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Demographic Change, Social Security Systems, and Savings

Bloom, David E. - 2010

little effect on savings rates. In many countries, however, retirement incentives in social security programs prevent … retirement ages from keeping pace with changes in life expectancy, leading to an increased need for life-cycle savings. Analyzing … a cross-country panel of macroeconomic data, we find that increased longevity raises aggregate savings rates in …

Persistent link: https://www.econbiz.de/10012760611

How Would 401(K) ‘Rothification’ Alter Saving, Retirement Security, and Inequality?

Horneff, Vanya; Maurer, Raimond; Mitchell, Olivia S. - 2022

The US has long incentivized retirement saving in 401(k) and similar retirement accounts by permitting workers to defer taxes on contributions, levying them instead when retirees withdraw funds in retirement. This paper develops a dynamic life cycle model to show how and whether...

Persistent link: https://www.econbiz.de/10014239611

Betting on Death and Capital Markets in Retirement : A Shortfall Risk Analysis of Life Annuities

Dus, Ivica - 2005

Retirees must draw down their accumulated assets in an orderly fashion, so as not to exhaust their funds too soon. We compare alternative phased withdrawal strategies to a life annuity benchmark using German data; one particular phased withdrawal rule seems attractive, as it offers relatively low...

Persistent link: https://www.econbiz.de/10012784759

A Theory of Retirement

Bloom, David E. - 2007

We construct a life-cycle model in which retirement occurs at the end of life as a result of declining health. We show that improvements in life expectancy, coupled with a delay in the onset of disability, increases both the optimal consumption level and the proportion of life spent in leisure....

Persistent link: https://www.econbiz.de/10012775556

Money in Motion : Dynamic Portfolio Choice in Retirement

Horneff, Wolfram J. - 2007

Retirees confront the difficult problem of how to manage their money in retirement so as to not outlive their funds while continuing to invest in capital markets. We posit a dynamic utility maximizer who makes both asset location and allocation decisions when managing her retirement financial...

Persistent link: https://www.econbiz.de/10012777579

Optimizing the Retirement Portfolio : Asset Allocation, Annuitization, and Risk Aversion

Horneff, Wolfram J. - 2007

Retirees must draw down their accumulated assets in an orderly fashion so as not to exhaust their funds too soon. We derive the optimal retirement portfolio from a menu that includes payout annuities as well as an investment allocation and a withdrawal strategy, assuming risk aversion,...

Persistent link: https://www.econbiz.de/10012778385

Managing Contribution and Capital Market Risk in a Funded Public Defined Benefit Plan : Impact of Cvar Cost Constraints

Maurer, Raimond - 2010

Using a Monte Carlo framework, we analyze the risks and rewards of moving from an unfunded defined benefit pension system to a funded plan for German civil servants, allowing for alternative strategic contribution and investment patterns. In the process we integrate a Conditional Value at Risk...

Persistent link: https://www.econbiz.de/10012758393

The Effect of Subjective Survival Probabilities on Retirement and Wealth in the United States

Bloom, David E. - 2010

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...

Persistent link: https://www.econbiz.de/10012760540

Implications of Money-Back Guarantees for Individual Retirement Accounts : Protection then and Now

Horneff, Vanya - 2019

In the wake of the financial crisis and continued volatility in international capital markets, there is growing interest in mechanisms that can protect people against retirement account volatility. This paper explores the consequences for savers' wellbeing of implementing market-based retirement...

Persistent link: https://www.econbiz.de/10012860441

The Effect of Uncertain Labor Income and Social Security on Life-Cycle Portfolios

Maurer, Raimond - 2010

This paper examines how labor income volatility and social security benefits can influence lifecycle household portfolios. We examine how much the individual optimally saves and where, taking into account liquid financial wealth and annuities, and stocks as well as bonds. Higher labor income...

Persistent link: https://www.econbiz.de/10013148650