Empirical tests of the life cycle model have focused on its implications for the level of a household's total net worth and paid little attention to changes in portfolio composition over the life cycle. In this paper, we examine a new survey of the asset holdings of 6,010 U.S households and show...

In this paper, we examine a new survey of 6,010 U.S. households and estimate a model for the allocation of total net worth among different assets. The paper has three main aims. The first is to investigate the extent to which a conventional portfolio choice model can explain the differences in...