earnings Paths: Hypothetical versus Actual Workers %A Olivia S. Mitchell %A John W R Phillips %A Au, Andrew %K Net Worth and Assets %K Pensions %K Social Security %X 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. %I University of Pennsylvania, Boettner Center for Pe, Pension Research Council WP 2004-3 %G eng %L wp_2004/Mitchell_etal_WP2004-3.pdf %4 Pensions/Retirement Wealth/Social Security %$ 13992 %0 Journal Article %J The Economic Journal %D 2004 %T Portfolio Risk and Self-Directed Retirement Saving Programmes %A James M. Poterba %K Net Worth and Assets %K Pensions %X Defined contribution retirement plans expose retirement savers to financial market risks. This paper explores the costs of retirement wealth risk. It begins by describing the holding of company stock in 401(k) plans in the US, an investment choice that yields a poorly diversified retirement portfolio. It then summarises the composition of household wealth at retirement and investigates how the degree of diversification in retirement assets affects expected utility. The cost of holding a poorly diversified retirement portfolio is very sensitive to whether or not the retirement saver has other assets that provide a floor for retirement consumption. %B The Economic Journal %I 114 %V 114 %P C26-C51 %G eng %N March %L wp_2004/PoterbaMarch04.pdf %4 Retirement Wealth/defined contribution pension plans %$ 12612 %0 Journal Article %J Research on Aging %D 2004 %T Relationship of Body Mass and Net Worth for Retirement-Aged Men and Women %A Stephanie J. Fonda %A Fultz, Nancy H. %A Kristi Rahrig Jenkins %A Wheeler, Laura M. %A Linda A. Wray %K Health Conditions and Status %K Net Worth and Assets %X This article examines linkages between body weight and socioeconomic status (SES) among Americans at or near retirement age. The authors hypothesize that (a) body weight relates negatively to SES, (b) this relationship is greater for women than men, and (c) the relationship attenuates when health, employment, and marital status are controlled.We use the 1992 Health and Retirement Study for this examination. SES is measured as net worth. Body weight is measured as body mass index and categorized as normal weight, overweight, and obese. Results indicate that, for women, overweight and obesity relate to lower logged networth. This relationship attenuates once covariates are considered. For men, overweight and obesity relate to higher logged net worth, even when covariates are considered. The findings suggest that greater weight has different meanings for men and women in this cohort; it might be related to success for men but a sociocultural detriment for women. %B Research on Aging %I 26 %V 26 %P 153-176 %G eng %N 1 %L pubs_2004_Fonda_etal.pdf %4 Body Mass Index/Net Worth %$ 11522 %R https://doi.org/10.1177/0164027503258739 %0 Journal Article %J Review of Financial Economics %D 2004 %T Relative Risk Aversion among the Elderly %A Bellante, Don %A Green, Carole A. %K Consumption and Savings %K Demographics %K Net Worth and Assets %K Risk Taking %X This paper examines portfolio allocation behavior of the elderly, investigating whether their behavior conforms to Arrow's postulate of increasing relative risk aversion. Additionally, the effects on risk aversion of age, race, gender, education, health status, and the number of children are examined. The source of data is the AHEAD data set that is comprised of households with at least one member aged 70 or over. In the preferred specification, evidence supports a finding of modestly decreasing relative risk aversion and statistical significance for the personal characteristics examined. Implications are drawn for the likely security markets effects of an aging population. %B Review of Financial Economics %I 13 %V 13 %P 269-81 %G eng %N 3 %4 Economics of the Elderly/Elderly/Assets/Portfolio Choice/Risk aversion %$ 14390 %R https://doi.org/10.1016/j.rfe.2003.09.010 %0 Thesis %D 2004 %T Retirement Transitions: The role of shocks to household resources %A Kim, Sora %K Health Conditions and Status %K Healthcare %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %X The role of shocks to household resources in affecting retirement transitions among older employees was analyzed using data from the Health and Retirement Study (HRS). The transitions of reverse retirement and partial retirement were of particular interest. The objectives of the study were: 1) To explore how shocks, or unexpected changes to financial and human resources, affect retirement transitions, and 2) To explore the relative importance of shocks in making retirement transitions. The study sample consisted of 2,514 HRS respondents, born between 1926 and 1938, who changed employment status between 1998 and 2000 or between 2000 and 2002. A multinomial Logit model was used in order to make comparisons among the four retirement transition groups. The empirical model included institutional variables and demographic and environmental control variables. The results suggest that just as the paths to retirement are diverse and complex, so are their determinants. Shocks to financial resources had the largest effects on reverse retirement transitions. Shocks to human resources, including family structure and health, affected all retirement transitions. Institutional variables had the largest marginal effects on partial retirement. As expected, positive shocks to assets decreased the odds of reverse retirement, and negative income shocks had larger marginal effects on retirement transitions than positive income shocks. However, positive asset shocks had larger marginal effects on retirement transitions than negative asset shocks. The partial retirement group was distinguished from the reverse retirement group in terms of financial shock impacts; for members of the partial retirement group, rather than shocks to resources, institutional supports were key determinants. Fewer significant effects on the odds of partial retirement over traditional retirement were found, and the effects were smaller than those for reverse retirement and retirement from part-time employment in terms of their magnitudes. The loss of human resources was important across the transition groups, with greater impact of shock to marital status on women's labor force transitions compared to men's. To reduce shocks to household resources under uncertainty, retirement education should encompass information on asset allocation and financial risk. These topics may help workers more effectively plan for retirement. %I The Ohio State University %C United States -- Ohio %8 2004 %G eng %U https://search.proquest.com/openview/f7f4076a33407410a70e40feb8aa40c4/1?pq-origsite=gscholar&cbl=18750&diss=y %4 Gerontology %$ 17660 %! Retirement Transitions: The role of shocks to household resources %0 Journal Article %J Journal of Finance %D 2004 %T Social Interaction and Stock Market Participation %A Hong, Harrison %A Kubik, Jeffrey D. %A Stein, Jeremy C. %K Health Conditions and Status %K Net Worth and Assets %X We propose that stock-market participation is influenced by social interaction. In our model, any given social investor finds the market more attractive when more of his peers participate. We test this theory using data from the Health and Retirement Study, and find that social households those who interact with their neighbors, or attend church are substantially more likely to invest in the market than non-social households, controlling for wealth, race, education, and risk tolerance. Moreover, consistent with a peer-effects story, the impact of sociability is stronger in states where stock-market participation rates are higher. %B Journal of Finance %I 59 %V 59 %P 137-163 %G eng %N 1 %4 Stock Market/Social Interaction %$ 6611 %R 10.3386/w8358 %0 Book Section %B Perspectives on the Economics of Aging %D 2004 %T The Transition to Personal Retirement Accounts and Increasing Retirement Wealth %A James M. Poterba %A Steven F Venti %A David A Wise %E David A Wise %K Net Worth and Assets %K Pensions %X Retirement saving has changed dramatically over the last two decades. There has been a shift from employer-managed defined benefit pensions to defined contribution retirement saving plans that are largely controlled by employees. In 1980, 92 percent of private retirement saving contributions were to employer-based plans and 64 percent of these contributions were to defined benefit plans. Today, about 85 percent of private contributions are to plans in which individuals decide how much to contribute to the plan, how to invest plan assets and how and when to withdraw money from the plan. In this paper we use both macro and micro data to describe the change in retirement assets and in retirement saving. We give particular attention to the possible substitution of pension assets in one plan for assets in another plan such as the substitution of 401(k) assets for defined benefit plan assets. Aggregate data show that between 1975 and 1999 assets to support retirement increased about five-fold relative to wage and salary income. This increase suggests large increases in the wealth of future retirees. The enormous increase in defined contribution plan assets dwarfed any potential displacement of defined benefit plan assets. In addition, in recent years the annual 'retirement plan contribution rate,' defined as retirement plan contributions as a percentage of NIPA personal income, has been over 5 percent. This is much higher than the NIPA total personal saving rate, which has been close to zero. Retirement saving as a share of personal income today would likely be at least one percentage point greater had it not been for legislation in the 1980s that limited employer contributions to defined benefit pension plans, and the reduction in defined benefit plan contributions associated with the rising stock market of the 1990s. It is also likely that the 'retirement plan contribution rate' would be much higher today if it were not for the 1986 retrenchment of the IRA program. Rising retirement plan contributions, as well as favorable rates of return on retirement plan assets in the 1990s, explain the large increase in these assets relative to income. Employee retirement saving under a defined contribution plan is easily measured and quite %B Perspectives on the Economics of Aging %I University of Chicago Press %C Chicago, IL %G eng %4 Retirement Wealth/defined contribution pension plans %$ 13362 %R 10.3386/w8610 %0 Report %D 2003 %T Annuities and Retirement Satisfaction %A Panis, Constantijn %K Expectations %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Social Security %X This paper analyzes pre-retirement expectations and post-retirement satisfaction, in particular their association with the degree to which retirees financial resources are in the form of annuities. Using the 1992-2000 Health and Retirement Study (HRS), we find that most retirees are very satisfied with their overall situation, but the degree of satisfaction varies substantially with retirees characteristics. In particular, people in better health and with more financial resources tend to be more satisfied. Holding constant the present value of retirement resources and other factors, we find that retirees who can finance more of their consumption in retirement from pension annuities (vs. Social Security benefits and accumulated savings) are more satisfied. Retirees with lifelong annuities also tend to maintain their level of satisfaction during retirement, whereas those without tend to become less satisfied over time. We find the very same patterns with alternative depression-related measures of well-being in retirement. The findings have important implications for the well-being of future American retirees, who are increasingly reliant on DC pension plans rather than traditional DB. %B RAND Unrestricted Draft %I RAND Corporation %C Santa Monica, CA %G eng %U https://www.rand.org/pubs/drafts/DRU3021.html %4 Retirement Expectations/Retirement Wealth/Satisfaction %$ 10472 %0 Report %D 2003 %T The Annuity Puzzle Gets Bigger %A Petrova, Petia %K Healthcare %K Net Worth and Assets %X Economic theory predicts that the gains from annuitization are substantial, but annuities are rare in practice. Who buys private annuities? Most of the literature concentrates on standard economic considerations, like preferences and prices, which fail to explain much of the variation in the propensity to annuitize. I add to this approach in two ways, first by exploring whether growing up in a rich family can make someone more patient and, therefore, more prone to annuitize. Second, I draw from recent literature in psychology on the problem of overconfidence , and argue that it could apply to someone s estimation of his or her life expectancy and hence to his or her propensity to annuitize. I find that appealing to these kinds of explanations does little to resolve the annuity puzzle. %I Center for Retirement Research at Boston College %G eng %4 Annuities/Psychology %$ 10532 %0 Report %D 2003 %T Bad Luck and Consumption Behavior %A Owen,Ann L. %A Stephen Wu %K Consumption and Savings %K Net Worth and Assets %I Hamilton College %C Clinton, NY %G eng %4 Consumption/Financial Management %$ 12132 %0 Journal Article %J Industrial Relations %D 2003 %T Cash Balance Plans and the Distribution of Pension Wealth %A Richard W. Johnson %A Cori E. Uccello %K Net Worth and Assets %K Pensions %X Recent pension plan coversions by numerous large employers have sparked debate about the merits of cash balance plans. This paper compares pension wealth in traditional defined benefit (DB) plans and cash balance plans for a national sample of coverred Americans aged 51 to 61. The simulations indicate that replacing DB plans with cash balance plans would redistribute pension wealth from those with long-term jobs to those with multiple short-term jobs and from those with substantial pension benefits to those with more limited benefits. Perhaps unexpectedly, women ad midlife in 1992 with DB coverage would lose wealth in cash balanace plans, but future cohorts of women are likely to fare better. %B Industrial Relations %I 42 %V 42 %P 745 %G eng %N 4 %4 Pension Plans/Retirement Wealth %$ 11672 %R https://doi.org/10.1111/1468-232X.00314 %0 Report %D 2003 %T The Economic Consequences of Marital Disruption for Pre-Retirement Age African-American, Hispanic and Non-Hispanic White Women %A Jacqueline L. Angel %A Cynthia J. Buckley %A Ronald J. Angel %A Maren A. Jimenez %K Adult children %K Net Worth and Assets %K Women and Minorities %I Population Association of America %C Minneapolis, MN %G eng %4 Marital Dissolution/Women/Economic Status %$ 12162 %0 Journal Article %J The Journal of Human Resources %D 2003 %T The Effects of Health Events on the Economic Status of Married Couples %A Stephen Wu %K Adult children %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper uses measures of exogenous health shocks to identify the different channels through which changes in health conditions affect income, wealth, and consumption behavior. The results indicate that serious health conditions have strong effects on household wealth, but that the effects for women are larger and more significant than the effects for men. The source of the asymmetry arises from the fact that general living expenses increase when wives become seriously ill, while for husbands, health shocks do not affect these expenditures. %B The Journal of Human Resources %I 38 %V 38 %P 219-230 %G eng %N 1 %4 Health/Retirement/Labor Force/Marriage/Economic Status %$ 6580 %0 Report %D 2003 %T Empirical Validation of HRS Pension Wealth Measures %A Susann Rohwedder %K Net Worth and Assets %X On average, pension wealth amounts to a major fraction of household wealth with considerable variance at the individual level. Empirical analysis of household behavior therefore ought to account for it, but often does not, because of lack of appropriate data. The Health and Retirement Study (HRS) allows computing two measures of pension wealth: one derived from the self-reports and one that uses information on pension plan rules obtained from employer-provided documents. This study assesses the reliability of these two pension wealth measures on the basis of their explanatory power in three examples of economic frameworks. The analysis demonstrates that in straightforward analysis both measures may be thought of as reasonably powerful covariates. Yet, taking into account implications from the way the measures are constructed leads to quite different conclusions which favor the self-reports in empirical analysis. %I RAND %G eng %L wp_2003/Rohwedder-Validation05.03.pdf %4 Pension Wealth %$ 11712 %0 Journal Article %J The Journals of Gerontology: Social Sciences %D 2003 %T An Examination of the Impact of Health on Wealth Depletion of the Elderly %A Jinkook Lee %A Hyungsoo Kim %K Demographics %K Healthcare %K Net Worth and Assets %X Objectives. This study investigates the effects of new health events and existing health conditions on wealth depletion in elderly individuals. Methods. A model deriving from life-cycle theory is proposed and estimated using Waves 1 and 2 of the Asset and Health Dynamics of the Oldest Old (AHEAD) data set. Results. Both new health events and existing health conditions significantly influence wealth depletion of elders, but their impacts differ across marital status. Whereas an occurrence of new health events brought wealth depletion of elders in married households, having existing chronic health conditions was associated with wealth depletion of elders in single households. Discussion. Poor health, both a new health event and existing chronic conditions, leads to considerable wealth depletion in elderly individuals. Considering the significant impacts of health on wealth, the public needs to be better informed of potential health events in later life and the associated financial burden. Additional health insurance plays an important role in preventing elders from financial hardship. %B The Journals of Gerontology: Social Sciences %I 58B %V 58B %P S120-126 %G eng %U http://psychsoc.gerontologyjournals.org/ %N 2 %L pubs_2003_Lee-KimJG.pdf %4 Wealth/Elderly/Health Care Costs %$ 11182 %0 Journal Article %J Financial Services Review %D 2003 %T Household Income, Asset Allocation, and the Retirement Decision %A Karen E. Lahey %A Kim, Doseong %A Newman, Melinada L. %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %B Financial Services Review %I 12 %V 12 %P 219-238 %G eng %4 Income/Assets/Retirement Planning %$ 13412 %0 Report %D 2003 %T The Impact of Financial Education on Savings and Asset Allocation %A Annamaria Lusardi %K Education %K Net Worth and Assets %X 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. %I Michigan Retirement Research Center, Michigan Retirement Research Center %G eng %U http://www.mrrc.isr.umich.edu/content.cfm?section=researchandcontent=research_detailandpid=UM03-06 %L wp_2003/Lusardi_wp061.pdf %4 Asset allocation/Education, Financial %$ 12122 %0 Journal Article %J Benefits Quarterly %D 2003 %T Investment Choice in Defined Contribution Plans: the Effects of Retirement Education on Asset Allocation %A Leslie A. Muller %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X The article presents a summary of the research titled "Investment Choice in Defined Contribution Plans: The Effects of Retirement Education on Asset Allocation." Pension plan sponsors and policy makers both have recently become concerned as to whether participants have the financial knowledge to choose how their pension assets are invested. The article provides evidence of the effect of retirement classes on asset allocation in self-directed defined contribution plans. %B Benefits Quarterly %I 19 %V 19 %G eng %U http://140.234.252.185/c/articles/9859056/investment-choice-defined-contribution-plans-effects-retirement-education-asset-allocation %N 2 %4 defined contribution pension plans/Asset allocation/Retirement Education %$ 13452 %0 Report %D 2003 %T Labor Supply Flexibility and Portfolio Choice: An Empirical Analysis %A Hugo Benítez-Silva %K Employment and Labor Force %K Net Worth and Assets %X This paper uses panel data from the Health and Retirement Study to estimate the relationship between measures of labor supply flexibility and portfolio-choice decisions by utility-maximizing individuals. Seminal research on portfolio decisions over the lifecycle, and recent research on stochastic dynamic programming models with endogenous labor supply and savings decisions suggest that, other things equal, individuals with more labor supply flexibility are likely to invest more in risky assets, regardless of their age, because of the insurance component that flexible labor supply provides. After controlling for panel sample selection and unobserved heterogeneity I find that labor supply flexibility leads to holding between 12% and 14% more wealth in stocks. %B Michigan Retirement Research Center Research Working Paper %I Michigan Retirement and Disability Research Center at University of Michigan %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/pubs/labor-supply-flexibility-and-portfolio-choice-an-empirical-analysis/ %4 Labor Supply/Portfolio Choice %$ 12032 %0 Report %D 2003 %T Labor Supply, Investments in Housing, and Portfolio Choice: An Empirical Analysis Using the HRS %A Hugo Benítez-Silva %K Employment and Labor Force %K Housing %K Net Worth and Assets %I Stony Brook, N.Y., SUNY-Stony Brook %G eng %4 Labor Supply/Home Ownership/Portfolio choice %$ 12002 %0 Report %D 2003 %T Lifetime Earnings Variability and Retirement Wealth %A Olivia S. Mitchell %A John W R Phillips %A Au, Andrew %A McCarthy, David %K Income %K Net Worth and Assets %X 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. %B Michigan Retirement Research Center Research Working Paper %I Michigan Retirement Research Center at the University of Michigan, %C Ann Arbor, MI %G eng %4 Income Variability/Retirement Wealth %$ 12182 %R https://dx.doi.org/10.2139/ssrn.1091441 %0 Report %D 2003 %T Measuring Pension Wealth in the HRS: Employer and Self-Reports %A Susann Rohwedder %K Methodology %K Net Worth and Assets %I RAND %G eng %L wp_2003/Rohwedder_PensionAssessment.pdf %4 Pension Wealth/Measurement %$ 11722 %0 Journal Article %J American Economic Review %D 2003 %T The Mismatch Between Life Insurance Holdings and Financial Vulnerabilities: Evidence from the Health and Retirement Study %A Bernheim, B. Douglas %A Forni, Lorenzo %A Gokhale, Jagadeesh %A Laurence J. Kotlikoff %K Insurance %K Net Worth and Assets %X This study examines life insurance holdings and financial vulnerabilities among couples approaching retirement age. Two separate concerns motivate our analysis. First, there are reasons to suspect that life insurance coverage may be poorly correlated with underlying financial vulnerabilities. A well-known insurance industry adage holds that life insurance is “sold and not bought.” Alternatively, households may purchase long-term policies relatively early in life, and subsequently fail to adjust coverage appropriately because of inertia and/or other psychological considerations. Second, households that purchase little or no life insurance may leave either or both spouses at risk of serious financial consequences %B American Economic Review %I 93 %V 93 %P 354-365 %G eng %N 1 %L pubs_2003_Bernheim_03.pdf %4 Life Insurance/Widowhood %$ 6610 %R 10.1257/000282803321455340 %0 Report %D 2003 %T Planning and Saving for Retirement %A Annamaria Lusardi %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %X There are vast differences in wealth holdings, even among households in similar age groups. In addition, a large percentage of U.S. households arrive close to retirement with little or no wealth. While many explanations can be found to rationalize these facts, approximately thirty percent of households whose head is close to retirement have done little or no planning for retirement. Planning is shaped by the experience of other individuals: individuals learn to plan for retirement from older siblings. They also learn from the experience of old parents. In particular, unpleasant events, such as financial difficulties and health shocks at the end of life, provide incentives toward planning. In addition, planning affects wealth levels as well as portfolio choice. Individuals who plan are more likely to hold large amounts of wealth and to invest their wealth holdings in high return assets, such as stocks. Thus, planning plays an important role in explaining the saving behavior of many households. %I Dartmouth College, Dept. of Economics %G eng %U https://www.dartmouth.edu/~alusardi/Papers/Lusardi_pdf.pdf %L wp_2003/Lusardi_planning.pdf %4 Planning Techniques/Retirement Planning/Portfolio Choice %$ 12622 %0 Report %D 2003 %T Portfolio Choice and Health Status %A Rosen, Harvey S. %A Stephen Wu %K Health Conditions and Status %K Net Worth and Assets %X This paper analyzes the role that health status plays in household portfolio decisions using data from the Health and Retirement Study. The results indicate that health is a significant predictor of both the probability of owning different types of financial assets and the share of financial wealth held in each asset category. Households in poor health are less likely to hold risky financial assets, other things (including the level of total wealth) being the same. Poor health is associated with a smaller share of financial wealth held in risky assets and a larger share in safe assets. We find no evidence that the relationship between health status and portfolio allocation is driven by 'third variables' that simultaneously affect health and financial decisions. Further, the relationship between health status and portfolio choice does not appear to operate through the effect of poor health on individuals' attitudes toward risk, their planning horizons, or their health insurance status. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge, MA %G eng %U http://papers.ssrn.com/paper.taf?abstract_id=375305 %L wp_2003/Rosen-Wu.pdf %4 Health Status/Stock Market/Assets/Wealth %$ 10102 %0 Report %D 2003 %T Private Pensions: Participants Need Information on Risks They Face in Managing Pension Assets at and during Retirement %A United States General Accounting Office %K Consumption and Savings %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X Question: Individuals face increasing responsibility for ensuring the sufficiency of their retirement savings, a result of the continuing trend toward pension plans with individual accounts and longer life expectancies. Finding: Using the NIA-funded Health and Retirement Study, GAO found that while plan sponsors provide timely information about payout options (e.g., lump-sum versus annuity) and that many plans offer both lump-sum and annuity options, there is little discussion regarding the relative risks of the available options, as well as the risk of outliving one s savings. While many retirees received annuities (60 percent), a large proportion that had the option of annuitizing chose instead to receive a lump-sum distribution. Recommendation: More effort is needed to increase public awareness of the risks associated with various options for pension distributions and the implications of choosing one option versus another for the likelihood of outliving one s retirement savings. %I Washington, DC, U.S. General Accounting Office %G eng %U https://www.gao.gov/products/GAO-03-810 %4 retirement Saving/Lump sum distributions/Annuities/retirement planning %$ 62550 %0 Journal Article %J Research in Labor Economics %D 2003 %T Racial and Ethnic Differences in Pension Wealth %A Even, William %A David A. Macpherson %K Demographics %K Net Worth and Assets %X It is well established that Black and Hispanic workers accumulate leszs wealth for retirement than white workers. This study provides evidence on whether racial and ethnic differences in private pension coverage and benefit levels contribute to the wealth differentials. Using data from the Current Population Survey, Survey of Consumer Finances and the Health and Retirement Survey, several consistent findings emerge. First, most of the racial and ethnic differences in pension benefit levels are accounted for by differences in worker charateristics. Second, among workers who are covered by a private pension, racial and ethnic differences in pension asset accumulation are quite small. Finally, exclusion of pension wealth has a small effect on the comparison of average levels of wealth across racial and ethnic groups, but has a substantial effect for comparisons at the bottom of the wealth distribution. Overall, the findings suggest that, holding worker characteristics constant, minority and majority workers accumulate very similar levels of wealth. %B Research in Labor Economics %I 22 %V 22 %P 205-227 %@ 78-0-76231-026-5 %G eng %4 Racial Differences/Pension Wealth %$ 13222 %R https://doi.org/10.1016/S0147-9121(03)22006-9 %0 Report %D 2003 %T Retirement Wealth and Lifetime Earnings Variability %A Olivia S. Mitchell %A John W R Phillips %A Au, Andrew %A McCarthy, David %K Net Worth and Assets %K Social Security %X 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. %B Pension Research Council Publications %I University of Pennsylvania, Wharton School %C Philadelphia %G eng %U https://pensionresearchcouncil.wharton.upenn.edu/publications/papers-2018/retirement-wealth-and-lifetime-earnings-variability/ %L wp_2003/Mitchell_etal.pdf %4 Retirement Wealth/Earnings and Benefits File %$ 11582 %0 Journal Article %J Journal of Economic Literature %D 2003 %T Review of: Assets for the poor: The benefits of spreading asset ownership %A Menchik, Paul L. %K Income %K Net Worth and Assets %K Public Policy %B Journal of Economic Literature %I 41 %V 41 %P 908-10 %G eng %N 3 %4 Distribution/Public Policy/Wealth/Income/Welfare %$ 14970 %0 Report %D 2003 %T The Role of Marital History, Early Retirement Benefits, and the Economic Status of Women %A Tay K. McNamara %A Regina O'Grady-LeShane %A Williamson, John B. %K Adult children %K Net Worth and Assets %K Women and Minorities %X This article compares the relative economic status of women who take and postpone taking early Social Security benefits, with particular attention to the role of marital history. Marital history categories discussed include: lifelong marriages, marriages in which the woman had been previously divorced or widowed, divorced, widowed, and never married. The results presented here should be useful in evaluating the potential consequences of increasing the Earliest Entitlement Age (EEA). While increasing the EEA would not cause economic hardship for many, it may have adverse effects on divorced and widowed women who generally are at greater risk of poverty than married women. The economic effects of prior divorce or widowhood are reflected in the lower financial resources of women who remarry. ( 2003, by Tay K. McNamara, Regina O Grady-LeShane, and John B. Williamson.) %B Center for Retirement Research at Boston College Working Papers %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/the-role-of-marital-history-early-retirement-benefits-and-the-economic-status-of-women/ %L wp_2003/CRRwp_2003-01.pdf %4 Economic Status/Women/Marital History %$ 10062 %0 Thesis %D 2003 %T Saving, Wealth and Retirement: Evidence from the Health and Retirement Study %A Khitatrakun, Surachai %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This dissertation examines household saving and retirement decisions using data from the 1992 to 2000 Health and Retirement Study (HRS). After a brief introduction, the second chapter examines the relationship between children and household net worth around the time of retirement. Restricting the sample to first-time married couples and controlling for many factors including lifetime earnings and unearned income, I find that households with more children generally have less net worth than households with fewer, but the difference is small. Moreover, there is no strong evidence that the difference is a result of the adverse effect of college financial aid rules on savings. In addition, there is little evidence that children affect parents' subjective assessments of retirement security. These findings are consistent with the basic principle of the life-cycle framework where parents plan optimally for their retirement consumption. The third chapter examines how wealth changes affect retirement decisions. I focus on the differences between self-reported expected retirement dates in one survey and either the actual or expected retirement dates in the next survey for the same individuals, and relate these to changes in household net worth. Moreover, I recognize that institutional constraints could deter individuals from adjusting their retirement dates to accommodate unanticipated events, such as wealth shocks. I find that the relationship between wealth changes and retirement is generally significant in the expected direction, and more pronounced for the respondents unlikely to face binding institutional constraints. The fourth chapter examines whether Americans are preparing adequately for retirement. My coauthors and I construct a life-cycle model that incorporates detailed HRS data on family structure and age of retirement and allows for uncertainties in earnings, social security benefits, and defined benefit pension receipts. Then, we solve every household's life-cycle problem and, using data on the household's entire history of earnings realizations, derive optimal wealth at given ages. The model explains over 70 percent of the variation in wealth for married households, and over 80 percent for never-married single households. Comparing the derived optimal wealth targets with the observed amount of net worth, we find little evidence that HRS households have under-saved. %I The University of Wisconsin - Madison %8 2003 %G eng %4 Retirement Behavior %$ 12722 %! Saving, Wealth and Retirement: Evidence from the Health and Retirement Study %0 Book Section %B Handbook of the Life Course %D 2003 %T Socioeconomic Status and Health over the Life Course: Capital as a Unifying Concept %A Frytak, Jennifer R. %A Harley, Carolyn R. %A Finch, Michael D. %E Mortimer, Jeylan T %E Shanahan, Michael J. %K Demographics %K Event History/Life Cycle %K Health Conditions and Status %K Net Worth and Assets %X On average, individuals of lower socioeconomic status (SES)—based on education, income, or occupation—have worse health than their higher SES counterparts (Adler, Boyce, Chesney, Folkman, & Syme, 1993; Antonovsky, 1967; Feinstein, 1993; Feldman, Makuc, Kleinman, & Cornoni-Huntley, 1989; House, Kessler, & Herzog, 1990; Kitagawa & Hauser, 1973; Marmot, Shipley, & Rose, 1984; Pappas, Queen, Hadden, & Fisher, 1993; Preston & Taubman, 1994; Townsend & Davidson, 1982). This relationship is best depicted as a gradient in health with a fairly linear trend in better health associated with increasing levels of SES, rather than a threshold effect. Furthermore, this relationship is stratified by age; lower SES individuals begin to experience health problems shortly after adolescence, while higher SES individuals experience little health decline until around retirement age (House et al, 1990, 1994). This life course patterning of SES and health is intriguing since it suggests substantial variation in the ability of each group to sustain good health over the life course. %B Handbook of the Life Course %S Handbooks of Sociology and Social Research %I Kluwer Academic/Plenum Publishers %C New York %P 623-643 %G eng %4 Life Cycle/Socioeconomic Status/Human Capital/Health %$ 14312 %R 10.1007/978-0-306-48247-2_28 %0 Report %D 2003 %T Wealth Effects and the Consumption of Leisure: Retirement Decisions During the Stock Market Boom of the 1990s %A Coronado, Julia L. %A Maria Perozek %K Net Worth and Assets %K Retirement Planning and Satisfaction %X It is well accepted that households increase consumption of goods and services in response to an unexpected increase in wealth. Consensus estimates of this wealth effect are in the range of 3 to 5 cents of additional consumption spending in the long run for each additional dollar of wealth. Economic theory also suggests that consumption of leisure, like consumption of goods and services, should increase with positive shocks to wealth. In this paper, we ask whether the run-up in equity prices during the 1990s led older workers to retire earlier than they had previously planned. We identify the effect by exploiting unique data on retirement expectations from the Health and Retirement Survey. Our econometric results suggest that respondents who held corporate equity immediately prior to the bull market of the 1990s retired, on average, 7 months earlier than other respondents. %B FEDS Working Papers %I Federal Reserve Board, Finance and Economics Discussion Series %G eng %U http://www.federalreserve.gov/pubs/feds/2003/200320/200320abs.html %L wp_2003/Coronado-Perozek.pdf %4 Wealth/Stock Market/Early Retirement %$ 10952 %0 Journal Article %J Social Science Quarterly %D 2003 %T Wealth, Race, and Mortality %A S.A. Bond %A Patrick M. Krueger %A Rebecca G Rogers %A Robert A Hummer %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X Objective. We explore, first, whether wealth relates to mortality risk independent of income and education, and second, whether wealth closes the black-white gap in U.S. adult mortality while controlling for other socioeconomic and sociodemographic factors. Methods. We employ the Cox proportional hazards models on data from the 1992 wave of the Health and Retirement Study linked to deaths through 1998, to analyze pre-retirement adult mortality in the United States. Results. The findings suggest that broader measures of SES, including wealth, are significant for understanding adult mortality. Further, vastly lower asset holdings among blacks, compared to whites, not only affects their financial wellbeing but also their survival prospects. Conclusions. Research and social policies that aim to understand and close health disparities in the United States may be poorly conceived if they ignore the impact of wealth on premature adult mortality. %B Social Science Quarterly %I 84 %V 84 %P 667-684 %G eng %N 3 %L pubs_2003_Bond_03.pdf %4 Racial Differences/Socioeconomic Status/Mortality/Wealth %$ 11942 %R https://doi.org/10.1111/1540-6237.8403011 %0 Report %D 2003 %T Widowhood, Divorce and Loss of Health Insurance Among Near-Elderly Women: Evidence from the Health and Retirement Study %A David R Weir %A Robert J. Willis %K Adult children %K Demographics %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Women and Minorities %X We have found modest effects of widowhood events on loss of health insurance. There are also modest effects of widowhood on labor supply, which we have not as yet attempted to attribute to insurance demand. Even new widowhood events, however, are not random with respect to initial conditions. Both initial health insurance status and risk of future widowhood are related to basic characteristics observed when married at baseline. When these confounding variables are controlled for in models of the effect of widowhood events on uninsurance, there is no longer statistical evidence of an independent effect of husband's death on risk of losing insurance. Part of the reason why the measured independent effect of widowhood appears small is that there are events within marriage that can also affect insurance coverage, such as retirement or health events. Even though the number of uninsured women whose lack of coverage can be attributed to widowhood is therefore small, and not a distinct major policy motive for changes in age of eligibility for Medicare, uninsurance rates overall among the near elderly, and the potential public burden of cost-shifting from years just before 65 to years just after gaining Medicare coverage, suggest that Medicare eligibility policies should be a focus of continued research. %B Michigan Retirement Research Center Research Paper %I Michigan Retirement Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1090894 %4 Widowhood/Divorce/Health Insurance Coverage/Middle Aged Adults/Women %$ 6657 %0 Report %D 2002 %T Aggregate Risk-Taking and Declining Mortality %A Ryan D. Edwards %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %X Just as health and wealth are related, so too are health and financial risk-taking. Although directions of causality are unclear, healthier people are wealthier and take more financial risks. Dierential mortality is therefore a source of bias in cross-sectional measures of portfolio choice through age. As declines in mortality increase lifespans, poorer and previously sicker individuals will increase their share of the surviving population. It follows that the aggregate equity share in the economy may be pulled lower, all other things equal. Panel data from the Health and Retirement Study confirm these insights. Mortality-adjusted age proles of portfolio shares rose less quickly during the 1990s than their unadjusted cross-sectional counterparts. One implication of a declining aggregate equity share due to aging is that public pension programs may need to be recongured over time in order to address the changing characteristics of surviving pensioners. Phasing in a partial privatization of Social Security would be one such option. %I University of California at Berkeley, Dept. of Economics %G eng %4 financial risk taking/Wealth/Health %$ 10842 %0 Book %D 2002 %T Annual Review of Gerontology and Geriatrics: Economic Outcomes in Later Life %A Crystal, Stephen %A Dennis G. Shea %K Healthcare %K Net Worth and Assets %X Leading scholars focus on the economics of aging, with a particular emphasis on the economic future of the baby boom generation. Key themes include the influence of early advantages on later-life economic outcomes (the cumulative advantage/cumulative disadvantage hypothesis); the relationship between inequalities in economic status and inequalities in health status and access to health care; and the consequences of societal choices concerning retirement income systems and policies for financing acute and long-term health care. %I Springer Publishing Co., Inc. %C New York %V 22 %G eng %4 Economic Status/Geriatrics %$ 9892 %0 Report %D 2002 %T Children and Retirement Wealth %A Khitatrakun, Surachai %K Adult children %K Net Worth and Assets %I University of Wisconsin-Madison, Economics Department %G eng %4 Wealth Accumulation/Children %$ 10752 %0 Report %D 2002 %T Choice and Other Determinants of Employee Contributions to Defined Contribution Plans %A Papke, Leslie E. %K Net Worth and Assets %K Pensions %I Center for Retirement Research at Boston College %G eng %U http://www.bc.edu/centers/crr/papers/Fourth/cp_02_13_papke2.pdf %4 defined contribution pension plans/plan characteristics/asset choice %$ 10962 %0 Report %D 2002 %T Crediting Care? Gender, Race, Class and Social Security Reform %A Herd, Pamela %K Demographics %K Methodology %K Net Worth and Assets %I Syracuse University %G eng %4 Social Security Research/Gender/Economic Status %$ 6624 %0 Journal Article %J Journal of Marriage and Family %D 2002 %T Does Marital History Matter? Marital Status and Wealth Outcomes Among Preretirement Adults %A Janet M Wilmoth %A Koso, G. %K Adult children %K Demographics %K Event History/Life Cycle %K Net Worth and Assets %B Journal of Marriage and Family %I 64 %V 64 %P 254-268 %G eng %N 1 %L pubs_2002_Wilmonth_JJMandF.pdf %4 Marital Status/Wealth/Sex Differences/Life Cycle/Life Events/Adults/Marriage/the family and socialization/sociology of the family, marriage and divorce %$ 8536 %R https://doi.org/10.1111/j.1741-3737.2002.00254.x %0 Report %D 2002 %T The Economic Consequences of Being Uninsured %A Helen G Levy %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %X I estimate the impact of being diagnosed with a serious new health condition (cancer, diabetes, heart attack, chronic lung disease, or stroke) on household wealth, food consumption and total household income for households with and without health insurance at baseline, using data from the first four waves of the Health and Retirement Study. I find that health shocks do not have a significant effect on consumption; households are able to smooth the impact of these shocks. Whether they deplete wealth in order to do so is not entirely clear; the estimated effect of a health shock on wealth is large (about $28,000) for both insured and uninsured households, but is not statistically significant. The proportional effect on wealth is estimated to be larger for uninsured households (a drop of 20 percent) than for insured households (a drop of about 2 percent), but again, neither effect is significantly different from zero. Health shocks reduce household income by about $9,000 and reduce the probability of work by about ten percentage points; the labor supply response to a shock is about the same whether or not a household has insurance. There is no evidence that the uninsured face significantly higher economic risks than the insured in the event of a health shock. %B Economic Reserach Initiative on the Uninsured Working Paper Series %I University of Chicago %G eng %U http://rwjf-eriu.org/pdf/wp12.pdf %L wp_2002/Levy-5july02.pdf %4 Economic Status/Health Insurance Coverage %$ 6626 %0 Report %D 2002 %T Education and Investment Behavior in the Family: A Study of Health Human Capital in Middle Age %A Ippolito, Richard A. %K Demographics %K Net Worth and Assets %I George Mason University School of Law %G eng %L wp_2002/Ippolito_Educ.pdf %4 Education/Human Capital %$ 6637 %0 Report %D 2002 %T Ensuring Time-Series Consistency in Estimates of Income from Wealth %A Juster, F. Thomas %A Joseph P. Lupton %A Cao, Honggao %K Income %K Methodology %K Net Worth and Assets %I Ann Arbor, MI, The University of Michigan, Michigan Retirement Research Center %G eng %L wp_2002/Juster-Lupton-Cao.pdf %4 Longitudinal Design/Income/Wealth %$ 6643 %0 Report %D 2002 %T Health Insurance and Labor Supply: Evidence from Hypothetical Shocks to Wealth %A Matthew D. Shapiro %A Miles S Kimball %K Employment and Labor Force %K Health Conditions and Status %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %I Ann Arbor, MI, University of Michigan %G eng %4 Health Insurance/Health Shocks/Labor Supply/Wealth %$ 6658 %0 Report %D 2002 %T How Important Are Private Pensions? %A Alicia H. Munnell %A Sundén, Annika %A Lidstone, Elizabeth %K Employment and Labor Force %K Income %K Net Worth and Assets %K Pensions %X Employer-provided pensions play an important role in assuring a comfortable retirement. In 1992, they accounted for about 20 percent of the total wealth of middle-income households aged 51-61, second only to Social Security. However, many workers still lack pension coverage. After increasing sharply in the post-World War II period, the percentage of the private sector workforce covered by an employer-sponsored pension plan at any given point in time has remained around 50 percent since the 1970s. This constancy obscures two major changes, however. First, pension coverage has increased for women and declined for men, primarily reflecting the increased earnings and labor force participation of women and a decline for men in union membership and employment in large manufacturing firms. Second, a major shift has occurred in the types of plans from defined benefit to defined contribution. Defined benefit plans generally provide retired workers with a set amount based on their salary history, while benefits under defined contribution plans depend on the accumulated amount in a worker’s account. The shift to defined contribution plans reflects employment trends as well as conversion of plans… %B Center for Retirement Research at Boston College Briefs %I Center for Retirement Research at Boston College %C Boston %G eng %U https://crr.bc.edu/briefs/how-important-are-private-pensions/ %L wp_2002/munnell.pdf %4 Private Pensions/Retirement Incomes/Economic Status/Labor %$ 8554 %0 Report %D 2002 %T Liquidity Constraints, Wealth Accumulation and Entrepreneurship %A Hurst, Erik %A Annamaria Lusardi %K Employment and Labor Force %K Net Worth and Assets %X There exist many government programs in the U.S. aimed to foster entrepreneurship and, in particular, to relax credit restrictions new entrepreneurs may face. However, many leading empirical works have found that there exists a positive correlation between wealth and starting a business and argued that binding liquidity constraints prevent many household from becoming business owners. In this paper, we examine closely the relationship between weath accumulation and entrepreneurship. We argue that, if liquidity constraints are binding, the incremental effect of a dollar of wealth on the probability to start a business should decrease as welath increases. Using data from several surveys, we can reject the hypothesis that liquidity constraints are the cause of the observed wealth-business start-up correlation. We find that only a small group of extremely wealthy households (top 3 of the wealth distribution) drives the correlation between wealth and becoming a business owner. Additionally, we find that there is no correlation between initial wealth (and wealth changes) and the propensity to become a business owner among businesses that require high starting capital and among groups that are ex-ante more likely to be liquidity constrained, such as young, black, or female households. Furthermore, when using a more appropriate measure of liquidity and accessibility of funds, such as receiving insurance settlements or capital gains on home equity, we find that the positive correlation between wealth and starting a business vanishes. Finally, we examine the importance of family wealth in affecting the child's propensity to start a business as well as business survival. We again show that it is mainly those families at the very top of the wealth distribution that are responsible for driving the positive relationship between wealth and business start-up and wealth and business survival. Taken together, our evidence casts severe doubts that the mechanism at play in explaining the positive relationship between wealth and business start-up had much to do with the existence of liquidity constraints. %I Chicago Business School %G eng %4 Wealth/Capital/Business start-up %$ 9992 %R 10.1086/381478 %0 Report %D 2002 %T Modeling Income in the Near Term: Revised Projections of Retirement Income Through 2020 for the 1931-1960 Birth Cohorts %A Toder, Eric %A Thompson, Lawrence H. %A Melissa Favreault %A Richard W. Johnson %A Perese, Kevin %A Ratcliffe, Caroline %A Karen E. Smith %A Cori E. Uccello %A Timothy A Waidmann %A Berk, Jillian %A Woldemariam, Romina %A Gary T. Burtless %A Claudia R Sahm %A Douglas A. Wolf %K Disabilities %K Net Worth and Assets %K Pensions %K Social Security %X The Division of Policy Evaluation (DPE) of the Social Security Administration (SSA) has entered into two contracts with the Urban Institute to help it develop a new tool for analyzing the distributional consequences of Social Security reform proposals. The first, awarded in 1998, led to the development of Modeling Income in the Near Term (MINT), a tool for simulating the retirement incomes of members of the Baby Boom and neighboring cohorts. The second, awarded in 2000, was to expand and improve on the first version of MINT. In all phases of the project, members of the research staff at SSA/DPE collaborated closely with the contractors. The Brookings Institution served as a subcontractor to the Urban Institute under both contracts and the RAND Corporation participated in the development of the initial version of MINT under a separate contract. This report describes the work of the researchers at Urban and Brookings under the second contract. %B Urban Institute Research Report %I The Urban Institute %C Washington, D.C. %G eng %U http://www.urban.org/UploadedPDF/410609_ModelingIncome.pdf %L wp_2002/Toder_etal_ModelingIncome.pdf %4 Earnings and Benefits File/Disability/Disability/Pensions/Wealth %$ 14212 %0 Journal Article %J National Tax Journal %D 2002 %T Pre-Retirement Lump-Sum Pension Distributions and Retirement Income Security: Evidence from the Health and Retirement Study %A Gary V. Engelhardt %K Methodology %K Net Worth and Assets %K Pensions %X This paper uses the Health and Retirement Study to examine the extent of retirement wealth erosion from pre-retirement lump-sum pension distributions. There is little evidence that spent distributions have resulted in significant pension leakage. If spent distributions had been rolled over into a tax-qualified plan, they would have represented 5-11 percent of pension and Social Security wealth for the median household that spent a distribution. However, one-quarter of the households that spent distributions--which is 2.25 percent of all households age 51 to 61--could have increased retirement wealth by 25 percent or more had the distributions been rolled over. %B National Tax Journal %I 55 %V 55 %P 665- %G eng %U https://www.jstor.org/stable/41789634 %N 4 %L pubs_2002_Engelhardt_GNatTaxJour.pdf %4 Retirement Wealth/Pensions/Models, Theoretical %$ 6596 %0 Report %D 2002 %T Retirement and the Stock Market Bubble %A Alan L Gustman %A Thomas L. Steinmeier %K Consumption and Savings %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper specifies and estimates a structural dynamic stochastic model of the way individuals make retirement and saving choices in an uncertain world, and applies that model to analyze the effects of the stock market bubble on retirement behavior. The model includes individual variation both in retirement preferences and in time preferences. Estimates are based on information covering the period 1992 through 2000 from the Health and Retirement Study (HRS), a panel survey of retirement age respondents and their spouses. The extraordinary returns in the stock market in the late 1990's, which more than doubled stock prices and unexpectedly increased the value of a mixed portfolio by nearly 60 percent, increased retirement for the HRS sample of workers by over 3 percentage points by the turn of the century and would have decreased the average retirement age by about a quarter of a year if it had not been interrupted. The subsequent decline in the market, which very nearly wiped out the gains that had been made during the preceding surge, effectively neutralized the effect of the preceding stock market gains on retirement. The effects of the bubble were to increase retirement as long as the bubble continued, but any continuing effects of the bubble after its end will probably be minimal. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge, MA %G eng %4 Retirement Behavior/Retirement Saving/Stock Market %$ 10222 %0 Journal Article %J Sociological Inquiry %D 2002 %T Self-defined Retirement Status and Engagement in Paid Work Among Older Working-age Women: Comparison Between Childless Women and Mothers %A Namkee G Choi %K Adult children %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Women and Minorities %X From changes in retirement laws and incentives many people, including working women, can decide when to retire based on their own preferences and needs. Family structure and familial roles are a major issue of when people will decide to retire, especially if considering women. Differences between women without children and those with children that are no longer living at home, and the likelihood of retirement among people of the two groups, is assessed. The author, also considers those women that take part in bridge jobs as a path to retirement. Detailed demographic findings comparing and contrasting those women with children living at home, those women with children not living at home, and those women who are childless, are given. Analyses of the data showed that women with children living at home were the least likely to claim retirement. Over the 2 years of data studied none of the three groups showed a change in their work status. The author feels that retirement is becoming a symbol of status, rather than a symbol that one has served in the workforce for many years and is now withdrawn %B Sociological Inquiry %I 72 %V 72 %P 43-71 %G eng %N 1 %4 Labor Force/Economic Status/Women/Family/Retirement Planning %$ 8560 %R 10.1111/1475-682X.00005 %0 Report %D 2002 %T The Size and Composition of Wealth Holdings in the United States, Italy, and the Netherlands %A Arie Kapteyn %A Panis, Constantijn %K Methodology %K Net Worth and Assets %X This report analyzes retirement-saving behavior and portfolio choice in the United States, Italy, and the Netherlands. The authors test hypotheses on the implications of institutional differences for wealth accumulation and portfolio composition. %B RAND Unrestricted Draft %I RAND Corp. %C Santa Monica, CA %G eng %U https://www.rand.org/pubs/drafts/DRU3002.html %4 Wealth/Cross Cultural Comparison %$ 6621 %0 Thesis %D 2002 %T Transmitting inequality: An asset-based analysis of racial and ethnic inequality and its intergenerational transmission %A Elmelech, Yuval %K Adult children %K Demographics %K Net Worth and Assets %K Public Policy %X This dissertation explores the determinants and socioeconomic consequences of inequality in material assets among middle-aged American households. Using survey data from the Health and Retirement study (HRS), and utilizing suitable quantitative techniques, this study establishes a conceptual ground which brings back the critical role private property and kinship relations play in contemporary stratification processes. This study shows that in the contemporary post-transitional, multi-asset society, two social mechanisms of closure and exclusion--marriage and inheritance--intervene in the connection between position in the labor market and position in the commodity market. Because the structure and the socioeconomic function of the family vary across racial/ethnic lines, I argue that the framework developed in this study is especially useful to the understanding of racial and ethnic inequality and its perpetuation across generations. %I Columbia University %8 2002 %G eng %U https://proxy.lib.umich.edu/login?url=https://search-proquest-com.proxy.lib.umich.edu/docview/60438081?accountid=14667 %4 Sociology, Individual and Family Studies (0628) %$ 5005 %+ ISBN 0-493-50617-9 %! Transmitting inequality: An asset-based analysis of racial and ethnic inequality and its intergenerational transmission %0 Report %D 2002 %T Wealth and the Timing of Retirement %A Khitatrakun, Surachai %K Net Worth and Assets %K Retirement Planning and Satisfaction %I University of Wisconsin-Madison, Economics Department %G eng %4 Wealth/Retirement Behavior %$ 10742 %0 Thesis %D 2002 %T Wealth Shocks and Retirement Timing and Other Essays %A Purvi Sevak %K Demographics %K Net Worth and Assets %K Public Policy %K Retirement Planning and Satisfaction %X This dissertation contains essays on two groups of individuals whose economic well being and behavior have received considerable attention in recent years: retirees and single mothers at risk of welfare receipt. Chapter 1 “Wealth Shocks and Retirement Timing: Evidence from the Nineties,” uses the 1992 to 1998 waves of the Health and Retirement Study (HRS) to find that exogenous increases in wealth lead to earlier retirement. Panel data on wealth and saving are used to estimate an elasticity of retirement flows between 1996 and 1998 with respect to wealth of 0.39 and 0.50 for men. Difference-in-differences regressions of retirement rates of individuals whose pension wealth depends on the stock market—individuals with defined contribution (DC) plans, to those whose pension wealth is not directly affected by the market—individuals with defined benefit (DB) pension plans, are also estimated. Consistent with wealth effects, significant increases in retirement rates are found among workers with DC plans. Chapter 2, “Local Fiscal Policy And Retiree Migration,” uses the 1992 to 2000 waves of HRS and town-level fiscal data from the Census of Governments, to examine whether moves by households near retirement age are motivated by local fiscal policy. The data show some evidence that movers lower their fiscal burden. Households that move across states the first time after their children have reached adulthood reduce their property tax liability by an average of $115. However, there is a great deal of heterogeneity across different types of movers. It is clear that while fiscal policy may factor into the move decision, it is just one of many variables upon which location choice by retirees is based. Chapter 3, “AFDC, SSI, And Welfare Reform Aggressiveness: Caseload Reductions Vs. Caseload Shifting,” uses pooled cross-sectional data from the 1986 to 1996 Current Population Survey (CPS) to examine whether reforms to the AFDC program that have made receipt of cash benefits more difficult for single mothers affected caseloads of the SSI program. Variation in state welfare reform over time shows that female-headed households in states pursuing welfare reform were 21.6 percent more likely to receive SSI. %I University of Michigan %8 2002 %G eng %U https://proxy.lib.umich.edu/login?url=https://search-proquest-com.proxy.lib.umich.edu/docview/56131715?accountid=14667 %4 Wealth (D914100) %$ 15330 %+ 0-493-88656-7 %! Wealth Shocks and Retirement Timing and Other Essays %0 Report %D 2002 %T Wealth Shocks and Retirement Timing: Evidence from the Nineties %A Purvi Sevak %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper explores whether the timing of retirement responds to unexpected changes in wealth. The period of the 1990s allows a unique examination of this question because of the large and unexpected capital gains realized by many households. Using the 1992 through 1998 waves of the Health and Retirement Study, and two different identification strategies, I find evidence consistent with the theoretical expectations of wealth effects for men. Using panel data on savings and wealth I estimate the elasticity of observed retirement flows between 1996 and 1998 with respect to wealth is between 0.39 and 0.50 for men. %B Michigan Retirement Research Center Research Working Paper %I University of Michigan %C Ann Arbor, MI %G eng %U https://deepblue.lib.umich.edu/bitstream/handle/2027.42/50593/wp027.pdf?sequence=1&isAllowed=y %L wp_2003/Sevak_weatlh.pdf %4 Capital/Wealth Accumulation/Retirement %$ 15370 %0 Report %D 2002 %T Who Becomes a Stockholder? Expectations, Subjective Uncertainty, and Asset Allocation %A Kezdi, Gabor %A Robert J. Willis %K Net Worth and Assets %B MRDRC Publications %I Michigan Retirement and Disability Research Center, University of Michigan %C Ann Arbor, MI %G eng %U https://mrdrc.isr.umich.edu/pubs/who-becomes-a-stockholder-expectations-subjective-uncertainty-and-asset-allocation/ %L wp_2002/Kezdi-Willis_NBER.pdf %4 Assets/Stock Market %$ 6656 %0 Book Section %B Assets for the Poor: The Benefits of Spreading Asset Ownership %D 2001 %T Access to wealth among older workers in the 1990s and how it is distributed: Data from the Health and Retirement Study %A R.V. Burkhauser %A Robert R. Weathers II %E Shapiro, Thomas M. %E Wolfe, Edward N. %K Demographics %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Older American laborers' access to financial assets is investigated. Data from the Health and Retirement Study are analyzed to determine whether older workers had access to wealth and how financial assets were distributed among older working Americans. Three categories of wealth for older working Americans are identified: home equity, social security compensation, and employer pensions. Several findings regarding (1) the connection between wealth distribution, poverty, and income; (2) the occupational and racial characteristics of wealth deciles; (3) discrepancies in the asset holdings across wealth deciles; (4) changes in the wealth accumulation of older working Americans between 1992 and 1996; and (5) changes in income mobility over the same period. Several methodological recommendations for future research on wealth distribution are offered, eg, taking the size of one's household into consideration since the head of household may not have access to all of the household's wealth. 17 Tables, 1 Figure, 1 Appendix. J. W. Parker %B Assets for the Poor: The Benefits of Spreading Asset Ownership %I Russell Sage Press %C New York %P 74-131 %G eng %4 Income Inequality/Income Distribution/Elderly/Poverty/United States/Wealth/Retirement/Wealth %$ 1244 %! Access to Wealth among Older Workers in the 1990s and How It Is Distributed: Data from the Health and Retirement Study %0 Book Section %B Themes in the Economics of Aging %D 2001 %T Are the Elderly Really Over-Annuitized? New Evidence on Life Insurance and Bequests %A Brown, Jeffrey R. %E David A Wise %K Adult children %K Demographics %K Insurance %K Net Worth and Assets %X This paper assesses the validity of the claim that elderly individuals with strong bequest motives purchase term life insurance to offset mandatory annuitization by the Social Security System. The annuity offset model is re-examined using better, more recent data. Results demonstrate that the elderly do not hold life insurance to offset mandated annuitization. All four of the major implications of the annuity offset model fail empirical testing. The model does not explain life insurance behavior of elderly households and the fact that many elderly households own term life insurance is not a sufficient reason to argue against mandatory annuitization of retirement resources. Further research is being conducted using the AHEAD data in order to find other explanations for why the elderly hold life insurance. %B Themes in the Economics of Aging %I University of Chicago Press %C Chicago %G eng %U http://www.nber.org/papers/w7193 %4 Life Insurance Coverage/Economic Status/Bequest Motives/Basic Demographics %$ 8430 %+ AHEAD 1993 %! Are the Elderly Really Over-Annuitized? New Evidence on Life Insurance and Bequests %0 Journal Article %J Health Affairs %D 2001 %T Betwixt and Between: Targeting coverage reforms to those approaching Medicare %A Dennis G. Shea %A Pamela F. Short %A M. Paige Powell %K Demographics %K Health Conditions and Status %K Healthcare %K Income %K Insurance %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %X Recent Medicare buy-in proposals agree on setting eligibility at age sixty-two but disagree on linking eligibility to loss of employer insurance or ability to pay. We examine arguments for targeting incremental coverage for older Americans in these ways. While access to retiree health insurance is declining, we question whether targeting loss of employer insurance can address many older Americans' insurance problems. Furthermore, focusing on persons ages sixty-two to sixty-four misses a large group of persons in poor health with limited resources. Efforts to improve coverage for older Americans should consider trade-offs between defining eligibility by age versus ability to pay. %B Health Affairs %I 20 %V 20 %P 219-30 %G eng %N 1 %L pubs_2001_Shea_DHealthAffairs.pdf %4 Age Factors/Eligibility Determination/Financing, Personal/Health Benefit Plans, Employee/Health Care Reform/Health Status/Income/Insurance Coverage/Medicare/Middle Age/Poverty/Support, Non U.S. Government %$ 4265 %R 10.1377/hlthaff.20.1.219 %0 Thesis %D 2001 %T Capital and Health Status in Near-old Adults %A Frytak, Jennifer R. %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %X Background. The existence of socioeconomic status (SES) differentials in health status has been widely recognized in the literature; the differentials appear to be widest in near-old adults (ages 55-64). Different disciplines have proposed a variety of explanatory mechanisms thought to account for the relationship between SES and health. However, no consensus has been reached in the literature regarding the best explanation for SES differentials in health. Objective. This study investigates how different types of financial, human, and social resources-defined hereafter as capital are associated with producing health in low versus high SES groups. Data source. Wave 1 (1992) and Wave 2 (1994) of the Health and Retirement Study. Study design. This research attempts to combine economic and sociological perspectives into a capital-based approach to exploring SES differentials in health. Measures of financial, human, and social capital were developed. The sample was divided into high and low SES groups. Latent variable structural equation modeling was used to examine the relative effects of the different types of capital on health for each SES group. The differences in the SES subgroup capital coefficients were compared across the subgroups. Results. Capital was found to work differently in the different SES groups. Financial capital generally had a greater direct protective effect on health in the low versus high SES group. Social capital had a greater direct protective effect on self-rated health in the high versus the low SES group; all social capital effects on health were indirect for the low SES group. The effects of human capital were mixed. Human capital generally had the largest protective effects on health within both groups. Conclusions. We found support for the contention that a differential distribution of social, personal, and economic resources within the social structure are fundamental causes of differentials in population health for near-old adults. If social stratification is not considered explicitly in health policy, a general improvement in population health may be achieved but not a lessening of the SES differentials in health. %I University of Minnesota %8 2001 %G eng %4 Health Status %$ 5007 %+ ISBN 0-493-11487-4 %! Capital and Health Status in Near-old Adults %0 Book Section %B Aging Issues in the United States and Japan %D 2001 %T Choice, Chance, and Wealth Dispersion at Retirement %A Steven F Venti %A David A Wise %E Seiritsu Ogura %E Toshiaki Tachibanaki %E David A Wise %K Net Worth and Assets %K Retirement Planning and Satisfaction %B Aging Issues in the United States and Japan %I University of Chicago Press %C Chicago %P 25-64 %G eng %4 Retirement Planning/Retirement Behavior/Wealth %$ 8676 %R 10.3386/w7521 %0 Report %D 2001 %T Cognition and Wealth: The Importance of Probabilistic Thinking %A Lee A. Lillard %A Robert J. Willis %K Health Conditions and Status %K Net Worth and Assets %X Proposed reforms of Social Security that expand household choice and private sector trends away from defined benefit pension plans toward defined contribution plans offer new financial planning options. Although these options have many potential benefits for households, critics argue that many people will fail to make choices that exploit them, and, consequently, that expanded choice will increase the risks of poverty for some populations. Subjective probabilities are key in models of optimal financial planning, yet little is known about the capacity of individuals to use probabalistic thinking in this area. In the research reported here, we used a battery of subjective probability questions administered to more than 20,000 people in the Health and Retirement Study to investigate how probabalistic thinking affects portfolio choices and net worth. Our objectives are to develop a measure of competence in probabilistic thinking and to link this measure to risk aversion and financial outcomes. %I Michigan Retirement Research Center at the University of Michigan %C Ann Arbor, MI %G eng %U https://www.ssc.wisc.edu/~jkennan/teaching/Lillard-Willis_RAND1.pdf %L wp_2001/Lillard-Willis_RAND.pdf %4 Cognition/Wealth %$ 6640 %0 Journal Article %J Journal of Risk and Insurance %D 2001 %T Demography of Risk Aversion %A Halek, Martin %A Eisenhauer, Joseph G. %K Demographics %K Insurance %K Net Worth and Assets %K Risk Taking %X This paper uses HRS data to empirically estimate the model of risk aversion and examines attitudes to both pure and speculative risks across various segments of the population. Results show that those individuals that had already engaged in the risk-taking behavior of migrating across national borders (i.e.- non-natives) are significantly more inclined than natives to both pure and speculative risks. Similarly, those who are currently employed exhibit a significantly greater willingness to gamble their current income for a chance to double it. These findings, along with the fact that women seem to be significantly more risk adverse than men, are in agreement with earlier studies and were expected. Other results, that were not as expected, show that the self-employed are significantly more adverse to pure risks than those employed by others, yet the two groups are not significantly different in their attitudes toward speculative risks. Similarly, education seems to increase aversion to pure risks but also increases the willingness to accept speculative risks. In terms of the causal relationship between risk aversion and personal characteristics, it is clear that purely demographic variables affect an individual s degree of risk aversion and that differences in religious beliefs affect attitudes toward risk-taking. Other variables produced statistically significant relationships, but causality cannot be determined. %B Journal of Risk and Insurance %I 68 %V 68 %P 1-24 %G eng %N 1 %L pubs_2001_Halek-Eisenhauer2001.pdf %4 Risk Aversion/Risk Behavior/Economic Status/Life Insurance policies/Immigrants %$ 8438 %R 10.2307/2678130 %0 Journal Article %J The Journals of Gerontology: Social Sciences %D 2001 %T Duration or Disadvantage? Exploring Nativity, Ethnicity and Health in Midlife %A Jacqueline L. Angel %A Cynthia J. Buckley %A Sakamoto, Arthur %K Demographics %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %K Women and Minorities %X Objectives This study examined nativity as a risk factor for poor physical and emotional health for an ethnically diverse population making the transition into retirement. The authors addressed whether the health disadvantage observed for immigrants lessens with increased time spent in the country (supporting theories of assimilation) or increases with duration of residence (supporting theories of cumulative disadvantage). Methods The sample was drawn from Waves 1 and 2 of the Health and Retirement Study (HRS), an in-depth economic, social, and health database of persons in midlife and beyond. The analyses were restricted to 9,912 native-born and 1,031 foreign-born individuals. Results The data revealed that after socioeconomic factors were controlled, foreign-born individuals were at higher risk of poor emotional health than their native-born counterparts. Although aging immigrants displayed worse health than the native-born population, this disadvantage was mediated by duration of residence (young age at migration) and socioeconomic incorporation. Discussion These findings extend our understanding of nativity and duration as risk factors for poor physical and emotional health. Immigrants may overcome the nativity disadvantages found for emotional distress with increased duration of residence, but the pattern becomes more complicated with the inclusion of race and Hispanic ethnicity. %B The Journals of Gerontology: Social Sciences %I 56B %V 56B %P S275-285 %G eng %U http://psychsoc.gerontologyjournals.org/ %N 5 %L pubs_2001_Angel_JJGSeriesB.pdf %4 Basic Demographics/Health Status/Duration of Residence/Assimilation/Economic Status %$ 8228 %0 Report %D 2001 %T The Effect of Federal Estate Tax Policy on Charitable Contributions %A Greene, Pamela %A Robert McClelland %K Net Worth and Assets %K Public Policy %I Congressional Budget Office %G eng %L wp_2001/Greene-McClelland_CBO.pdf %4 Assets/Tax Policy/Taxes %$ 6636 %0 Journal Article %J The Milbank Quarterly %D 2001 %T Effects of Alcohol Consumption on Disability Among the Near Elderly: A Longitudinal Analysis %A Ostermann, Jan %A Frank A Sloan %K Disabilities %K Health Conditions and Status %K Net Worth and Assets %K Social Security %X In this study the 1992, 1994, 1996, and 1998 waves of the Health and Retirement Study were used as a way to ascertain the validity of government policy changes in transfer benefits based on alcohol consumption and disability. Are heavy drinkers more likely than abstainers or moderate drinkers to be disabled and receiving transfers from SSDI or SSI? (cross-sectional analysis). How have the 1996 policy revisions changed the amount of government transfers given to the disabled who consume alcohol and the ease in receiving such receipts? (longitudinal analysis). The authors discuss many ways in which alcohol use may effect a persons body and ability to complete tasks, as well as, some ways in which preferences toward alcohol consumption can affect ones economic and financial decisions. At wave 4 in 1998 they find there is a strong correlation between rates of disability and the drinking behavior/history of drinking problems reported in Wave 1 of 1992. However, moderate drinkers were the least likely to be disabled in 1998 and the abstainers were the most likely. At the same time though, those that reported being heavy drinkers, had the most limitations on their abilities and were the most likely to be receiving SSDI or SSI transfers. The odds of death between two years (time interval between waves) was insignificant, but those who drank heavily reported more limitations at each subsequent wave. The change in policy had practically no effect on number of people collecting SSDI/SSI. Heavy and problem drinkers were less numerous among those receiving SSDI/SSI after the policy changes, but the data in this study were unable to pinpoint the specific reasons for this outcome. %B The Milbank Quarterly %I 79 %V 79 %P 487-515 %G eng %N 4 %L pubs_2001_Ostermann_JMiliQuart.pdf %4 Health Behaviors/Health Status/Economic Status/Alcohol Drinking/Supplemental Security Income/Disability/Disability %$ 8542 %0 Journal Article %J Journal of Consumer Affairs %D 2001 %T Giving Incentives of Adult Children Who Care for Disabled Parents %A Shelley I. White-Means %A Gong-Soog Hong %K Adult children %K Demographics %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X What motivates adult children in the United States to care for their disabled parents? This paper examines whether altruism and bequest motives influence adult childrens decisions about giving time to care for a disabled parent, giving financial resources, and giving future financial resources. Further, the paper examines the ways these different forms of giving affect caregivers' overall well-being, financial, family life, and life satisfaction. Using data from the 1992 Health and Retirement Study, we find that bequest incentives, noneconomicllly motivated altruism, the type of disability faced by the parent, and considerations of opportunity cost are key factors. They influence adult childrens decisions about employment, giving time, and giving money to support disabled parents. General well-being, financial and family life satisfaction are lower when adult children risk long term income resources by decreasing labor market participation. Giving money increases family life satisfaction for adult children who care for parents who have cognitive limitations. While giving time to care for disabled parents increases financial satisfaction among adult children, it decreases their family life satisfaction. %B Journal of Consumer Affairs %I 35 %V 35 %P 364-389 %G eng %N 2 %L pubs_2001_White-Means_SJConsAff.pdf %4 Altruism/Bequests/Family transfers, structure/Economic Status/Labor/Basic Demographics/Health Status %$ 8562 %R 10.1111/j.1745-6606.2001.tb00119.x %0 Report %D 2001 %T How Does Dipping into Your Pension Affect Your Retirement Wealth? %A Gary V. Engelhardt %K Net Worth and Assets %K Pensions %I Syracuse University %G eng %4 Pensions/Wealth %$ 6606 %0 Thesis %D 2001 %T The Impact of Body Weight on Physical Functioning Across the Later Years %A Kristi Rahrig Jenkins %K Adult children %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %X An extensive body of literature analyzes the impact of body weight and various health outcomes documenting that extremes in body weight adversely effect health. Much less is known about how body weight specifically impacts physical functioning. Some studies, however, have shown an association between having excessive body weight and heightened risk for certain diseases and functional impairment. With evidence that the population is becoming heavier in greater proportions than in the past, body weight as it contributes to physical functioning remains a critical health problem. The project addresses some of the questions central to body weight and physical functioning. For example, how do certain socioeconomic and demographic characteristics, health behaviors, and health characteristics effect the relationship between body weight and physical functioning? Is the effect of body weight specific to certain functional domains? In addition, is the basic relationship between body weight and physical functioning different in young old populations than in old old populations? Using longitudinal data from the Health and Retirement Study (sample of young old adults) and asset and health dynamics among the oldest old survey (sample of old old adults) logistic regression models on the loss of physical functioning (1 = impaired) over a two year period are estimated for the young old and old old separately. A model comparing the young old and the old old is also estimated. Results indicate that body weight, more specifically obesity, impacts physical functioning across various domains of impairment. When influencing these domains, body weight acts directly but also indirectly with other factors (socioeconomic and demographic characteristics, health behaviors, and health characteristics). In addition, important differences exist by cohort membership. The project concludes by addressing implications and areas for future research. %I Wayne State University %8 2001 %G eng %U Database ID: DAI-A 62/12, p. 4349, Jun 2002 %4 Gerontology (0351) %$ 5012 %+ ISBN 0-493-50454-0 %! The Impact of Body Weight on Physical Functioning Across the Later Years %0 Report %D 2001 %T The Impact of Own Children on Retirement Portfolio Composition in the United States %A Jennifer M Mellor %A Jensen, Eric R. %K Net Worth and Assets %X We estimate models of retirement portfolio compositions using Wave 1 of the Health and Retirement Survey. The sample consists largely of pre-retirement individuals in their early 50s. Treating number of own children as endogenous, we find little firm evidence that either levels of specific asset holdings or their shares in a portfolio of assets are affected by number of own children. The exception is housing wealth, which also carries a significant consumption component. While some parents may well come to rely on their children for retirement support, we cannot support the notion that it typically is intentional. %I College of William and Mary, Dept. of Economics %G eng %4 Retirement Wealth/Assets %$ 6602 %0 Report %D 2001 %T Impute: A SAS Application System for Missing Value Imputations-With Special Reference to HRS Income/Assets %A Cao, Honggao %K Income %K Methodology %K Net Worth and Assets %X Survey questions that ask respondents to report amounts are often subject to high rates of missing data (Heeringa, Hill, and Howell, 1995; Hill, 1999; Juster and Smith, 1998). To avoid losing altogether valuable information from those who are unable or unwilling to provide answers to amount questions, more and more researchers rely on special questionnaire designs to collect bracket information, trying to infer exact amounts from the brackets collected. The work involving an inference of exact amount from bracket information may be called missing value imputation with brackets . When the bracket information is not available, it is reduced to a general type of imputation, called here missing value imputation without brackets . In this document, we describe a SAS application system, IMPUTE, designed for missing value imputation without brackets in general, and for inferring exact amount from bracket information in particular. To navigate our tour, and as a motivation for this project, we shall pay special attention to the Health and Retirement Study (HRS) income and assets imputations. Among many other advantages, the HRS income and asset data sets provide a good example for illustrating the uses of, and the limits to, the system. %I Institute for Social Research, University of Michigan %C Ann Arbor, Michigan %G eng %1 This document is obsolete, but is preserved here for historical reference. %4 Survey Methods/Income/Assets %$ 14062 %0 Journal Article %J Financial Services Review %D 2001 %T Longitudinal Changes in Net Worth by Household Income and Demographic Characteristics for the first three waves of HRS Data %A Karen E. Lahey %A Kim, Doseong %K Adult children %K Income %K Methodology %K Net Worth and Assets %X The purpose of this study is to provide an initial examination of the first three waves of HRS in terms of non-housing net worth by gender, education, race, religion, income, and age. The longitudinal data that is available for a sample of those who are nearing retirement or in retirmenet allows a picture of their financial condition to be drawn. Statistical analysis indicates that there is a difference in non-housing net worth by demographic characteristics and material status for each wave of data. %B Financial Services Review %I 10 %V 10 %P 55-73 %G eng %N 1-4 %L pubs_2001_Lahey_KFinServRev.pdf %4 retirement adequacy/household behavior/net worth distribution/longitudinal analysis %$ 11812 %R 10.1016/S1057-0810(02)00100-2 %0 Thesis %D 2001 %T Nursing Home Residents' and Family Caregivers' Strategies in Financing the Costs of Long-Term Care %A Mikolas-Peters, Cynthia Jean %K Healthcare %K Net Worth and Assets %X This dissertation studies the ways nursing home residents and caregivers manage the costs of chronic illness and the long-term care services provided during these episodes of illness. Of particular interest was how life-course events and family background affect the ability of the disabled elderly to privately finance costs in the context of Medicaid spend-down requirements. Few studies have actually looked specifically at the influence of age and health on strategies elderly residents and their families use to finance long-term care. This study was a direct result of the lack of longitudinal surveys that include adequate measures of both the health and financial status of this population. This dissertation combines both qualitative and quantitative data sources to address these issues. The experiences of the disabled elderly were examined in an exploratory study over a three-year period. The second data source was from the first wave of the Asset and Health Dynamics Among the Oldest Old (AHEAD) study. Combining these two data sources were necessary in order to deeply examine the nature and consequences of changes in financing long-term care among this age group. The study's major finding was the identification of distinct strategies for financing long-term care and the importance of a continuum in explaining differences in the consumption of resources and strategies to finance care. The quality of care for the chronically ill was not addressed in this continuum. Residents' abilities to privately finance care were limited or undermined altogether when health problems and age compromised their independence to fund their care. Recognition that their experiences vary along a continuum was important since it corresponds to a decline in their wealth and maintaining control to avoid the consumption of savings and assets. Caregivers contributed support and provided services to avoid the dissaving required to finance the consumption of highly specialized services. These findings suggest that the role of the caregiver may need to be improved. Caregiver burdens are not distributed uniformly over the non-patient population among families whose parents' may or may not need care, and who contract illnesses of varying length or physical suffering. %I University of Chicago %8 2001 %G eng %4 Nursing Homes %$ 16300 %! Nursing Home Residents' and Family Caregivers' Strategies in Financing the Costs of Long-Term Care %0 Report %D 2001 %T Planning for Retirement: The Accuracy of Expected Retirement Dates and the Role of Health Shocks %A Debra S. Dwyer %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X This paper illustrates the effect that unexpected health changes could have on a person s retirement decision and future. It is believed by the researchers that retirement age is something that a person decides over the course of their life by thinking of many factors that could influence their welfare in retirement. An economic model is designed in order to understand possible effects of different factors and health shocks on retirement age. Various policies and retirement plans are examined along with in-depth econometric and strategic models. Health prevailed as a key predictor in ones retirement decision. The occurrence of a shock in ones health normally forces the worker to retire sooner than had been anticipated. Net worth, social security, and pension plans are all important in making the initial retirement plan, but have little effect on the outcomes based on the plan. %B Center for Retirement Research at Boston College Working Papers %I Boston College %C Boston %G eng %U https://crr.bc.edu/working-papers/planning-for-retirement-the-accuracy-of-expected-retirement-dates-and-the-role-of-health-shocks/ %L wp_2001/CRRwp_2001-08.pdf %4 Retirement Planning/Pension/Net Worth %$ 6629 %0 Report %D 2001 %T The Potential Effects of Cash Balance Plans on the Distribution of Pension Wealth at Midlife %A Richard W. Johnson %A Cori E. Uccello %K Net Worth and Assets %K Pensions %X Recent pension plan conversions by numerous large employers have sparked debate about the merits of cash balance plans. This paper compares pension wealth in traditional defined benefit (DB) plans and cash balance plans for a national sample of covered Americans ages 51 to 61. The simulations indicate that replacing DB plans with cash balance plans would redistribute pension wealth from those who held long-term jobs for many years to those with multiple short-term jobs. Women at midlife in 1992 with DB coverage would have lost wealth in cash balance plans, but future cohorts of women are likely to fare better. %B The Urban Institute Research Report %I The Urban Institute %C Washington, D.C. %G eng %U https://www.urban.org/research/publication/potential-effects-cash-balance-distribution-pension-wealth-midlife %4 Pension Wealth/Pension Plans/Distribution %$ 8484 %0 Book Section %B Themes in the Economics of Aging %D 2001 %T Predictors of Mortality among the Elderly %A Michael D Hurd %A Daniel McFadden %A Merrill, Angela %E David A Wise %K Demographics %K Expectations %K Health Conditions and Status %K Net Worth and Assets %X This paper examines the quantitative importance of some predictors of mortality among the population aged 70 and over. As expected, this research confirms that socioeconomic status is related to mortality. This relationship is strong at younger ages and appears to weaken as the cohort gets older. The 13 health indicators are also strong predictors of mortality. Results also show that subjective probabilities of survival predict mortality and remain strong predictors even after controlling for socioeconomic indicators and health conditions. %B Themes in the Economics of Aging %I Univ. of Chicago Press %C Chicago %G eng %U https://www.nber.org/papers/w7440 %4 Basic Demographics/Economic Status/Health Status/Subjective Probabilities of Survival/Mortality Rates between waves 1 and 2 of the AHEAD %$ 8432 %+ AHEAD 1993 and 1995 %! Predictors of Mortality among the Elderly %0 Book Section %B Themes in the Economics of Aging %D 2001 %T Preretirement Cashouts and Foregone Retirement Saving: Implications for 401(k) Asset Accumulation %A James M. Poterba %A Steven F Venti %A David A Wise %E David A Wise %K Consumption and Savings %K Net Worth and Assets %K Pensions %B Themes in the Economics of Aging %I University of Chicago Press %C Chicago, IL %P 23-58 %G eng %U https://www.nber.org/chapters/c10320 %4 401(k) participation and balances/Retirement Saving/Distribution %$ 8650 %! Preretirement Cashouts and Foregone Retirement Saving: Implications for 401(k) Asset Accumulation %0 Journal Article %J Journal of Public Economics %D 2001 %T Private Pensions, Mortality Risk, and the Decision to Annuitize %A Brown, Jeffrey R. %K Net Worth and Assets %K Pensions %B Journal of Public Economics %I 82 %V 82 %G eng %N 1 %4 Annuities/Pensions %$ 8328 %R 10.1016/S0047-2727(00)00152-3 %0 Journal Article %J Social Security Bulletin %D 2001 %T Racial and Ethnic Differences in Wealth and Asset Choices %A Choudhury, Sharmila %K Demographics %K Net Worth and Assets %X White households in the United States are far wealthier than black or Hispanic households, a disparity that remains unexplained even after taking into account income and demographic factors. This article uses data from the Health and Retirement Study to examine various components of aggregate wealth, including housing equity, nonhousing equity, financial assets in general, and risky assets in particular. It inspects asset choices by race and ethnicity and assesses whether differences in saving behavior--and, consequently, in rates of return on assets--are possible sources of the wealth gap. It also demonstrates the equalizing effect of pension wealth and Social Security wealth on total wealth. Racial and ethnic differences in housing equity narrow among households in the higher income quartiles, whereas differences in nonhousing equity generally widen as income increases. The widening gap in nonhousing equity stems from differences in financial asset holdings, particularly risky assets. At every income quartile and educational level, the percentage of black and Hispanic households that own risky, higher-yielding assets is considerably smaller than the percentage of white households. Thus, some of the wealth gap appears to be attributable to differences in saving behavior. Understanding how people save--in particular, knowing whether certain people will be more vulnerable financially because of their saving choices--helps policymakers assess older Americans' financial preparedness for retirement and anticipate their economic well-being thereafter. Lower rates of investment in the financial market will probably result in slower wealth creation in minority households. Recognizing this, some organizations are trying to open opportunities for minority households to invest in the financial market. This is a positive step toward narrowing the wealth divide. Such efforts will become even more critical if Social Security reform places increased responsibility on individuals to manage personal accounts. %B Social Security Bulletin %I 64 %V 64 %P 1-15 %G eng %U http://www.ssa.gov/policy/docs/ssb/v64n4/v64n4p1.html %N 4 %L pubs_2002_Choudhury.pdf %4 Racial Differences/Wealth Accumulation/asset choice %$ 11612 %0 Journal Article %J Research on Aging %D 2001 %T Racial, Ethnic, and Sociodemographic Differences in the level of Psychosocial Distress Among Older Americans %A Mills, Terry L. %A John C Henretta %K Demographics %K Health Conditions and Status %K Net Worth and Assets %K Women and Minorities %X This paper explores the reasons for the observed differences in the level of self-reported depressive symptoms between older African Americans, Hispanic-English speaking, Hispanic-Spanish speaking, and Whites. For all groups in the sample, being male, married, having a high level of education, and good health are strong indicators of lower levels of depressive symptoms. Comparing the levels of self-reported depressive symptoms among the different racial/ethnic groups demonstrated that there are large differences, with the Hispanic-Spanish speaking individuals reporting the highest scores. Results show that language acculturation, the number of years of education, and the number of years of U.S. residency are significant factors that help to explain these differences. %B Research on Aging %I 23 %V 23 %P 131-152 %G eng %N 2 %L pubs_2001_Mills_TRoA.pdf %4 Depressive Symptoms/African-Americans/Hispanics/Whites/Economic Status/Health Status/Acculturation %$ 8524 %R 10.1177/0164027501232001 %0 Journal Article %J Social Security Bulletin %D 2001 %T Retirement and Wealth %A Alan L Gustman %A Thomas L. Steinmeier %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This article analyzes the relationship between retirement and wealth. Using data from the first four waves of the longitudinal Health and Retirement Study—a cohort of individuals born from 1931 to 1941—we estimate reducedform retirement and wealth equations. Our results show that those who retire earlier do not necessarily save more and that even if one’s primary interest is in the relationship between Social Security policy and the decision to retire, it is important to incorporate saving behavior and other key decisions into the analysis. %B Social Security Bulletin %I 64 %V 64 %G eng %U https://www.ssa.gov/policy/docs/ssb/v64n2/v64n2p66.pdf %N 2 %L pubs_2002_Gustman_ASSB.pdf %4 Wealth/Retirement %$ 8462 %0 Report %D 2001 %T Retirement Incentives and Expectations %A Sewin Chan %A Ann H. Stevens %K Employment and Labor Force %K Expectations %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper investigates the relationship between expectations concerning retirement and incentives for retirement provided by employer-sponsored pension plans and Social Security. Measures of pension wealth and broader measures including earnings, Social Security, and assets are significantly related to individuals' expectations to continue work in their 60s. Results show that individuals strongly consider these incentives when planning for retirement. However, the degree to which these incentives affect behavior varies greatly between OLS and fixed-effects estimation strategies. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge, MA %G eng %U http://www.nber.org/papers/w8082 %4 Expectations of Future Events/Labor Force/Economic Status/Health Status/Retirement Planning %$ 6595 %0 Report %D 2001 %T Retirement Planning %A Loughran, David %A Panis, Constantijn %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This report is concerned with two issues. First, it describes when individuals near retirement age plan to retire, and documents how their characteristics differ by planned retirement age. Second, it evaluates how accurately these individuals predict the timing of their retirement, and documents how good planners differ from poor planners. Consistent with earlier studies of retirement expectations, we demonstrate that retirement expectations in the HRS are closely correlated with many of the standard determinants of actual retirement. Broadly speaking, workers who expect to retire before age 62 tend to be wealthy and have generous pensions. Private pension incentives play an important role in determining retirement expectations. Individuals with private pensions are disproportionately represented among individuals expecting to retire early and, conditional on having a private pension, access to early pension benefits greatly increases the odds of planning an early retirement. Private pension wealth declines considerably with expected retirement age further suggesting that individuals are responsive to private pension plan incentives. There is little correlation between Social Security wealth and expected retirement age. There is strong evidence that spouses coordinate their retirement plans. The simple correlation between the expected retirement ages of husbands and wives is 0.43. Perhaps somewhat surprisingly, though, only 14 percent of couples expect the husband and wife to retire in the same year. In 50 percent of cases, husbands report that they expect to retire after their wives retire. %I Washington, DC, RAND Labor and Population Program; Prepared for the Social Security Administration %G eng %4 Pension Wealth/Retirement Planning %$ 9882 %0 Report %D 2001 %T Risk Preferences and the Investment Decisions of Older Americans %A Bajtelsmit, Vickie L. %A Bernasek, Alexandra %K Net Worth and Assets %K Risk Taking %X The three-legged stool of retirement income policy assumes that, in addition to relying on projected Social Security benefits, individuals will participate in private pensions and will save on their own to ensure an adequate post-retirement standard of living. Examination of individual portfolios reveals that for many households, accumulated wealth may be insufficient to accomplish this goal. Although part of the problem is that households simply have lower savings rates than in previous generations, we also observe high levels of personal debt, a large proportion of household portfolios invested in housing, and substantial investment in low-risk assets. Since riskier portfolios generally result in higher returns for long-term investors, overly conservative investment behavior may result in reduced retirement wealth. Given the trend in private and public pensions to allow more participant choice in retirement savings asset allocation, individual risk aversion is an important policy issue. This report reviews and synthesizes research findings on individual risk aversion and investment allocation. It then uses the Health and Retirement Study (HRS) to estimate risk preferences and to evaluate the factors that impact asset allocation in individual and household portfolios for a sample of older Americans. Of particular interest is the examination of differences in risky allocation decisions between women and men in the sample and investigation of the factors that impact investment decisions for each of these groups, including age, race, income, wealth, marital status, and education. %I Public Affairs at AARP %G eng %U https://assets.aarp.org/rgcenter/econ/2001_11_risk.pdf %L wp_2001/Bajtelsmit.pdf %4 Investments/Risk Aversion %$ 10712 %0 Journal Article %J The Journal of Human Resources %D 2001 %T Savings of Young Parents %A Annamaria Lusardi %A Cossa, Ricardo %A Krupka, Erin L. %K Consumption and Savings %K Net Worth and Assets %X In this paper, we examine household savings using data from the National Longitudinal Survey, Cohort 1997. This data set provides detailed information about assets and liabilities of parents with teenage children. In our empirical work, we have to first deal with several problems in measuring wealth. Although many responding parents report owning assets and liabilities, they often do not report their values. To get around the nonresponse problem, we impute the missing values for assets and liabilities. To study the patterns of accumulation of young parents, we examine wealth holdings and asset ownership across several demographic groups. %B The Journal of Human Resources %I 36 %V 36 %P 762-794 %G eng %N 4 %4 Wealth/Savings %$ 12052 %R 10.2307/3069641 %0 Book Section %B Themes in the Economics of Aging %D 2001 %T Social Security Incentives for Retirement %A Courtney Coile %A Gruber, Jonathan %E David A Wise %K Demographics %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %X The 'tax effect' is one of the effects used to explain the rapid decline in the labor force participation of older men over age 62. This paper provides a thorough investigation of this 'tax effect' by studying it along four different dimensions. Using HRS data, the impact of SS retirement incentives are considered and the distribution of the incentives across the population is assessed. The paper then examines the role of private pensions and the importance of considering retirement incentives in the next year vs. considering incentives for all possible years. %B Themes in the Economics of Aging %I Univ. of Chicago Press %C Chicago %G eng %U https://www.nber.org/papers/w7651 %4 Economic Status/Labor Force Participation/Basic Demographics/Retirement Incentives %$ 8428 %+ HRS 1992 and 1994 %& 10 %0 Report %D 2001 %T Technical progress and early retirement %A Ahituv, Avner %A Zeira, Joseph %K Employment and Labor Force %K Net Worth and Assets %I Hebrew University of Jerusalem %G eng %L wp_2001/Ahituv-Zeira11-01.pdf %4 Labor Force/Human Capital %$ 6578 %0 Thesis %B Economics %D 2001 %T Three Essays on the Estate Tax %A Donald Marples %K Adult children %K Employment and Labor Force %K Net Worth and Assets %K Other %K Public Policy %X The United States estate tax has recently attracted a great deal of popular and professional attention, despite the paucity of information regarding its effects on economics behavior. One possible reason for this void in the literature is that it affects relatively few individuals. Thus, while the high marginal tax rates of the estate tax provide substantial incentive for individuals to alter their behavior, the relatively small numbers make empirical work difficult. This collection of essays, utilizing the Health and Retirement Study and state level estate tax variation, provides insight on three previously unexamined topics. The first essay, "Labor Supply Effects of the Estate Tax" examines the labor supply responses of individuals to the estate tax. As with the familiar income tax, the predicted impact of the tax is ambiguous, a priori, due to conflicting income (raising the estate tax lowers the purchasing power of assets and endowment) and substitution (the price of inheritances rise) effects. However, after controlling for other aspects of the labor force participation decision and employing an instrumental variables procedure to eliminate endogeneity bias from several sources, I find that the estate tax lowers labor force participation. In particular, a 10 percentage point increase in the estate tax lowers labor force participation by between 1.884 And 2.988 Percentage points, corresponding to elasticities ranging from -0.0887 to -0.137. In the second essay, "Distortion Costs of Taxing Wealth Accumulation: Income Versus Estate Taxes" I develop a framework for computing the deadweight loss of a revenue-neutral switch from an estate tax to a capital income tax, focusing on the potential lifetime behavioral responses in anticipation of paying the estate tax, while requiring relatively few parameters to estimate. I conclude that eliminating the estate tax and replacing the revenue with that from a capital income tax will likely enhance economic efficiency. Specifically, using my baseline parameter estimates I estimate that the mean decrease in deadweight loss is $0.018 per dollar of wealth. In the final essay, "Estate Taxes and Marginal Incentives: Evidence from the Health and Retirement Study" I first design a complex effective estate tax calculator and then apply it to Wave 1 of the Health and Retirement Study. As with more familiar taxes, the effective estate tax rates are less than the statutory estate tax rates that currently frame the policy debate. In particular, I find an effective combined federal and state marginal estate tax rate is 0.53 percent for the sample and 0.85 percent conditional on having a positive expected estate tax liability. Additionally, single individuals face effective estate tax rates over fifty times greater than married couples and entrepreneurs face effective estate tax rates forty percent greater than non-entrepreneurs. This collection of papers represents a contribution to the literature regarding the effects of taxes on economic behavior. Specifically, these papers substantially broaden the literature on the estate tax and illuminate an identification strategy that can be utilized to further study the estate tax %B Economics %I Syracuse University %C Syracuse, NY %V Doctor of Philosophy %8 2001 %G eng %U https://surface.syr.edu/ecn_etd/52/ %4 Economics, Labor (0510) %$ 5015 %+ ISBN 0-493-29769-3 %0 Thesis %D 2001 %T Two Essays Related to Labor Market Behavior: Demand for publicly provided job training programs in Illinois and Poor health, asset accumulation, and early retirement behavior %A Miah, Mohammad Solaiman %K Education %K Employment and Labor Force %K Health Conditions and Status %K Income %K Net Worth and Assets %K Other %K Retirement Planning and Satisfaction %X Essay 1. This essay examines the determinants of the demand for public job training programs in Illinois. My first objective is to determine which personal characteristics influence support for an increase in spending on publicly provided job training programs for the unemployed across various income groups in Illinois. In particular, I empirically test for a u- shaped relationship between income and the demand for publicly-provided job training. My second objective is to examine the role of local economic conditions in determining the demand for job training programs. I use data from the 1995 Illinois policy survey supplemented with county- and regional-level data (including the unemployment rate, manufacturing employment, population density, and poverty rate). I do not find a u-shaped relationship between income and the demand for job training. However, I find that regional economic conditions, particularly the unemployment rate, the poverty rate, and population density, significantly influence the demand for job training programs in Illinois. In contrast, I find county-level economic conditions are not very influential. Essay 2. The purpose of this essay is to examine the impact of chronic health conditions on asset accumulation and retirement. Compared to a healthy worker, a person with a chronic health condition throughout his or her working life may have had reduced labor force participation and may have built a smaller portfolio of assets. Because this individual will have lower asset income than a healthy person, he or she will be less likely to retire, other things equal. Thus, chronic poor health may lead to opposing effects on the labor supply of the elderly. In my empirical analysis, I use data on adults aged 51-61 from the Health and Retirement Study (HRS) to study asset accumulation and retirement behavior of the chronically ill. I find that for 90% of individuals with chronic health problems, asset accumulation is sufficiently reduced to delay retirement. The needs of this group have not been addressed by researchers or policy makers discussing critical issues surrounding poor health and retirement. %I Northern Illinois University %8 2001 %G eng %4 Education, Vocational (0747) %$ 5016 %+ 0-493-23496-9 %0 Journal Article %J Urban Studies %D 2001 %T What Makes a Landlord? Ownership of Real Estate by US Households %A Shroder, Mark %K Adult children %K Consumption and Savings %K Employment and Labor Force %K Housing %K Net Worth and Assets %X Households supply about three-quarters of US rental housing. The paper examines the real estate investment decision and the proportion of wealth invested in real estate. Hypotheses drawn primarily from the real estate finance literature about the role of wealth, expected inflation, human capital, income tax rates, race, health, risk aversion and inheritance are tested against data from the Health and Retirement Study. Wealth has a powerful non -linear effect on ownership of real estate, but ownership is negatively associated with human capital. Marginal tax rates, race and property gifts affect real estate investment; poor health, risk aversion and expected inflation do not seem to. %B Urban Studies %I 38 %V 38 %P 1069-81 %G eng %N 7 %4 Housing Supply and Markets/Household effects on labor supply/Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Households/Housing/Real Estate/Wealth %$ 1096 %R 10.1080/00420980120051657 %0 Journal Article %J Financial Services Review %D 2000 %T Beliefs and Actions: Expectations and Savings Decisions by Older Americans %A Elder, Harold W. %A Rudolph, Patricia M. %K Demographics %K Expectations %K Net Worth and Assets %X This article explores the interaction of savings behavior, pension fund participation, and expectations of retirement well being. As expected from previous research, pension benefits are seen as substitutes for savings. Results also indicate that accumulated savings have a significant impact on the expected standard of living but pension plan participation does not. %B Financial Services Review %I 9 %V 9 %P 33-45 %G eng %L pubs_2000_Elder_HFinSerRev.pdf %4 Economic Status/Expected Standard of Living in Retirement/Basic Demographics %$ 8414 %R 10.1016/S1057-0810(00)00054-8 %0 Book %D 2000 %T The Case for Marriage: Why Married People are Happier, Healthier, and Better Off Financially %A Linda J. Waite %A Gallagher, Maggie %K Adult children %K Health Conditions and Status %K Net Worth and Assets %X The Case for Marriage is a critically important intervention in the national debate about the future of family. Based on the authoritative research of family sociologist Linda J. Waite, journalist Maggie Gallagher, and a number of other scholars, this book’s findings dramatically contradict the anti-marriage myths that have become the common sense of most Americans. Today a broad consensus holds that marriage is a bad deal for women, that divorce is better for children when parents are unhappy, and that marriage is essentially a private choice, not a public institution. Waite and Gallagher flatly contradict these assumptions, arguing instead that by a broad range of indices, marriage is actually better for you than being single or divorced– physically, materially, and spiritually. They contend that married people live longer, have better health, earn more money, accumulate more wealth, feel more fulfillment in their lives, enjoy more satisfying sexual relationships, and have happier and more successful children than those who remain single, cohabit, or get divorced. %I Doubleday %C New York %G eng %4 Marriage/Health Status/Economic Status %$ 8686 %0 Report %D 2000 %T Differential Mortality and the Value of Individual Account Retirement Annuities %A Brown, Jeffrey R. %K Income %K Net Worth and Assets %X This paper examines the extent of redistribution that would occur under various annuity and bequest options as part of an individual accounts retirement program. I first estimate mortality differentials by gender, race, ethnicity and level of education using the National Longitudinal Mortality Study and document substantial differences. I then use these estimates to examine the expected transfers that would take place between socioeconomic groups under different assumptions about the structure of an annuity program. Using an expected present discounted value or money s worth calculation as the basis for comparison, I find that the size of transfers in an individual accounts program is highly sensitive to the benefit structure. For example, mandating a single-life, real annuity can result in expected transfers of as high as 20 of the account balance, often from economically disadvantaged groups toward groups that are better off. These transfers can be substantially reduced through the use of joint life annuities, survivor provisions and bequest options. For example, the largest expected negative transfer under a joint and full survivor annuity with a fully valued 20-year guarantee option is only 2 of the account balance. However, efforts to reduce the extent of redistribution generally do so at the cost of significantly lower annuity benefits paid to the individuals who contribute to the system. %I National Bureau of Economic Research, NBER Working Paper 7560 %G eng %U http://www.nber.org/papers/ %L wp_2000/JBrown_NBER.pdf %4 Annuities/redistribution %$ 8423 %0 Book Section %B Forecasting Retirement Needs and Retirement Wealth %D 2000 %T Early Retirement Windows %A Charles Brown %E Olivia S. Mitchell %E Hammond, B. %E Rappaport, A. %K Net Worth and Assets %K Retirement Planning and Satisfaction %B Forecasting Retirement Needs and Retirement Wealth %I Univ. of Pennsylvania Press %C Philadelphia %P 253-273 %G eng %U https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ %4 Retirement/Early out Windows/Wealth/Retirement Planning %$ 8422 %! Early Retirement Windows %& 9 %0 Report %D 2000 %T Elderly Asset Management and Health: An Empirical Analysis %A Feinstein, Jonathan S. %A Ho, Chih-Chin %K Adult children %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X We present models of asset management by the elderly. We focus on saving, spend-down of assets, and gift-giving, and the influence of health on these precesses. We also study the evolution of elderly health and the impact of economic variables on health outcomes. We present results from estimating our models using data from waves one and two of the AHEAD dataset. Our model of asset management links elderly decisions about saving, spend-down of assets, and gift-giving in a system of equations. We divide households for which head and partner (if present) are in poor health and those for which head and partner are in good health; our specification allows for differences in health to affect both the average level of economic outcomes and the marginal effects of income and wealth on the outcomes. We also include in our model a set of sociodemographic control variables. Our model of health outcomes links health in the preceding period to health in the current period, allowing for three outcomes good health, poor health, or death. In our models of health outcomes we include variables measuring health in the previous period, wealth, age, education, and control variables. Our main results are the following. First, results for gift-giving suggest that at least some elderly do plan their estate transfer - those that have established trust funds or for which households assets exceed the estate tax filling threshold have a significantly greater propensity to give gifts. Second, the average level of gift-giving is lower for those in poor health, but the marginal effect of increasing wealth on gift-giving is much greater. This result is important in showing the ways in which health can interact with economic variables in influencing economic decision-making. Third, income is an important determinant of saving and spend-down. Fourth, other things equal, households that save are also more likely to give gifts. Fifth, sudden changes in family structure and health are associated with changing patters of economic behavior - most especially, becoming a widow or widower is associated with a significant increase in the likelihood both of spending out of assets and of making gifts. Finally, variables related to children have less effect on propensity to give gifts than expected - the only variable that has a significant effect is the number of children for which parents cannot provide income information, suggesting that the quality of the relationship between parents and children is important for gift-giving. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge, MA %G eng %U https://www.nber.org/papers/w7814 %4 Assets/Health Status/Economic Status/Family Structure/Basic Demographics %$ 6590 %0 Journal Article %J Research in Labor Economics %D 2000 %T Employer Provided Pension Data in the NLS Mature Women's Survey and in the Health and Retirement Study %A Alan L Gustman %A Thomas L. Steinmeier %K Consumption and Savings %K Employment and Labor Force %K Income %K Methodology %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %B Research in Labor Economics %I 19 %V 19 %P 215-252 %G eng %4 Personal Income and Wealth Distribution/Economics of the Elderly/Economics of Gender/Retirement/Retirement Policies/Nonwage Labor Costs and Benefits/Private Pensions/Pension Wealth/Pension %$ 8210 %0 Book Section %B Forecasting Retirement Needs and Retirement Wealth %D 2000 %T Evaluating Pension Entitlements %A Alan L Gustman %A Olivia S. Mitchell %A Andrew A. Samwick %A Thomas L. Steinmeier %E Olivia S. Mitchell %E Hammond, B. %E Rappaport, A. %K Net Worth and Assets %K Pensions %K Public Policy %B Forecasting Retirement Needs and Retirement Wealth %I University of Pennsylvania Press %C Philadelphia %P 309-326 %G eng %U https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ %4 Pensions/Entitlements/Wealth %$ 8140 %+ The Wharton School, University of Pennsylvania %& 12 %0 Journal Article %J American Economic Review %D 2000 %T How Much Should Americans Be Saving for Retirement? %A Bernheim, B. Douglas %A Forni, Lorenzo %A Gokhale, Jagadeesh %A Laurence J. Kotlikoff %K Demographics %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Deciding if HRS households are saving too much or too little cannot be determined from the data alone. However, by applying the ESPlanner to the data, the rate at which American households should be saving as they approach retirement can be determined. Households that are currently saving under the assumption that Social Security benefits will be paid in full are saving far too little. For all households besides the poorest ones in the sample, median recommended saving rates are fairly high because of the risk of major cuts in Social Security benefits. %B American Economic Review %I 90 %V 90 %P 288-92 %G eng %N 2 %L pubs_2000_Bernheim_etal.pdf %4 Retirement Planning/Economic Status/Basic Demographics %$ 8398 %R 10.1257/aer.90.2.288 %0 Book Section %B Forecasting Retirement Needs and Retirement Wealth %D 2000 %T New Paths to Retirement %A Joseph F. Quinn %E Olivia S. Mitchell %E Hammond, B. %E Rappaport, A. %K Consumption and Savings %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %B Forecasting Retirement Needs and Retirement Wealth %I Univ. of Pennsylvania Press %C Philadelphia %P 13-32 %G eng %U https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ %4 Economics of the Elderly/Retirement/Retirement Wealth/Retirement Policies/Labor Force/Employment %$ 8416 %! New Paths to Retirement %0 Magazine Article %D 2000 %T Older Workers Sweat Boom Times %A Rosenblatt, Robert A. %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X This article looks at the first four waves of HRS data (1992-1998) to evaluate how older workers are affected by this period of economic boom. David Weir of the University of Michigan, Associate Director of the HRS, comments throughout the article on general trends and findings that can be seen in the data. The study shows that Americans have become wealthier, are more likely to be working in their 50s and 60s, and are increasingly worried about their health. %B Aging Today %V Nov/Dec %8 2000 %G eng %4 Economic Status/Labor Force Participation/Health Status %$ 8592 %0 Report %D 2000 %T Patterns of Dissaving in Retirement %A Steven Haider %A Michael D Hurd %A Reardon, Elaine %A Williamson, Stephanie %K Consumption and Savings %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Abstract: Examined patterns of dissaving among households with at least one older adult. Data were obtained from the Social Security Administration's New Beneficiary Data System (NBDS) on older adults (mainly those aged 62-65) who received Social Security benefits for the first time in 1980-1981 and who were interviewed in 1982 and 1991. Data were also obtained from the 1993 and 1995 waves of the National Institute on Aging's Asset and Health Dynamics Among the Oldest Old (AHEAD) survey of adults aged 70 and older. Multivariate analyses indicated that changes in wealth were fairly flat in the 1980s (based on NBDS data), with mean wealth growing just under one percent per year for the 9 years of the sample period, while median wealth declined by about one-quarter of a percentage point per year. The AHEAD data from the 1990s suggest that most adults aged 70 and older enjoyed wealth increases, which in large part were due to the dramatic rise in stock prices over the 2 years of the survey period. Overall, there was increasing wealth inequality, with less well off households dissaving more rapidly than better off households. Households in which health declined between the waves studied were more likely to dissave. Savings patterns of households with and without children were fairly similar. Two appendixes provide information on the study methodology and additional data tables %I AARP Public Policy Institute %C Washington, D.C. %G eng %U https://assets.aarp.org/rgcenter/econ/2000_10_dissaving.pdf %L wp_2000/dissaving.pdf %4 Assets/Wealth/RETIREMENT/Dissaving %$ 16140 %0 Newspaper Article %B The New York Times %D 2000 %T Patterns: When Obesity Comes With a Price Tag %A Nagourney, Eric %K Health Conditions and Status %K Net Worth and Assets %B The New York Times %I The New York Times Co. %C New York, NY %8 November 28, 2000 %G eng %4 Health Status/Economic Status/Obesity %$ 9830 %! Patterns: When Obesity Comes With a Price Tag %0 Journal Article %J Review of Income and Wealth %D 2000 %T Pension Wealth at Midlife: Comparing Self-Reports with Provider Data %A Richard W. Johnson %A Sambamoorthi, Usha %A Crystal, Stephen %K Employment and Labor Force %K Methodology %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X This paper evaluates the accuracy of estimates of pension wealth based on self-reports by comparing them to estimates based on provider data. Using data from the Health and Retirement Study, we found that few workers are well informed about their future pension benefits. Self-reports were often incomplete and typically varied widely from those based on information from providers. In defined benefit (DB) plans, discrepancies were greatest for workers who had limited education, earned low wages, and did not expect to retire soon. Differences in median pension wealth were smaller at the aggregate level than the individual level, because individual differences tended to offset each other when aggregated. Provider data appear better than self-reports for DB plans, but not for defined contribution (DC) plans. Where both are available, the best method of computing pension wealth may be to estimate DB wealth from provider data and to estimate DC wealth from self -reports. %B Review of Income and Wealth %I 461 %V 461 %P 59-83 %G eng %N 1 %4 Nonwage Labor Costs and Benefits/Private Pensions/Retirement/Retirement Policies/Pension Wealth/Pension Provider Survey/Pension Plans %$ 1168 %R 10.1111/j.1475-4991.2000.tb00391.x %0 Journal Article %J Journal of Human Resources %D 2000 %T Pensions and Retiree Health Benefits In Household Wealth: Changes From 1969 to 1992 %A Alan L Gustman %A Thomas L. Steinmeier %K Medicare/Medicaid/Health Insurance %K Net Worth and Assets %K Pensions %B Journal of Human Resources %I 35 %V 35 %P 30-50 %G eng %N 1 %L pubs_2000_Gustman_AJHR.pdf %4 Pensions/Health Benefits/Wealth %$ 8182 %R 10.2307/146355 %0 Report %D 2000 %T Pensions and Wealth: New Evidence from the Health and Retirement Study %A Khitatrakun, Surachai %A Kitamura, Yuichi %A John Karl Scholz %K Net Worth and Assets %K Pensions %I Dept. of Economics, University of Wisconsin-Madison %G eng %4 Pensions/Wealth %$ 6615 %0 Thesis %D 2000 %T Potential to Privately Pay for Long-Term Care Services %A Dougherty, Deborah D. %K Healthcare %K Net Worth and Assets %X Financing long-term care for the elderly has become an issue of public versus private financing. As proposals to cut public spending are discussed, alternative methods for financing long-term care services need to be introduced. This study addresses the usage of long-term care insurance and reverse mortgages as alternative financing methods. Using the Assets and Health Dynamics of the Oldest-Old, I establish who received long-term care services and how they paid for such services. Next, I examine alternative financing methods to determine which elderly would qualify. Finally, I adjust the criteria of inclusion to increase the beneficiary group of each payment method. I find that both reverse mortgages and long-term care insurance benefit certain groups of individuals. Reverse mortgage beneficiaries included those elderly with large equity in their housing. Using a $30,000 or more home equity, I illustrate that a reverse mortgage would not cover the cost of one year in a nursing home for many elderly. Long-term care insurance, on the other hand, would benefit a majority of elderly individuals, although adjustments need to be made in the insurance market. Individuals with ADL limitations or disease conditions must be allowed to purchase such policies. Insurance premium costs need to be supplemented for those individuals who can not afford them. Individuals between the ages of 80 and 84 must also be considered for insurance policies. My results support the argument that policy discussions concerning long-term care financing should focus on three groups of elderly. Public payers are a group of elderly who rely heavily on Medicaid to cover the costs of their long-term care services. Private payers are those elderly with high incomes and assets who are financially capable of sustaining their long-term care needs. Gappers are those elderly with income and asset levels too high to qualify for Medicaid and too low to pay for their care out-of-pocket. This study indicates that the most beneficiary alternative financing method for gappers is long-term care insurance. The industry is still young, and now is the time to take a stance and make long-term care insurance the solution to financing long-term care. %I Syracuse University %8 2000 %G eng %4 Financial Management %$ 16310 %! Potential to Privately Pay for Long-Term Care Services %0 Report %D 2000 %T Precautionary Saving and the Accumulation of Wealth %A Annamaria Lusardi %K Consumption and Savings %K Expectations %K Net Worth and Assets %X In this paper, I estimate the extent of precautionary accumulation using data from a new survey: the US Health and Retirement Study, which samples older households. I account for many determinants of wealth, not only past economic circumstances and expectations about future resources, but also individual preferences, such as risk aversion and impatience. In addition and most importantly, I account for risk using subjective data on the probability of job loss in the future. I find evidence in favor of precautionary saving. While the precautionary saving motive does not give rise to a lot of wealth, many households make provisions to insure against earnings risk. Thus, precautionary saving continues to affect accumulation even at late stages of the life cycle. %I Dartmouth College %G eng %U https://www.researchgate.net/publication/5091193_Precautionary_Saving_and_the_Accumulation_of_Wealth %L wp_2000/Lusardi_precautionary.pdf %4 Saving/Wealth/Subjective expectations %$ 6605 %0 Journal Article %J The Gerontologist %D 2000 %T Private Long-term Care Insurance and the Asset Protection Motive %A Jennifer M Mellor %K Demographics %K End of life decisions %K Healthcare %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %X This research examined the role of assets in the decision to purchase insurance for long-term care using survey data from the Asset and Health Dynamics Among the Oldest Old (AHEAD) study. Previous research suggests that assets matter, but the size and direction of the effect varies. An important issue regarding the role of assets has not been explored adequately--whether the effect of assets differs between less wealthy and very wealthy individuals. A methodology to control for this type of variation is employed in this analysis. Results suggest that increases in assets have the greatest influence on the probability that less wealthy individuals own long-term care insurance, and have a negligible impact on the wealthy. This has important implications for policies designed to increase long-term care insurance ownership. %B The Gerontologist %I 40 %V 40 %P 596-604 %G eng %N 5 %L pubs_2000_Mellor_JGer.pdf %4 Assets/Decision Making/Health Policy/Insurance, Long Term Care/Economics/Probability/Socioeconomic Factors/Support, U.S. Government--PHS/United States %$ 4115 %R 10.1093/geront/40.5.596 %0 Journal Article %J Applied Economics %D 2000 %T The Production of Functionality by the Elderly: A Household Production Function Approach %A Kutty, Nandinee K. %K Consumption and Savings %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X This paper extends Becker's model of the household production function of human capital to the production of elderly functionality. In this model, elderly functionality is produced with the direct inputs of assistive devices, personal assistance, and nutritional intake. Education, endowment variables (like genetic endowment and sex) and health conditions (like stroke) determine the production function environment. Data from the Survey of Asset and Health Dynamics Among the Oldest-Old (AHEAD) are used to estimate a production function of bathing functionality, using a two-stage estimation procedure. In the first stage, input demands for the endogenous functionality inputs are estimated, recognizing health heterogeneity. The results suggest that reverses in functionality caused by age and health conditions can be partially compensated for by the use of assistive devices (like grab bars and bathing equipment), secure nutritional intake, and moderate alcohol consumption. However, non-inputs like chronic health conditions, age, sex and genetic endowment exert a strong influence on the level of functionality. %B Applied Economics %I 32 %V 32 %P 1269-80 %G eng %N 10 %L pubs_2000_Kutty_NAppEcon.pdf %4 Household Production/Economics of the Elderly/Elderly/Health Status %$ 1030 %R 10.1080/000368400404425 %0 Book Section %B Forecasting Retirement Needs and Retirement Wealth %D 2000 %T Projected Retirement Wealth and Saving Adequacy in the Health and Retirement Study %A James Moore %A Olivia S. Mitchell %E Olivia S. Mitchell %E Hammond, B. %E Rappaport, A. %K Consumption and Savings %K Net Worth and Assets %X 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. %B Forecasting Retirement Needs and Retirement Wealth %I Univ. of Pennsylvania Press %C Philadelphia %P 68-94 %G eng %U https://pensionresearchcouncil.wharton.upenn.edu/publications/books/forecasting-retirement-needs-and-retirement-wealth/ %4 Wealth/Saving/Retirement Wealth %$ 8150 %+ HRS: 1992 %& 3 %0 Book Section %B Forecasting retirement needs and retirement wealth. %D 2000 %T Prospects for Widow Poverty %A David R Weir %A Robert J. Willis %E Olivia S. Mitchell %E P. Brett Hammond %E Anna M. Rappaport %K Consumption and Savings %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %B Forecasting retirement needs and retirement wealth. %S Pension Research Council Publications.: %I University of Pennsylvania Press %C Philadelphia %P 208 -34 %G eng %4 Widowhood/Economics of the Elderly/Economics of Gender/Measurement and Analysis of Poverty/Retirement/Retirement Policies %$ 1062 %! Prospects for Widow Poverty %0 Thesis %D 2000 %T Racial and Ethnic Inequality in Housing Wealth: A Multi-Level Approach %A Chenoa Flippen %K Demographics %K Housing %K Income %K Net Worth and Assets %K Women and Minorities %X That blacks and Hispanics continue to trail whites in wealth, despite significant advances in socioeconomic attainment and decades of anti -discrimination legislation, represents a serious challenge to equal opportunity and a large source of inequality in well-being. Housing wealth is arguably the most important form of assets, comprising the largest share of wealth for most families and providing an important source of wealth generation via appreciation. Understanding why minorities average lower homeownership and housing equity than whites with comparable levels of human capital and financial resources is thus a critical issue for stratification research. My dissertation departs from previous analyses of housing inequality in several ways. First I take a multi-level approach, combining household data from the Health and Retirement Study with neighborhood and metropolitan data from the US Census. Second, I examine housing inequality in a multi-ethnic framework, considering Hispanics in addition to blacks and whites. And finally, I concentrate on the pre-retirement population, which has direct implications for quality of life among the elderly and for wealth transmission across generations. Results demonstrate the negative impact of an important by-product of discrimination, residential segregation, on minority housing. I show that tastes and preferences do not contribute to inequality in housing assets, strongly suggesting the importance of discrimination in undermining minority housing. Subsequently, I show that segregation negatively affects minority housing consumption, depressing both homeownership and housing quality. And finally, I document the negative effect of segregation on the investment aspect of housing. I show that homes in neighborhoods with large or growing minority populations experience lower appreciation than comparable homes in stable and white neighborhoods. Moreover, minority concentration continues to undermine appreciation even after socioeconomic differences across neighborhoods are accounted for. Thus discrimination creates a vicious circle in which minorities are confined to segregated communities with high rates of poverty and poor housing conditions. This engenders supply restrictions detrimental to homeownership and undermines housing appreciation. The resulting inequality in housing wealth detracts from minority well-being and hinders other forms of wealth accumulation. That Hispanic housing is also adversely affected by segregation raises serious concerns for the prospects of Hispanic assimilation. %I The University of Chicago %8 2000 %G eng %U Available from UMI, Ann Arbor, MI. Order No. DA9951782. %4 Black Americans (D083650) %$ 1260 %+ Dissertation Abstracts International, A: The Humanities and Social Sciences; 2000, 60, 12, June, 4619 %! Racial and Ethnic Inequality in Housing Wealth: A Multi-Level Approach %0 Journal Article %J Financial Services Review %D 2000 %T Risk Tolerance and Asset Allocation for Investors Nearing Retirement %A Hariharan, Govind %A Chapman, Kenneth S. %A Domian, Dale L. %K Net Worth and Assets %K Risk Taking %X This paper uses a large individual-level data set to isolate the effects of risk tolerance on portfolio composition. We test and confirm two predictions of the Capital Asset Pricing Model: (1) increased risk tolerance reduces an individual's propensity to purchase risk-free assets; and (2) higher risk tolerance does not affect the composition of an individual's portfolio of risky assets. More specifically, we find that risk tolerant investors nearing retirement do not reduce their bond allocations in order to buy more stock. %B Financial Services Review %I 9 %V 9 %P 159-170 %G eng %N 2 %L pubs_2000_Hariharan_GFinServRev.pdf %4 Portfolio choice/Asset allocation/Risk aversion %$ 11802 %R 10.1016/S1057-0810(00)00063-9 %0 Journal Article %J American Economic Review %D 2000 %T Saver Behavior and 401(k) Retirement Wealth %A James M. Poterba %A Steven F Venti %A David A Wise %K Consumption and Savings %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %K Social Security %X Contributions to 401(k) plans are now the most important form of retirement saving. Since 401(k) plans were introduced in the early 1980's, they have expanded rapidly and continuously. By 1998, roughly half of all households were eligible to participate in 401(k) plans, and more than 36 million workers made contributions to these employer-provided saving plans. In 1995, the last year for which the U.S. Department of Labor has released definitive data, 401(k) contribu- tions amounted to $87.4 billion, or 55 percent of all contributions to employer-sponsored pension plans. The level of contributions, and their share of all pension contributions, is probably signifi- cantly higher today. The spread of 401(k) plans is the most important indicator of the move to personal retirement saving. In 1980, almost 92 percent of pension-plan contributions were to tradi- tional employer-provided plans, and about 64 percent of these contributions were to conventional defined-benefit plans. Today, almost 60 percent of contributions are to personal retirement accounts, including 401(k), IRA, and Keogh plans. Including employer- provided, non-40 1 (k) defined-contribution plans, over 76 percent of contributions are to plans that are controlled in large measure by individuals. These individuals make partici- pation, contribution, asset-allocation, and withdrawal decisions. In this paper, we describe the likely impor- tance of 401(k) assets for future older Ameri- cans and the effect of investment decisions on asset accumulation. We also examine the extent to which retirement assets may be affected by several decisions: preretirement withdrawals, management fees and expenses, contribution rates, and early retirement. Our analysis focuses on 401(k) saving, but applies more broadly to other forms of individual retirement saving. %B American Economic Review %I 90 %V 90 %P 297-302 %G eng %U https://www.jstor.org/stable/117239?seq=1 %N 2 %4 401(k) participation and balances/Retirement Wealth/Consumer Economics/Retirement Policies/Social Security and Public Pensions %$ 8652 %0 Report %D 2000 %T Saving for Retirement: Household Bargaining and Household Net Worth %A Lundberg, Shelly J. %A Jennifer L. Ward-Batts %K Consumption and Savings %K Net Worth and Assets %X Traditional economic models treat the household as a single individual, and do not allow for separate preferences of and possible conflicts of interest between husbands and wives. Since wives are typically younger than their husbands and life expectancy for women exceeds that for men, wives may prefer to save more for retirement than do their husbands. This suggests that households in which wives have greater relative bargaining power may accumulate greater net worth as they approach retirement. Most empirical models of net worth in the literature do not include characteristics of both spouses. We present a more complete unitary model of household net worth and find, among couples in the first wave of the Health and Retirement Survey, that the characteristics of both husband and wife are determinants of net worth. We explore the importance of bargaining in marriages of older couples by examining the empirical relationship between their net worth and factors such as relative control over current income sources, relative age, and relative education. We find some evidence that low relative education of wives is associated with low net worth. %I University of Michigan, Michigan Retirement Research Center %G eng %U https://mrdrc.isr.umich.edu/publications/Papers/pdf/wp004.pdf %L wp_2000/lundberg-batts_mrrc.pdf %4 Saving/Net Worth %$ 6572 %0 Journal Article %J TIAA-CREF Institute Research Dialogue %D 2000 %T Saving for Retirement: The Importance of Planning %A Annamaria Lusardi %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X In this article, I examine saving and planning behavior of households whose head is only a few years away from retirement using data from the Health and Retirement Study (HRS), a survey of a sample of U.S. households in which the head was born between 1931 and 1941. This survey reports detailed information on wealth and the retirement process, with a focus on health, participation in labor markets, and economic and psychosocial factors. These data provide the researcher with an unusually rich set of information to analyze household behavior. I also use data from the Survey of Consumer Finances (SCF), a triennial survey of U.S. families sponsored by the Board of Governors of the Federal Reserve System. This survey is designed to provide detailed information on families' balance sheets and their use of financial services. Finally, in a few instances, data from the 1997 Retirement Confidence Survey are mentioned; this survey collected information on American workers' retirement planning and saving behavior (Yakoboski and Dickemper, 1997). %B TIAA-CREF Institute Research Dialogue %I 66 %V 66 %G eng %U https://www.tiaainstitute.org/sites/default/files/presentations/2017-02/66.pdf %L pubs_2000_Lusardi_issue66.pdf %4 Economic Status--liquid net worth, total net worth/Labor--retirement planning, anxiety/Health Status--cognitive ability/Wealth %$ 8510 %0 Journal Article %J American Sociological Review %D 2000 %T The Significance of Socioeconomic Status in Explaining the Racial Gap in Chronic Health Conditions %A Mark D Hayward %A Eileen M. Crimmins %A Toni Miles %A Yang, Yu %K Health Conditions and Status %K Net Worth and Assets %X Using Wave 1 (1992) and Wave 2 (1994) of the Health and Retirement Study the researchers try to detect the differences in life without health problems between different races so as to understand disparities in mortality rate and quality of life. Do Blacks have a higher risk of acquiring chronic health impairments of all types? How do differences in social conditions produce differences in the prevalence of fatal chronic diseases among races? The researchers notice that Blacks have a lower chance of surviving to middle age then do Whites. Blacks have a far greater level of morbidity in middle age, as well as, chances in having multiple fatal disease conditions. The author s give possible reasons for their findings, with much of it based on social status and life events. %B American Sociological Review %I 65 %V 65 %P 910-930 %G eng %L pubs_2000_Hayward_MASocR.pdf %4 Health Status/Economic Status %$ 8456 %R 10.2307/2657519 %0 Newspaper Article %B Business Week %D 2000 %T To Save or Not To Save %A Coy, Peter %K Consumption and Savings %K Net Worth and Assets %X This article reports on a study conducted by Steven F. Venti and David A. Wise. Using HRS data, they investigated why the personal savings rate in the U.S. is so low. Contrary to the popular explanation of people earning just enough to get by, Venti and Wise found lots of people who earn high incomes but save very little and people with low incomes who manage to save a lot. They argue that this large discrepancy, which exists at all income deciles, is due to the fact that the government is actually discouraging saving by taxing wealth. %B Business Week %P 34 %8 May 8, 2000 %G eng %4 Economic Status/Wealth/Saving %$ 8386 %+ HRS %! To Save or Not To Save %& Economic Trends %0 Thesis %D 2000 %T Wealth Illusion: Theory and Effects on Wealth Accumulation of Defined Contribution Pension Participants %A Zipple, Jeremy %K Net Worth and Assets %K Pensions %I Boston College %8 2000 %G eng %4 Wealth Accumulation %$ 6616 %+ Senior Honors Thesis %! Wealth Illusion: Theory and Effects on Wealth Accumulation of Defined Contribution Pension Participants %0 Newspaper Article %B USA Today Electronic News %D 2000 %T Widow's poverty tied to length of time since husband's death %A Wheeler, Larry %K Net Worth and Assets %B USA Today Electronic News %I USA Today %8 May 22, 2000 %G eng %4 Widowhood %$ 9820 %! Widow's poverty tied to length of time since husband's death %0 Report %D 1999 %T 401(k) Participation, lump-sum distributions, and retirement saving. %A Gary V. Engelhardt %K Adult children %K Consumption and Savings %K Demographics %K Employment and Labor Force %K Net Worth and Assets %X The striking shift toward 401(k)-type pension arrangements has led to concern that many households will have inadequate retirement saving. This could be the case if eligible individuals fail to contribute on a regular basis as well as for eligible individuals with no other pension plans or forms of retirement saving. Since previous studies of 401(k) participation have not been able to measure its determinants, this report examines the determinants of 401(k) participation for a nationally representative sample of pre-retirement aged households. The report also used detailed retrospective information on employment histories, pensions, demographics, and wealth in the Health and Retirement Study (HRS) to examine the disposition of pension assets upon pre -retirement job change. %I Syracuse University %G eng %4 Savings/Households/Employment/Demographics/Investments/Financial management/United States. %$ 1222 %0 Journal Article %J Brookings Papers on Economic Activity %D 1999 %T The Adequacy of Household Saving %A Engen, Eric M. %A William G. Gale %A Cori E. Uccello %K Adult children %K Consumption and Savings %K Event History/Life Cycle %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper shows that, in a life-cycle simulation model in which people save for retirement and due to uncertain future earnings and lifespan, there will be a distribution of optimal wealth-earnings ratios, even among observationally equivalent households. Therefore even low levels of wealth can be consistent with optimization. Using HRS and SCF data, we find that more than half of married households where the husband works full-time have wealth -earnings ratios exceeding the optimal median simulated ratio for households with the same characteristics. The model understates accumulation among households with high wealth-earnings ratios. Both results suggest accumulation is adequate for most such households. However, there is evidence of undersaving at the 5th and the 25th percentiles. We also reconcile most previous studies that have been interpreted as showing inadequate household saving with our results. %B Brookings Papers on Economic Activity %I 2 %V 2 %P 65-165 %G eng %U https://www.brookings.edu/wp-content/uploads/1999/06/1999b_bpea_engen.pdf %L pubs_1999_Engen_etal.pdf %4 Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Macroeconomics: Consumption/Saving/Retirement/Retirement Policies/Personal Income and Wealth Distribution/Distribution/Households/Life Cycle/Retirement/Saving/Wealth %$ 1046 %0 Journal Article %J Social Security Bulletin %D 1999 %T Characteristics of Individuals with Integrated Pensions %A Bender, Keith A. %K Demographics %K Employment and Labor Force %K Methodology %K Net Worth and Assets %X This paper examines the characteristics of individuals covered under integrated pension plans by comparing them with people covered by non-integrated plans and those with no pesion coverage. Females, whites, non-union members, and those workers with less than a postgraduate education are more likely to be covered under integrated pensions. Higher earnings or having a defined benefit pension plan are also strong predictors for having an integrated pension plan. When region and industry type are considered, reults show that workers in the Pacific region and in manufacturing are more likely to be covered by integrated pensions. %B Social Security Bulletin %I 62 %V 62 %P 28-40 %G eng %U https://pdfs.semanticscholar.org/8cdc/a5b6f433be1f56d0135a707c6fd4f5035420.pdf %N 3 %L pubs_2001_Bender_KMonLabRev.pdf %4 Labor/Economic Status/Basic Demographics/Pension Provider Survey %$ 8364 %0 Journal Article %J Journal of Consumer Affairs %D 1999 %T Consumer Preferences for Health Care Reform Options %A Gong-Soog Hong %A Shelley I. White-Means %K Consumption and Savings %K Health Conditions and Status %K Healthcare %K Net Worth and Assets %K Public Policy %X This study uses the 1992 Health and Retirement Study to examine consumer preferences for four health care reform options: tax-financed national health insurance, personally subsidized Medicare extensions, publicly subsidized nursing home insurance, and tax credits for health insurance purchases. Males, non-Caucasians, the self-employed, those in excellent health, and those who reside in the Northeast favor national health insurance, while those with high levels of liquid and non-liquid assets tend to disfavor it. Males and those with higher expectations of living in nursing homes tend to favor personally subsidized Medicare extensions to cover nursing homes and home health care. Those with higher expectations of living in nursing homes also favor publicly subsidized nursing home insurance. Relatively little support for subsidized nursing home insurance is found among males and those with high levels of liquid and non-liquid assets. The self-employed tend to support tax credits for health insurance premiums. %B Journal of Consumer Affairs %I 33 %V 33 %P 237-53 %G eng %U https://www.jstor.org/stable/23859957?seq=1#page_scan_tab_contents %N 2 %L pubs_1999_Hong_GJConsAff.pdf %4 Health Policy/Nursing Homes/Tax Policy/Health Production--Nutrition, Mortality, Morbidity, Disability, and Economic Behavior/Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Net Worth %$ 1002 %0 Journal Article %J Applied Economics %D 1999 %T Demand for Home Modifications: A Household Production Function Approach %A Kutty, Nandinee K. %K Consumption and Savings %K Health Conditions and Status %K Housing %K Net Worth and Assets %X Coping with activity limitations that occur in old age is an important issue in the context of increasing life expectancy and the, still, inevitable onset of chronic conditions in old age. Elderly households can be viewed as coping with activity limitations by producing functionality with the use of direct inputs that include home modifications. A model of the household production of functionality is developed within the general framework of household production function models of health. Hypotheses generated from this model are tested using a logit model for data from the Survey of Asset and Health Dynamics Among the Oldest Old (AHEAD). The main findings of the empirical analysis are that the demand for home modifications is fairly income-inelastic, home modifications and personal care are substitutes to some degree, the demand for home modifications increases with years of schooling, and that particular health conditions and the use of other assistive devices are important determinants of the demand for modifications. %B Applied Economics %I 31 %V 31 %P 1273-81 %G eng %N 10 %L pubs_1999_Kutty_NAppEcon.pdf %4 Household Production/Economics of the Elderly/Health Production--Nutrition, Mortality, Morbidity, Disability, and Economic Behavior/Home Modifications %$ 1032 %R 10.1080/000368499323481 %0 Journal Article %J Financial Services Review %D 1999 %T Does Retirement Planning Affect the Level of Retirement Satisfaction? %A Elder, Harold W. %A Rudolph, Patricia M. %K Adult children %K Demographics %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X This article analyzes the relationship between retirement planning and retirement satisfaction. Planning for retirement is positively related to the level of retirement satisfaction. As expected, individuals with higher incomes, larger net worths, and those who have partners are significantly more likely to be satisfied in retirement. However, even after controlling for these variables, results show that planning does indeed impact the level of retirement satisfaction. Furthermore, planning implies a higher level of satisfaction even for those who did not make the decision to retire voluntarily- - either because of health problems or an employer's decision. %B Financial Services Review %I 8 %V 8 %P 117-27 %G eng %N 2 %L pubs_1999_Elder_HFinSerRev.pdf %4 Labor/Economic Status/Health Status/Family/Basic Demographics %$ 8390 %R 10.1016/S1057-0810(99)00036-0 %0 Magazine Article %D 1999 %T Elder Depression Linked to Disease %A Unattributed %K Demographics %K Disabilities %K Health Conditions and Status %K Net Worth and Assets %X This article describes the findings of a University of Michigan study (based on AHEAD data) that examined the "complex" relationship among depression, disease, and disability. Data from the first two waves of the AHEAD study was used to evaluate the link between disease and depressive symptoms. Results showed that older people who smoked or had multiple symptoms of depression were much more likely to develope a new disease within two years than those without these symptoms. %B Parent Care Advisor %P 1, 8 %8 1999 %G eng %$ 8590 %! Elder Depression Linked to Disease %0 Journal Article %J Labour Economics %D 1999 %T An Empirical Analysis of the Social Security Disability Application, Appeal, and Award Process %A Hugo Benítez-Silva %A Buchinsky, Moshe %A Hiu-Man Chan %A Rust, John %A Sheidvasser, Sofia %K Disabilities %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %K Social Security %X This paper uses the first three waves of the HRS to provide an empirical analysis of the Social Security disability application, award, and appeal process. %B Labour Economics %I 6 %V 6 %P 147-178 %G eng %N 2 %L pubs_1999_Benitez-Silva_HLabEcon.pdf %4 Economic Status/Labor/Health Status/Disability/Disability/Social Security %$ 8304 %R 10.1016/S0927-5371(99)00014-7 %0 Report %D 1999 %T Employer Provided Pension Data in the NLS Mature Women's Survey and in the Health and Retirement Study %A Alan L Gustman %A Thomas L. Steinmeier %K Consumption and Savings %K Employment and Labor Force %K Income %K Methodology %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X We compute pension wealth from employer provided pension plan descriptions matched to respondent surveys to the National Longitudinal Survey of Mature Women (NLS-MW) and the Health and Retirement Study (HRS). These calculations provide detailed information on the level and distribution of pension wealth and a variety of incentives from pensions. Differences between the pensions of men and women are largely explained by differences in earnings. However, there also are differences in the shapes of the pension accrual profiles of defined benefit plans that are likely to reflect tenure of women. Pension coverage is lower in the NLS-MW than in the HRS. As a result, wealth is lower in the NLS-MW than in the HRS. But the difference in coverage is not due to the effects of pension matching. Pension values for covered respondents are similar between the NLS-MW and HRS surveys. Systematic differences between the surveys in the rate at which pensions were matched do not have a major effect on findings as to the levels and distributions of pension wealth between the surveys. %I National Bureau of Economics Research %G eng %4 Personal Income and Wealth Distribution/Economics of the Elderly/Economics of Gender/Retirement/Retirement Policies/Nonwage Labor Costs and Benefits/Private Pensions/Pension Wealth/Pension %$ 1134 %0 Report %D 1999 %T Evidence of Risk Aversion in the Health and Retirement Study %A Bajtelsmit, Vickie L. %K Net Worth and Assets %K Risk Taking %K Women and Minorities %X This study reviews the literature on individual risk aversion and investment allocation. Relative risk aversion is estimated using the 1994 wave of the Health and Retirement Study, a large nationally representative sample of households nearing retirement. After controlling for age, income, dependents, and other demographic characteristics, the results confirm earlier findings of decreasing relative risk aversion. Single women are found to be relatively more risk averse than married couples. Risky portfolio allocation is significantly lower for older households, for those with lower educational levels, and for black households, when housing is not included in the definition of wealth. Examination of the wealth accumulation in this sample of households indicates excessive levels of debt and insufficient savings are common. A smaller sample of individuals completed an experimental component of the survey designed to measure risk aversion with respect to gain or loss of income. The respondents self-professed risk aversion hasa positive impact on risky allocation but the significance level is low. %I Colorado State University %G eng %4 Net Worth/Risk Aversion/Investments/Minorities %$ 6650 %0 Journal Article %J The Journals of Gerontology: Social Sciences %D 1999 %T Formation of Trusts and Spend Down to Medicaid %A Donald H. Taylor Jr. %A Frank A Sloan %A Edward C Norton %K Adult children %K Demographics %K Health Conditions and Status %K Healthcare %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %X OBJECTIVE: To identify the proportion of community-dwelling elderly persons (70 ) who could affect their eligibility for Medicaid financing of a nursing home stay through the use of a trust and to quantify the prevalence and predictors of trusts. METHODS: State-specific Medicaid eligibility regulations were used to determine eligibility and to identify those who could affect the same through the use of trusts. Multivariate logistic regression was used to identify correlates of having a trust. Wave 1 of the Assets and Health Dynamics of the Oldest Old (AHEAD) data base was used. RESULTS: Four in 10 elderly community dwellers could potentially qualify for Medicaid by using a trust; however, less than 10 had a trust. On average, wealthier persons had trusts. Avoidance of probate and controlling assets after death appear to be stronger motivations for trust creation among the elderly than achieving Medicaid spend down. DISCUSSION: The use of trusts was not common, and motives other than spend down were more important for those with trusts. Our results suggest little need for policy efforts to limit the use of trusts to achieve spend down. %B The Journals of Gerontology: Social Sciences %I 54B %V 54B %P S194-201. %G eng %U https://watermark.silverchair.com/54B-4-S194.pdf?token=AQECAHi208BE49Ooan9kkhW_Ercy7Dm3ZL_9Cf3qfKAc485ysgAAArkwggK1BgkqhkiG9w0BBwagggKmMIICogIBADCCApsGCSqGSIb3DQEHATAeBglghkgBZQMEAS4wEQQMp0UUg1PuPyPtW2TQAgEQgIICbKvSCKf7gEQSGvy-WxqpuojGLR3OKgcObNMZ3E6gB4hR %N 4 %L pubs_1999_Taylor_FJGSeriesB.pdf %4 Aged, 80 and Over/Assets/Eligibility Determination/Financing, Personal/Homes for the Aged/Intergenerational Transfers/Medicaid/Nursing Homes/Support, U.S. Government--PHS/United States %$ 4320 %0 Journal Article %J The Urban Institute %D 1999 %T The Gender Gap in Pension Wealth: Is Women's Progress in the Labor Market Equalizing Retirement Benefits? %A Richard W. Johnson %K Demographics %K Employment and Labor Force %K Net Worth and Assets %K Women and Minorities %B The Urban Institute %I The Retirement Project Brief Series %V The Retirement Project Brief Series %G eng %U https://www.urban.org/sites/default/files/publication/69736/310238-The-Gender-Gap-in-Pension-Wealth.PDF %N No. 1 %4 Pension Wealth/Gender/Women/Labor Force %$ 8668 %0 Magazine Article %D 1999 %T Illness and Economic Status: Why are they so closely connected? %A Koretz, Gene %K Health Conditions and Status %K Net Worth and Assets %B Business Week %P 34 %8 June 14, 1999 %G eng %4 Economic Status/Health Status %$ 8326 %! Illness and Economic Status: Why are they so closely connected? %0 Book Section %B Wealth, work, and health: Innovations in measurement in the social sciences: Essays in honor of F. Thomas Juster %D 1999 %T Lifetime Earnings, Saving Choices, and Wealth at Retirement %A Steven F Venti %A David A Wise %E James P Smith %E Robert J. Willis %K Consumption and Savings %K Event History/Life Cycle %K Methodology %K Net Worth and Assets %K Retirement Planning and Satisfaction %B Wealth, work, and health: Innovations in measurement in the social sciences: Essays in honor of F. Thomas Juster %I University of Michigan Press %C Ann Arbor, MI %P 87-120. %G eng %4 Retirement Planning/Retirement Behavior/Savings/Wealth/Microeconomic Data Management/Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Intertemporal Consumer/Life Cycle Models and Saving/Retirement/Retirement Policies %$ 1052 %! Lifetime Earnings, Saving Choices, and Wealth at Retirement %0 Book Section %B Wealth, Work and Health: Innovations in Measurement in the Social Sciences %D 1999 %T Pension and Social Security Wealth in the Health and Retirement Study %A Alan L Gustman %A Olivia S. Mitchell %A Andrew A. Samwick %A Thomas L. Steinmeier %E James P Smith %E Robert J. Willis %K Net Worth and Assets %K Pensions %K Social Security %X 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. %B Wealth, Work and Health: Innovations in Measurement in the Social Sciences %I University of Michigan Press %C Ann Arbor, MI %P 150-208 %G eng %4 Pensions/Social Security/Wealth %$ 8198 %+ HRS: 1992 %! Pension and Social Security Wealth in the Health and Retirement Study %0 Journal Article %J Industrial Relations %D 1999 %T Pension Type and Retirement Wealth %A Blank, Emily C. %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X Throughout the 1980s and 1990s there has been a gradual shift from defined-benefit pensions, where an individual obtains a specified amount of retirement income, to defined-contribution pensions, where only the annual contribution by the employer is specified. In this article the author hypothesizes that defined-contribution plans have a greater probability than defined-benefit plans of leaving a retired person with inadequate expected retirement income. Wave 1 (1992) of the Health and Retirement Study is used for the data that is input into the author s retirement wealth equation where retirement wealth is positive and a function of job tenure, age, sex, race, investment portfolio, and whether or not the individual was born in the U.S. The analysis gives some support for defined-benefit pensions being more affective, however this is true only for those still working. At the same time, so long as there is a cautious mix of stocks and bonds, the data clearly indicates that defined-contribution plans are beneficial to retired individuals. Also recognized by this study is that those people with the highest educations collect the most retirement benefits, keeping earnings constant. %B Industrial Relations %I 38 %V 38 %P 1-10 %G eng %N 1 %L pubs_1999_Blank_EIndRel.pdf %4 Pension/Wealth/Retirement %$ 8342 %0 Report %D 1999 %T Racial and Ethnic Differences in Wealth Among the Elderly %A Chenoa Flippen %A Tienda, Marta %K Demographics %K Net Worth and Assets %I University of Chicago Population Research Center %G eng %4 Wealth/Racial Differences/Ethnic Groups %$ 6557 %0 Journal Article %J The Gerontologist %D 1999 %T Retirement Patterns and Employee Benefits: Do Benefits Matter? %A Fronstin, Paul %K Employment and Labor Force %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X This article investigates the impact of postretirement employee benefits on the likelihood that workers expect to retire before age 62 and age 65. Using data from the 1992 Health and Retirement Study, probit regression models were estimated to explore the effect of pension plans and retiree health insurance on the expectation of early retirement. With respect to pension plans, the effects of both the type of pension plan and the expected benefits from those plans are explored. Similar effects were explored for retiree health benefits. The results indicate that postretirement pension benefits and the availability of retiree health benefits have a significant influence on workers' retirement age expectations. %B The Gerontologist %I Vol. 39 %V 39 %P 37-47 %G eng %N 1 %L pubs_1999_Fronstin_PGer.pdf %4 Labor Force/Economic Status/Retirement Behavior/Benefit Formulas %$ 8294 %R 10.1093/geront/39.1.37 %0 Journal Article %J Labour Economics %D 1999 %T Theory Confronts Data: How the HRS is Shaped by the Economics of Aging and How the Economics of Aging Will be Shaped by the HRS %A Robert J. Willis %K Health Conditions and Status %K Methodology %K Net Worth and Assets %X This paper describes the evolution of the HRS from its origins in 1992 to its current design as a longitudinal 'steady state' sample of older Americans which is representative of the U.S. population over age 50. It discusses the conceptual framework of the survey as well as the broad theoretical concepts that lead to its content and design. The paper concludes with a description of some recent findings that use the HRS data; in particular the positive correlation between health and wealth. %B Labour Economics %I 6 %V 6 %P 119-145 %G eng %N 2 %L pubs_1999_Willis_RLabEcon.pdf %4 HRS content and design/Longitudinal Studies/Economic Status/Health Status %$ 8302 %R 10.1016/S0927-5371(99)00011-1 %0 Journal Article %J The Gerontologist %D 1999 %T The Transfer of Resources from Middle-Aged Children to Functionally Limited Elderly Parents: Providing Time, Giving Money, Sharing Space %A Boaz, Rachel F. %A Hu, Jason %A Ye, Yongjia %K Adult children %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X This article investigates the interdependence among all three major modes of trasfer (giving time, money, and sharing space), given the parents' specific needs for resources and the children's ability to provide them. While only reported in 17 of the households, the provision of caregiving time is the primary mode of resource transfer from children to their parents. When the other modes of transfers are added, money and space, the percentage of households transfering resources to their parents rose to 29 . It is significant to consider all modes of transfer in order to understand how families accomodate the needs of elderly/disabeled parents. These transfer modes appear to be dependent upon the needs and situations of the parents as well as the types of resources available to the household that is giving. %B The Gerontologist %I 39 %V 39 %P 648-657 %G eng %N 6 %L pubs_1999_Boaz_RGer.pdf %4 Family/Labor/Economic Status/Health/Transfers %$ 8358 %R 10.1093/geront/39.6.648 %0 Book Section %B Wealth, Work, and Health: Innovations in Measurement in the Social Sciences: Essays in honor of F. Thomas Juster. %D 1999 %T Unfolding Bracket Method in the Measurement of Expenditures and Wealth %A Daniel H. Hill %E James P Smith %E Robert J. Willis %K Consumption and Savings %K Methodology %K Net Worth and Assets %B Wealth, Work, and Health: Innovations in Measurement in the Social Sciences: Essays in honor of F. Thomas Juster. %I University of Michigan Press %C Ann Arbor, MI %P 64-86 %G eng %U https://books.google.com/books?id=lKvp4D1HuH8C&pg=PA64&lpg=PA64&dq=Unfolding+Bracket+Method+in+the+Measurement+of+Expenditures+and+Wealth&source=bl&ots=hFIAdSfSt6&sig=ACfU3U2f2HvZoq6nQLadPt_pPaidMEBcyQ&hl=en&sa=X&ved=2ahUKEwjAruG52p3qAhWIZM0KHTMiBpAQ6AEwA %4 Microeconomic Data Management/Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Expenditure/Wealth/Data Collection and Data Estimation Methodology %$ 1000 %! Unfolding Bracket Method in the Measurement of Expenditures and Wealth %0 Report %D 1999 %T Wealth Accumulation in the Health and Retirement Study: The Importance of Including Pension Wealth %A Cori E. Uccello %A Perese, Kevin %K Net Worth and Assets %K Retirement Planning and Satisfaction %I The Urban Institute %G eng %4 Pension Wealth/Retirement %$ 6594 %0 Journal Article %J American Economic Review %D 1998 %T 401(k) Plans and future patterns of retirement saving %A James M. Poterba %A Steven F Venti %A David A Wise %K Employment and Labor Force %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %X This paper summarizes current participation and contribution patterns in 401(k) plans and projects 401(k) balances at retirement age for workers currently between the ages of 30 and 40. The various factors that will influence future 401(k) balances are discussed. The projections based on HRS data suggest that 401(k) plans are likely to play a significant role in providing for the retirement income of future retirees. %B American Economic Review %I 88 %V 88 %P 179-184 %G eng %U https://www.jstor.org/stable/116915?seq=1 %N 2 %L pubs_1998_Poterba_JAER.pdf %4 Economic Status--net worth, earnings history/Labor/401(k) participation and balances/Retirement Planning %$ 8274 %0 Journal Article %J Journal of Risk and Insurance %D 1998 %T Can Americans Afford to Retire? New Evidence on Retirement Saving Adequacy %A Olivia S. Mitchell %A James Moore %K Net Worth and Assets %K Retirement Planning and Satisfaction %X 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. %B Journal of Risk and Insurance %I 65 %V 65 %P 371-400 %G eng %U 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 %N 3 %4 Economic Status--wealth/Retirement Wealth/Retirement Planning %$ 8122 %0 Journal Article %J American Economic Review %D 1998 %T The Cause of Wealth Dispersion at Retirement: Choice or Chance? %A Steven F Venti %A David A Wise %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %B American Economic Review %I 88 %V 88 %P 185-91 %G eng %U https://www.jstor.org/stable/116916?seq=1 %N 2 %L pubs_1998_Venti_SAER.pdf %4 Personal Income and Wealth Distribution/Retirement/Retirement Policies/Retirement/Wealth %$ 1054 %0 Journal Article %J American Journal of Industrial Medicine %D 1998 %T Comparison of Health Outcomes Among Older Construction and Blue-Collar Employees in the United States %A Petersen, Jeffrey S. %A Zwerling, Craig %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X This article examines health outcomes of older male construction workers (age 51-61), as compared with older male blue-collar workers of the same age range. Results show that older construction workers are significantly more susceptible to musculoskeletal problems, emotional disorders, and chronic lung disease (CLD). This high rate of CLD, non-smoking construction workers are three times more likely to have CLD than are non-smoking blue-collar workers, is most likely due to on-the-job dust exposure. These findings suggest the need for further research on these topics and on possible solutions to these problems. %B American Journal of Industrial Medicine %I Vol. 34 %V Vol. 34 %P 280-287 %G eng %N 3 %4 Health Status/Labor/Economic Status/Job Characteristics %$ 8270 %R 10.1002/(SICI)1097-0274(199809)34:3<280::AID-AJIM11>3.0.CO;2-Q %0 Book Section %B Living With Defined Contribution Pensions %D 1998 %T Effects of Pensions on Household Wealth Accumulation: Implications of the Shift Toward Defined Contribution Plans %A William G. Gale %A Milano, Joseph %E Olivia S. Mitchell %E Scheiber, S. %K Net Worth and Assets %K Pensions %X 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. %B Living With Defined Contribution Pensions %I Univ. of Pennsylvania Press and Pension Research Council %G eng %U https://pensionresearchcouncil.wharton.upenn.edu/wp-content/uploads/2015/09/0-8122-3439-1-6.pdf %4 401(k) participation and balances/Wealth Accumulation %$ 8142 %! Effects of Pensions on Household Wealth Accumulation: Implications of the Shift Toward Defined Contribution Plans %0 Report %D 1998 %T Effects of Pensions on Savings: Analysis with Data from the Health and Retirement Study %A Alan L Gustman %A Thomas L. Steinmeier %K Adult children %K Consumption and Savings %K Employment and Labor Force %K Income %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %K Social Security %X This paper examines the composition and distribution of total wealth for a cohort of 51- to 61-year olds from the Health and Retirement Study (HRS), and the role of pensions in forming retirement wealth. Pension coverage is widespread, covering two-thirds of households and accounting for one-quarter of accumulated wealth. Social security benefits account for another quarter of total wealth. As calculated from earnings records, the present discounted value of social security benefits is less than the present value of taxes paid. Earlier than many expected, social security is already a poor investment on average for this cohort on the verge of retirement. When pensions and social security are included, wealth accumulated by the HRS population to date is substantial. At their expected retirement date, using only the wealth accumulated by their mid-fifties, the HRS household with median replacement rate could finance a fixed, nominal two-thirds joint and survivor annuity replacing 79 percent of last earnings, and a real annuity replacing 52 percent of last earnings. Replacement rates for median earners are higher. Additional savings made over the seven years remaining until retirement will raise those replacement rates by about a fifth. When measured against a standard of adequacy based on average yearly earnings over the worklife, with adjustments made for the absence of preretirement savings, children, taxes, work-related expenses and other factors, these replacement rates appear adequate. Lifetime earnings are measured for each individual in the HRS from social security earnings records augmented by self-reported earnings histories. When pensions and social security are counted in total wealth, the ratio of wealth to lifetime earnings declines from very high levels in the bottom ten percent of the earnings distribution, remains at roughly 40 percent from the 25th through 95th percentile of the lifetime earnings distribution, and then falls to 32 percent for those in the top five percent of the earnings distribution. This result is consistent with the predictions of a simple, stripped-down life-cycle model. Also consistent is a finding that the ratio of wealth to lifetime earnings is no higher for those with pensions than for those without pensions. However, heterogeneity is quite important. Real estate and business wealth are a larger share of total wealth for those without pensions, reflecting the importance of self-employment in wealth accumulation. Multivariate regressions relating total wealth to pension coverage and pension value, which standardize for sources of heterogeneity, suggest that pensions cause very limited displacement of other wealth, if any. Pensions add to total wealth by at least half the value of the pension, and in most estimates by a good deal more. These findings are not consistent with a simple life-cycle explanation for savings. They also raise questions about whether pensions are fundamentally a tax avoidance device, allowing substitution of pension for nonpension savings. %B NBER Working Paper %I NBER %C Cambridge %G eng %U https://www.nber.org/papers/w6681.pdf %4 Personal Income and Wealth Distribution/Retirement/Retirement Policies/Social Security and Public Pensions/Nonwage Labor/Private Pensions/Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Distribution/Households/Pension/Retirement/Saving/Social Security/Wealth %$ 1184 %0 Report %D 1998 %T Family Structure and Economic Well-Being of Black, Hispanic, and White Pre-Retirement Adults %A Chenoa Flippen %A Tienda, Marta %K Adult children %K Net Worth and Assets %K Women and Minorities %X This paper examines how family structure is related to racial and ethnic inequality among older populations. We show that intergenerational living serves the economic needs of minority and unmarried female elders more than non-minority and married elders. The greater economic motivation for co-residence among minority and female elders was suggested both by their higher reliance on the income of co-resident kin and by their subjective evaluations of who benefited most from co-residence. However, when the contributions of co-resident kin are weighed against the additional costs they bring to the household, the inequality-reducing effect of extension falls considerably. The contributions per co-resident kin are smaller in minority households, and thus the economic well-being of elders living in extended households is often no better, and occasionally worse, than had they lived alone. Only unmarried women receive a substantial net boost from co-residence, primarily because adult offspring who co-reside with unmarried women contribute more than their counterparts in unmarried male or couple households. %B Office of Population Research working paper %I Princeton University %C Princeton %G eng %U https://ideas.repec.org/p/pri/opopre/opr9802.pdf.html %4 Family Structure/Economic Status/Black Americans/Hispanic Americans %$ 6652 %0 Journal Article %J Journal of Labor Economics %D 1998 %T Health and Labor Market Performance: The Case of Diabetes %A Kahn, Matthew E. %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X This article documents improvements in diabetic labor market performance. Three cross-sectional data sets, from 1976, 1989, and 1992, are used to study trends in diabetic employment and earnings prospects. Results show that the labor force participation of diabetic women has significantly increased between 1976 and 1992, relative to diabetic men and nondiabetics. Results also indicate that relative to nondiabetic family heads of households, the income of the diabetic family has increased. These findings suggest that medical advance and technological change have helped to reduce the probability and effects of diabetic complications. %B Journal of Labor Economics %I 16 %V 16 %P 878-899 %G eng %N 4 %L pubs_1998_Kahn_MJoLE.pdf %4 Diabetic Status/Health Status/Economic Status/Labor Market %$ 8254 %R 10.1086/209909 %0 Book Section %B Inquiries in the economics of aging %D 1998 %T Household Wealth of the Elderly under Alternative Imputation Procedures %A Hoynes, Hilary %A Michael D Hurd %A Chand, Harish %E David A Wise %K Consumption and Savings %K Demographics %K Income %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Although many reach retirement with few resources except housing equity and a claim to social security and Medicare, financial wealth, nonetheless, makes an important contribution to the economic status of many of the elderly. Most of our up-to-date information about the wealth of the elderly is based on the Survey of Income and Program Participation (SIPP), which sometimes adds an asset module to its core survey. As in many surveys of assets, the rate of missing data on individual asset items is high, about 30 to 40 percent among those with the asset. This raises the issue of the reliability of SIPP wealth measures because respondents who refuse or are unable to give a value to an asset item may not be representative of the population. Indeed, in the Health and Retirement Survey (HRS) it is clear that asset data are not missing at random. Through the use of bracketing methods, which we will discuss below, the HRS was able to reduce the rate of missing asset data substantially, and the data that were added in this way increased mean wealth in the HRS by about 40 percent (Smith 1995). Furthermore, because the additional data increased the mean so much, they undoubtedly increased measures of wealth inequality. %B Inquiries in the economics of aging %I University of Chicago Press %C Chicago and London %P 229 -54 %G eng %U https://www.nber.org/chapters/c7088 %N NBER Project Report series %4 Economics of the Elderly/Retirement/Retirement Policies/Personal Income and Wealth Distribution/Elderly/Wealth %$ 1008 %! Household Wealth of the Elderly under Alternative Imputation Procedures %0 Report %D 1998 %T How America Saves %A Korczyk, Sophie %K Adult children %K Employment and Labor Force %K Expectations %K Health Conditions and Status %K Net Worth and Assets %K Risk Taking %X Certain groups with lower savings througout their work lives reach retirement with significantly fewer assets than their peers. Single people, African American and Hispanic households, those with a high school education or less, people with health problems, and lower income households are all vulnerable to lower savings. Even though people save more as they age, age does not make up for low saving patterns. In nearly all economic and demographic groups, there are some people who do not save at all, some who save a little, and some who save a great deal. Taking into consideration the experiences, attitudes, and personal expectations of people nearing or in the early stages of retirement age is important to understanding their saving capacities, patterns, and decisions. %I Washington, DC, American Association of Retired Persons %G eng %4 Economic Status/Family/Labor/Health Status/Attitudes towards Saving and the Future/Opinions about the Economy %$ 8166 %0 Report %D 1998 %T How Important are Intergenerational Transfers of Time? A Macroeconomic Analysis %A Emanuela Cardia %A Serena Ng %K Adult children %K Employment and Labor Force %K Net Worth and Assets %X In this article the authors consider labor supply and capital accumulation with respect to intergenerational transfers of both time and money. Researchers working on this study created a model that would permit variables for time and monetary transfers, between generations of a family, in order to observe possible effects on the economy. By way of the model and data from the first wave (1992) of the Health and Retirement Study the researchers are able to find that increases in the amount of time transferred between generations will increase the amount of capital accumulation. The authors feel that time transfers have just as large an effect on the economy as monetary transfers. Monetary transfers have a tendency to increase a persons wealth and thus decrease the amount of effort they put into their work. On the other hand, time transfers tend to increase the amount of young people that are in the labor force. The authors examine the effects of different types of tax credits, as well. %I Boston College %G eng %4 Labor Supply/Transfers/Wealth %$ 6551 %0 Report %D 1998 %T The Impact of Pay Inequality, Occupational Segregation, and Lifetime Work Experience on Retirement Income of Women and Minorities %A Olivia S. Mitchell %A Phillip B. Levine %A John W R Phillips %K Demographics %K Housing %K Income %K Net Worth and Assets %K Pensions %K Social Security %K Women and Minorities %X 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. %G eng %4 Earnings and Benefits File/Social Security and Public Pensions/Pensions/Retirement Incomes/Assets/Housing Equity/Female/Minorities/Whites %$ 6556 %0 Journal Article %J Journal of Vocational Behavior %D 1998 %T The Influence of Push and Pull Factors on Voluntary and Involuntary Early Retirees' Retirement Decision and Adjustment %A Kenneth S. Shultz %A Morton, Kelly R. %A Weckerle, Joelle R. %K Adult children %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This paper examines early retirees' decisions to retire, as well as their postretirement adjustment, in terms of both push (negative considerations: e.g., poor health) and pull (positive considerations: e.g., leisure interests) factors. Results confirm the hypothesis that both negative push and positive pull factors differentially influenced those retirees who voluntarily retired and those forced to retire. After retirement, the negative push factors became the more salient differentiators; those forced to retire appeared to have generally lower self ratings of physical and emotional health and lower satisfaction rates. In addition, the findings suggest that the way an individual views their retirement decision is related to their postretirement experience: those who viewed their retirement decision as voluntary reported higher satisfaction and health levels during retirement than those who viewed their retirement as involuntary. %B Journal of Vocational Behavior %I 53 %V 53 %P 45-57 %G eng %N 1 %4 Retirement Planning/Health Status/Desire for Leisure/Family Time/Economic Status/Retirement Behavior/Satisfaction %$ 8224 %0 Book Section %B Frontiers in the Economics of Aging %D 1998 %T Pensions and the Distribution of Wealth %A Kathleen McGarry %A Davenport, Andrew %E David A Wise %K Net Worth and Assets %B Frontiers in the Economics of Aging %I University of Chicago Press %C Chicago, IL %G eng %4 Pension Wealth %$ 8246 %! Pensions and the Distribution of Wealth %0 Journal Article %J GAO Testimony before the Special Committee on Aging, U.S. Senate %D 1998 %T Social Security Reform: Raising Retirement Ages Improves Program Solvency but May Cause Hardship for Some %A Bovbjerg, Barbara D. %K Demographics %K Disabilities %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %K Social Security %X This report examines how raising the retirement age could affect Social Security (SS) and the economy and how the labor market might respond to these changes. It then looks at the possible impacts this raising of the age would have on the Disability Insurance (DI) and Supplemental Security Income (SSI) programs. The analysis shows that due to high life expectancies and the overall good health condition of the elderly, raising the retirement age could improve SS program's long-term solvency and could increase economic output. However, potential negative effects arise from the fact that older workers who have been laid off or have been retired may experience difficulties finding jobs. While the elderly may be willing to continue working, it is questionable whether employers will be willing to retain and hire them. Another possible drawback to raising the retirement age is explained by using the Health and Retirement Study. HRS data demonstrated that blue-collar workers in particular would be disproportionately affected by this age increase because due to the nature of their jobs which puts them at an increased risk of incurring health problems, they may be unable to remain in the workforce in later ages. These poor health, predominately blue-collar workers who will not receive SS retirement benefits because they cannot continue working up until the new age set by the increase, may apply for DI or be eligible for SSI, which would increase the costs of those programs. %B GAO Testimony before the Special Committee on Aging, U.S. Senate %I GAO/T-HEHS-98-207 %V GAO/T-HEHS-98-207 %G eng %N July %4 Labor Force/Health Status/Basic Demographics/Economic Status/Disability/Disability/Social Security %$ 8230 %0 Journal Article %J Australasian Journal on Ageing %D 1998 %T Symposium on Work, Retirement and Wealth: Current Data and Future Needs: An International Perspective %A R.V. Burkhauser %A Robert Clark %A Richard M. Suzman %K Demographics %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %X Discusses a cross-national symposium on elderly work, retirement, and wealth that drew on the US Health and Retirement Study and Panel Study of Income Dynamics, the Netherlands Household Panel Study, the German Socioeconomic Panel, and several East and Southeast Asian datasets. %B Australasian Journal on Ageing %I 17 %V 17 %P supplement, 11-13 %G eng %N 1 %4 Elderly/Work/Employment/Retirement/Wealth %$ 1274 %0 Journal Article %J The Journals of Gerontology, Series B: Psychological Sciences and Social Sciences %D 1997 %T Asset and Health Dynamics Among the Oldest Old: An overview of the AHEAD Study %A Beth J Soldo %A Michael D Hurd %A Willard L Rodgers %A Robert B Wallace %K Adult children %K Demographics %K Health Conditions and Status %K Healthcare %K Income %K Methodology %K Net Worth and Assets %X This article contains background information on the study of Asset and Health Dynamics Among the Oldest Old (AHEAD), a prospective panel survey of persons born in 1923 or earlier who were residing in the community at the time of the 1993 baseline. Interviews were sought with both spouses in married households, and an overall total of 8,222 were completed. We review the interdisciplinary scientific issues that motivated the study, describe the fundamental design decisions that structured AHEAD, and summarize the content in the core and experimental modules. The study provides unusually detailed data on cognition, family structure and transfers, and assets. Data are presented on sample selections, response rates, and oversamples of minority groups. Basic descriptive data on the demographic, health, and socioeconomic attributes of respondents also are presented. Plans for future waves of AHEAD are described, including a next-of-kin interview for decreased respondents. %B The Journals of Gerontology, Series B: Psychological Sciences and Social Sciences %I 52B %V 52B %P 1-20 %G eng %N Spec %L pubs_1997_Soldo_BJGSeriesB.pdf %4 HRS content and design/Aged, 80 and Over/Family/Female/Financing, Personal/Health Services/Utilization/Health Status/Income/Longitudinal Studies/Support, U.S. Government--PHS/United States %$ 4205 %0 Report %D 1997 %T The Changing Economic Circumstances of the Elderly: Income, Wealth and Social Security %A James P Smith %K Health Conditions and Status %K Income %K Net Worth and Assets %K Social Security %X This Policy Brief looks at how the economic status of the elderly is changing and discusses their prospects for the future. While the economic status of the elderly has dramatically improved over the decades and there is evidence of modest wealth holdings by the typical older household, there still exists the reality of economic disparities. Many older Americans remain economically vulnerable and there are large inequalities in wealth. Wide disparities exist across racial and ethnic groups and across age groups, with the oldest households always faring worst, largely due to deaths of spouses. Evidence suggests that while income explains a significant part of the existing wealth disparities, it is not the sole factor. The other contributing factors are the significantly lower savings rates for low- and middle-income households, socioeconomic status and health, bequests motives, and Social Security. The brief ends with a discussion about the power of Social Security as a highly successful redistributive system and the reasons behind its need for reform. %I Syracuse University %G eng %U https://ideas.repec.org/p/max/cprpbr/008.html %4 Economic Status/Wealth/Retirement Incomes/Income Inequality/Social Security/Health Status %$ 8126 %0 Report %D 1997 %T Do Parents Divide Resources Equally Among Children? Evidence from the AHEAD Survey %A Dunn, Thomas A. %A John W R Phillips %K Adult children %K Net Worth and Assets %I Syracuse University %G eng %4 Transfers/Wealth/Family transfers, structure %$ 6536 %0 Book Section %B The Economic Effects of Aging in the United States and Japan %D 1997 %T The Impact of Demographics on Housing and Nonhousing Wealth in the United States %A Daniel McFadden %A Hoynes, Hilary %E Naohiro Yashiro %E Michael D Hurd %K Demographics %K Housing %K Net Worth and Assets %B The Economic Effects of Aging in the United States and Japan %I University of Chicago Press %C Chicago, IL %P 153-194 %G eng %4 Housing Equity/Wealth/Demographics %$ 8264 %! The Impact of Demographics on Housing and Nonhousing Wealth in the United States %0 Journal Article %J Proceedings of the American Statistical Association %D 1997 %T Imputation of Multivariate Data on Household Net Worth %A Steven G Heeringa %A Roderick J.A. Little %A Trivellore E. Raghunathan %K Methodology %K Net Worth and Assets %X This paper analyzes the various methods involved in the imputation of multivariate data. The paper investigates methods of imputing amounts for bracketed net worth variables; empirically compares the distributional properties of data imputed by the alternative methods; and estimates the imputation variance that each method adds to the completed data set. %B Proceedings of the American Statistical Association %I Section on Survey Research Methods %V Section on Survey Research Methods %P 135-140 %G eng %U http://www.asasrms.org/Proceedings/papers/1997_020.pdf %L pubs_1997_Heeringa_etal_ASA.doc %4 Microeconomic Data Management/Economic Status/Method of Response used to answer question %$ 8242 %0 Journal Article %J Social Security Bulletin %D 1997 %T Life-Cycle Aspects of Poverty Among Older Women %A Choudhury, Sharmila %A Leonesio, Michael V. %K Net Worth and Assets %K Women and Minorities %B Social Security Bulletin %I 60 %V 60 %G eng %U https://www.ssa.gov/policy/docs/ssb/v60n2/v60n2p17.pdf %N 2 %L pubs_1997_Choudhury_SSSB.pdf %4 Women/Economic Status %$ 8106 %0 Report %D 1997 %T Pension and Social Security Wealth in the Health and Retirement Study %A Alan L Gustman %A Olivia S. Mitchell %A Andrew A. Samwick %A Thomas L. Steinmeier %K Consumption and Savings %K Income %K Medicare/Medicaid/Health Insurance %K Methodology %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %K Social Security %X 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. %I National Bureau of Economic Research %G eng %U https://www.nber.org/papers/w5912 %4 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 %$ 1192 %R 10.3386/w5912 %0 Report %D 1997 %T Projected Retirement Wealth and Savings Adequacy in the Health and Retirement Study %A James Moore %A Olivia S. Mitchell %K Consumption and Savings %K Health Conditions and Status %K Net Worth and Assets %K Pensions %K Retirement Planning and Satisfaction %K Social Security %X 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. %I National Bureau of Economic Research %G eng %U https://www.nber.org/papers/w6240 %4 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 %$ 1160 %R 10.3386/w6240 %0 Journal Article %J Aging and Mental Health %D 1997 %T Protecting Persons With Severe Cognitive and Mental Disorders: An Analysis of Public Conservatorship in Los Angeles County, California %A Sandra L Reynolds %A Kathleen H. Wilber %K Health Conditions and Status %K Net Worth and Assets %K Public Policy %X This article begins to identify the factors that place older adults at risk for conservatorship. Comaprisons are drawn between the characteristics of adult public conservatees in the civil commitment and Probate programs in Los Angeles, between young and old conservatees, and then between old conservatees and adults nationwide who are part of the AHEAD sample. Findings show obvious differences between the two types of conservatees. Individuals in the Probate program have the characteristics of young conservatees while adults in the civil commitment program have the characteristics of older conservatees and have less available family memebers, implying social isolation as a risk factor for older adults for public conservatorship. Compared to older adults nationwide, older public conservatees (70 and older) are much older, more likely to suffer from dementia, to be physically impaired, and are far less affluent. This comparison suggests that older adults in public conservatorship in Los Angeles appear to reflect the correct target population for such a service, socially isolated and highly impaired adults. %B Aging and Mental Health %I Vol. 1 %V Vol. 1 %P 87-97 %G eng %4 Health Status/Economic Status/Cognition/Public Policy %$ 8250 %R https://doi.org/10.1080/13607869757425 %0 Journal Article %J The Public Policy and Aging Report %D 1997 %T Retirement Trends and Patterns in the 1990s: The End of an Era? %A Joseph F. Quinn %K Employment and Labor Force %K Net Worth and Assets %K Retirement Planning and Satisfaction %X This article documents the dramatic change in retirement trends of the mid-1980's, mentions some of the contributing factors that may have lead to the change, and discusses some preliminary research on the nature of retirement patterns in the 1990's. Results show that both older men and women are working much more now than the pre-1985 retirement trends would have predicted. HRS data emphasizes that retirement patterns in America are varied and confirms the importance of gradual retirement, especially bridge jobs, to the retirement process of the 1990s. %B The Public Policy and Aging Report %I 8 %V 8 %P 10-14 %G eng %N 3 %L pubs_1996_Quinn_JGer.pdf %4 Economic Status/Labor Force Participation/Retirement Planning/Bridge Jobs %$ 8128 %0 Report %D 1997 %T Social Security Reform: Implications for Women's Retirement Income %A Cackley, Alicia Puente %K Adult children %K Demographics %K Net Worth and Assets %K Social Security %K Women and Minorities %X This report examines why women's benefits are lower than men's under the current Social Security system and evaluates the possible differential effects of the new privatization reform proposals on women. Average SS benefits are currently lower for women because of their lower rates of labor force participation and lower earning levels- both factors that contribute to the calculation of benefits. The reform proposals that would most affect women differently than men are the ones that create individual private savings accounts and change the way benefits would be distributed from those accounts. Because women earn less than men on average and are less likely to engage in risky high yielding assets, they would have less to invest and most likely would accumulate relatively less. Although differences in labor force participation and earnings between genders are expected to be reduced, they will not disappear. Therefore, any reform that bases benefits on earnings will continue to benefit men more than women. A system that relied mostly on individual investments would allow women workers a chance to increase their retirement benefits. %I Washington, DC, United States General Accounting Office %G eng %U http://www.gao.gov (pdf file) %4 Economic Status/Family/Basic Demographics/Social Security/Women %$ 8170 %0 Journal Article %J The Journals of Gerontology, Series B: Psychological Sciences and Social Sciences %D 1997 %T Wealth Inequality Among Older Americans %A James P Smith %K Health Conditions and Status %K Income %K Net Worth and Assets %X This article uses the AHEAD study to examine the distribution of wealth among American households with a member at least 70 years old. As in other age groups, wealth is unevenly distributed among Americans aged 70 years and older. The households in the top 10th percentile of wealth distribution have 2,500 times as much wealth as those in the lowest 10th percentile. This wealth inequality is reflected in large racial and ethnic wealth deficits. Such wealth disparities, largely due to income, are the primary reason why older minority households have accumulated so little wealth compared to older White households. The findings confirm that current health status remains a powerful correlate of household wealth and that bequests motives for the elderly are congruent with the extreme wealth disparities. %B The Journals of Gerontology, Series B: Psychological Sciences and Social Sciences %I 52B %V 52B %P 74-81 %G eng %N Spec %L pubs_1997_Smith_JJGSeriesB.pdf %4 Economic Status/Health Status/Wealth/Income Inequality %$ 8080 %0 Report %D 1996 %T 401(k) Pension plans: Many take advantage of opportunity to ensure adequate retirement income %A Hungerford, Thomas L. %K Employment and Labor Force %K Income %K Net Worth and Assets %K Pensions %X This paper provides an in-depth look into 401(k) pension plans. Almost half of all workers and nearly two-thirds of workers nearing retirement age are covered by a pension plan. One in four workers who have pension coverage participates in a 401(k) pension plan. Male, white, highly educated, and higher-income workers are more likely to have pension coverage than are other workers. On average, workers covered by a 401(k) plan contribute 7 of their salary to their account; 80 also receive a matching contribution from their employer, averaging about 5 of their salary. Workers with higher income, college education, defined benefit plan coverage, or a spouse with pension coverage tend to contribute a higher proportion of their of their salary to their 401(k) pension account. About 25 of 401(k) participants invest their 401(k) funds in conservative investments, such as bonds; another 25 invest primarily in stocks; and the rest split their investments between stocks and bonds. Women are more likely to invest in bonds while highly educated workers and higher-income workers are more likely to invest in stocks. %I United States General Accounting Office %G eng %U http://www.gao.gov %4 Labor/Economic Status/401(k) participation and balances/Retirement Incomes %$ 8058 %0 Journal Article %J American Journal of Epidemiology %D 1996 %T Differential Rates of Cardiovascular Disease Among the Immigrant Elderly %A Karen C. Swallen %K Demographics %K Health Conditions and Status %K Net Worth and Assets %X This paper examines the difference in morbidity among foreign-born and native-born elderly populations in the United States. Findings suggest that other differences between immigrant and native populations contribute to differential disease rates. %B American Journal of Epidemiology %I 143 %V 143 %P S50 %G eng %N 11 %4 Immigrants/Morbidity/Nativity/Economic Status/Health Status/Health Behaviors %$ 8160 %0 Journal Article %J Generations %D 1996 %T Empirical Research on How the Elderly Handle Their Estates %A Colleen O'Connor %K Adult children %K Net Worth and Assets %X This article examines past research for its insight into the legacies that people leave and the personal preferences they hold for the distribution of their estates. For the most part, the findings of the research examined are very intuitive. Most people do not have wills. Those that do are generally older, wealthier, more educated, and tend to give the bulk of their estates to spouses and children. In order to provide a complete picture of legacy, future research must take into account modern day relationships and lifestyles. %B Generations %I 20 %V 20 %P 13-20 %G eng %U https://www.jstor.org/stable/pdf/44877942.pdf %N 3 %4 Wills/Economic Status/Family transfers, structure/Family Relations %$ 8176 %0 Report %D 1996 %T Family, Employment Status, and Residential Mobility in the Health and Retirement Study %A Regina M. Bures %K Adult children %K Demographics %K Employment and Labor Force %K Housing %K Net Worth and Assets %X Understanding the relationship between mobility and the family and work transitions experienced by individuals approaching retirement is an important research topic. Both family transitions, such as divorce, widowhood or children leaving home, and work transitions, particularly retirement, influence where individuals will reside and, as they age, how much assistance they may need. This paper uses Waves 1 and 2 of the Health and Retirement Survey (HRS) to examine the residential mobility of the HRS cohort in the context of family and work status changes. The results demonstrate that respondents experiencing both household change and change in work status were more likely to have moved. While household change is a strong predictor of mobility, neighborhood and regional effects are significant predictors of mobility as well. These findings are discussed in the context of the migration and mobility data available in the HRS. Currently, the greatest limitation of using the HRS data for migration research is the lack of information on distance moved. An appendix discusses this issue in detail and suggests ways to make the HRS data more useful for understanding the relationships between mobility and the life transitions experienced by this cohort. %I University of Michigan %G eng %U http://www.psc.isr.umich.edu/pubs/series.html hr %L wp_1996/Bures_hr96-033.pdf %4 Mobility/Labor/Economic Status/Family Structure/Housing/Basic Demographics %$ 6513 %0 Book Section %B Advances in the Economics of Aging %D 1996 %T Living Arrangements: Health and Wealth Effects %A Daniel McFadden %A Axel Borsch-Supan %A Schnabel, R. %E David A Wise %K Health Conditions and Status %K Housing %K Net Worth and Assets %B Advances in the Economics of Aging %I University of Chicago Press %C Chicago, IL %P 193-216 %G eng %4 Housing/Wealth/Health Status %$ 8262 %! Living Arrangements: Health and Wealth Effects %0 Journal Article %J The Gerontologist %D 1996 %T Racial Differences in Home Ownership and Home Equity Among Preretirement-Aged Households %A Myers, Samuel L., Jr. %A Chung, Chanjin %K Health Conditions and Status %K Housing %K Net Worth and Assets %K Risk Taking %X The article seeks to determine the extent of unexplained racial residual in home ownership and home equity that could possibly be explained by discrimination on the part of lenders or other institutions. While many factors differ substantially between black and white households- besides family income, none of these factors can explain much of the overall inequality in home equity. Although there are sizable income disparities that lead to lower home ownership rates among blacks, these alone are only sufficient in explaining about a quarter of the gap in expected home equity between blacks and whites. This means that the remaining portion of unexplained racial gaps is large and appears to support the hypothesis that the underlying cause of racial differences in expected home equity rests with the behavior of lenders and creditors. %B The Gerontologist %I 36 %V 36 %P 350-360 %G eng %U https://watermark.silverchair.com/36-3-350.pdf?token=AQECAHi208BE49Ooan9kkhW_Ercy7Dm3ZL_9Cf3qfKAc485ysgAAAm0wggJpBgkqhkiG9w0BBwagggJaMIICVgIBADCCAk8GCSqGSIb3DQEHATAeBglghkgBZQMEAS4wEQQM-RDxaDpMZDz3H2beAgEQgIICIAtTxJSIZCNKW_vROXcAtwEdDsOeY9BViR7Uuyz3fIQuG8 %N 3 %L pubs_1996_Myers_SGer.pdf %4 Economic Status--net worth, financial planning/Housing/Attitudes Toward Risk/Health Status--cognitive skills %$ 8038 %0 Journal Article %J The Gerontologist %D 1996 %T The Role of Bridge Jobs in the Retirement Transition: Gender, Race and Ethnicity %A Joseph F. Quinn %A Kozy, M. %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %K Retirement Planning and Satisfaction %K Women and Minorities %X This paper uses the first wave of HRS data to describe the retirement patterns of the 1990s and to investigate whether these patterns differ by race and ethnicity. Results demonstrate that retirement patterns are varied, even within narrowly defined age groups. Many Americans, probably more in the future, are choosing to retire gradually and are turning to bridge jobs as a transitional stage between a career job and complete labor force withdrawal. There are in fact differences in how people leave the labor force by race and ethnicity, although they do not fall into an obvious pattern. This wave of data shows that Hispanic men are more likely than both white and black men to be on or have last worked on a bridge job. Among women, blacks are least likely to have last worked on a bridge job. Further research on these results is planned for when the future waves of HRS data become available. %B The Gerontologist %I 36 %V 36 %P 363-372 %G eng %N 3 %L pubs_1996_Quinn_JGer.pdf %4 Bridge Jobs/Labor Force Participation/Retirement Planning/Health Status/Economic Status/Blacks/Hispanics/Women %$ 8042 %R 10.1093/geront/36.3.363 %0 Journal Article %J Journal of Human Resources %D 1995 %T Economic Status Measures in the Health and Retirement Study %A Marilyn Moon %A Juster, F. Thomas %K Employment and Labor Force %K Net Worth and Assets %K Other %X Variables measuring economic status represent a straightforward but crucial part of Round 1 of the Health and Retirement Study (HRS). In addition to studies focusing directly on the economic well-being of this cohort of the population, the economic status variables are likely to be inputs into other analyses that focus on retirement and savings behavior, on variations in health status, on intrafamily transfers and support, and on poverty status. As a first look at these data, this paper has several modest goals: to offer a flavor for the major economic status variables on the HRS, to indicate some preliminary analysis of the quality of the data, and to take a preliminary look at the interrelationships among economic status measures like income and wealth and other important variables such as health status, pension rights, and health insurance coverage. %B Journal of Human Resources %I 30 %V 30 %P S138-57. %G eng %N 0 Suppl. %L pubs_1995_Moon_MJHR.pdf %4 Economic Status/Distribution/Wages and Compensation %$ 1092 %R 10.2307/146281 %0 Journal Article %J Journal of Human Resources %D 1995 %T Family Structure and Transfer Measures in the Health and Retirement Study: Background and Overview %A Beth J Soldo %A Martha S. Hill %K Adult children %K Demographics %K Net Worth and Assets %X This paper describes the rationale for and the measures of family structure and inter-vivos giving in the Health and Retirement Study (HRS). Of particular interest to the HRS is the extent to which transfers affect the labor supply of donors, especially women. Because all children and parents are individually profiled, HRS data can be used to examine the joint allocation of space, time, and money among competing kin. Data on siblings of respondents with living parents provide further opportunities to consider how adult children distribute the burden of parent care among themselves. Using the baseline HRS, we describe the quality of data on kin attributes and the correlations among family structures, transfers, and work. %B Journal of Human Resources %I 30 %V 30 %P S108-37 %G eng %N 0 Suppl. %L pubs_1994_Soldo_BJHR.pdf %4 Family Structure/Demographic Trends and Forecasts/Household Production/Transfers/Adult Children/Parent Child Relations %$ 1050 %R 10.2307/146280 %0 Report %D 1995 %T Lump-Sum Distributions from Retirement Saving Plans: Receipt and Utility %A James M. Poterba %A Steven F Venti %A David A Wise %K Income %K Net Worth and Assets %X One of the central issues in evaluating the ongoing shift from defined benefit (DB) to defined contribution (DC) pension plans is the degree to which assets in DC plans will be withdrawn before plan participants reach retirement age. The annual flow of withdrawals from such plans, which are known as lump sum distributions and which are frequently but not always associated with employment changes, has exceeded 100 billion in recent years. This flow is substantially greater than the flow of new contributions to IRAs and other targeted retirement saving programs. This paper draws on data from the 1993 Current Population Survey and the Health and Retirement Survey to summarize the incidence and disposition of lump sum distributions. We find that while less than half of all lump sum distributions are rolled over into IRAs or other retirement saving plans, large distributions are substantially more likely to be saved than smaller ones are. Consequently, more than half of the dollars paid out as lump sum distributions are reinvested. We also explore the correlation between various individual characteristics and the probability of rolling over a lump sum distribution. This is a first step toward developing a model that can be used to evaluate the long- term effects of lump sum distributions, or policies that might affect them, on the financial status of elderly households. %I NBER %G eng %U https://www.researchgate.net/publication/5193273_Lump-Sum_Distributions_from_Retirement_Saving_Plans_Receipt_and_Utilization %L wp_1995/poterba-wise_NBER5298.pdf %4 Retirement Incomes/Distribution %$ 6655 %0 Report %D 1995 %T Marriage, Assets, and Savings %A James P Smith %K Adult children %K Consumption and Savings %K Net Worth and Assets %X No %I Santa Monica, CA., RAND Corporation %G eng %4 Assets/Savings/Marital status %$ 6514 %0 Journal Article %J Journal of Agricultural Safety and Health %D 1995 %T Occupational Injuries Among Agricultural Workers 51 to 61 Years Old: A National Study %A Zwerling, Craig %A Nancy L. Sprince %A Robert B Wallace %A Charles S. Davis %A Paul S. Whitten %A Steven G Heeringa %K Demographics %K Employment and Labor Force %K Health Conditions and Status %K Net Worth and Assets %X This paper examines risk factors for occupational injuries among agricultural workers and compares them with the risk factors for injury among other older workers. The findings suggest that the risks for occupational injuries among agricultural workers differ from those that affect workers in all other occupations. While heavy lifting and poor eye sight were risk factors for both agricultural and other workers, self-employment- - which acted as a protective factor for other workers- - proved to be a risk factor for agricultural workers. Other variables - depressive symptoms and dissatisfaction with marriage, job, family life, the way problems are handled, and life overall - tended to be more strongly associated with occupational injuries in agricultural workers than among other workers. %B Journal of Agricultural Safety and Health %I 1 %V 1 %P 273-281 %G eng %U https://elibrary.asabe.org/abstract.asp?search=1&JID=3&AID=19469&CID=j1995&v=1&i=4&T=1&urlRedirect=[anywhere=&keyword=&abstract=&title=on&author=&references=&docnumber=&journals=All&searchstring=Occupational%20Injuries%20among%20Agricultural%20Workers&pg= %N 4 %4 Self-Employment/Labor/Occupational Injury/Basic Demographics/Health Status/Health Behaviors/Economic Status %$ 8048 %R 10.13031/2013.19469 %0 Journal Article %J Journal of Human Resources %D 1995 %T Racial and Ethnic Differences in Wealth in the Health and Retirement Study %A James P Smith %K Demographics %K Income %K Methodology %K Net Worth and Assets %K Women and Minorities %X This paper examines wealth data in the Health and Retirement Study (HRS). In comparison with asset data in other major surveys, the quality of HRS asset data is high. Missing asset data does remain a problem, however, to which future HRS analysts must remain sensitive. Evidence is presented showing that it is no accident that asset data are missing, and solutions for imputing missing data are developed. Finally, racial and ethnic wealth disparities are large. These minority wealth disparities are due in part to differential inheritances and desired bequests as inequities perpetuate themselves across generations; the disparities are also due to lower minority incomes, poorer health, and an excessively narrow definition of wealth that excludes Social Security and employer pensions. %B Journal of Human Resources %I 30 %V 30 %P S158-83 %G eng %N 0, Suppl. %L pubs_1995_Smith_JJHR.pdf %4 Economics of Minorities/Personal Income and Wealth Distribution/Wealth/Ethnicity/Data Collection and Data Estimation Methodology %$ 1106 %0 Journal Article %J RAND Documented Briefings %D 1995 %T Unequal Wealth and Incentives to Save %A James P Smith %K Consumption and Savings %K Net Worth and Assets %X Two recent surveys of household wealth funded by the National Institute on Aging, one of households containing people ages 51-61 and the other of households containing at least one person over age 70, show not only tremendous racial and ethnic disparities in wealth but also great disparities between the poor and the wealthy that are not fully accounted for by differences in income. Household wealth is adversely affected by family breakup, worsening health, and stringent asset tests that provide a disincentive for the poor to save. Although middle-aged people seem to have savings adequate for retirement, those in their 20s and 30s do not. Our long-run policy goals should be to place realistic limits on Social Security and Medicare, to encourage private savings through such moves as a consumption tax and a mandatory Provident-type fund, and to change asset limits in means-tested programs for the poor. %B RAND Documented Briefings %I RAND Distribution Services %@ 0-8330-2289-X %G eng %U https://www.rand.org/pubs/documented_briefings/DB145.html %4 Saving/Wealth %$ 6552 %0 Report %D 1994 %T The Impact of Demographics on Housing and Non-Housing Wealth in the United States %A Hoynes, Hilary %A Daniel McFadden %K Adult children %K Consumption and Savings %K Demographics %K Net Worth and Assets %K Public Policy %X Equity in housing is a major component of household wealth in the United States. Steady gains in housing prices over the last several decades have generated large potential gains in household wealth among homeowners. Mankiw and Weil (1989) and McFadden (1993b) have argued that the aging of the U.S. population is likely to induce substantial declines in housing prices, resulting in capital losses for future elderly generations. However, if households can anticipate changes in housing prices, and if they adjust their non-housing savings accordingly, then welfare losses in retirement could be mitigated. This paper focuses on two questions: (1) Are housing prices forecastable from current information on demographics and housing prices?; and (2) How are household savings decisions affected by capital gains in housing? We use metropolitan statistical area (MSA) level data on housing prices and demographic trends during the 1980's and find mixed evidence on the forecastability of housing prices. Further, we use data on five-year savings rates from the Panel Study of Income Dynamics and find no evidence that households engage in changing their non-housing savings in response to expectations about capital gains in housing. Thus, the projected decline in housing prices could result in large welfare losses to current homeowners and large intergenerational equity differences. %B NBER Working Paper %I The National Bureau of Economic Research %C Cambridge %G eng %U https://www.nber.org/papers/w4666 %4 Consumer Economics: Empirical Analysis/Consumer Economics: Empirical Analysis/Equity, Justice, Inequality, and Other Normative Criteria and Measurement/Demographic Trends and Forecasts/Demographics/Equity/Households/Population/Wealth %$ 1074 %0 Report %D 1993 %T Respondent Rules and the Quality of Net Worth Data in the HRS %A Daniel H. Hill %K Methodology %K Net Worth and Assets %X The HRS uses an informed selection procedure in choosing with spouse to ask about the household's assets and debts. This is more expensive than presumptive selection which has been commonly employed in past surveys. This paper evaluates the quality of the resulting net worth data in terms of the exactness of the reports. A trivariate ordered probit model is developed and estimated. This model controls for the self-selectivity of both the gender and proxy interview status of the net-worth respondent. The results suggest that the informed selection procedure does indeed result in lower item non-response and less reliance on approximation strategies than would a presumptive husband R1 respondent rule. %I University of Michigan %G eng %U http://www.psc.isr.umich.edu/pubs/series.html %L wp_1993/Hill_RRules.pdf %4 Net Worth/Data Quality/Data Collection and Data Estimation Methodology %$ 6500