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Planning for Retirement? The Importance of Time Preferences


  • Robert L. Clark

    (North Carolina State University
    National Bureau of Economic Research)

  • Robert G. Hammond

    (North Carolina State University)

  • Christelle Khalaf

    (Ohio University)


Ensuring retirement income security is a priority for individuals, employers, and policymakers. To achieve this, employers and policymakers sponsor and subsidize retirement saving plans and provide educational interventions. The effectiveness of these tools will depend on individuals’ interest and willingness to engage in planning and preparing for retirement. Using merged administrative and survey data for public sector workers in North Carolina, we find that individuals who more heavily discount the future are less likely to plan and save for retirement. Further, retirement planning behavior is measured both subjectively and objectively, and time preferences have an association with subjectively measured retirement planning but not with objectively measured retirement planning. Finally, individuals’ retirement timing is associated with time preferences but only among individuals with a retirement plan. In total, our results highlight the important role of time preferences in determining retirement planning and preparedness.

Suggested Citation

  • Robert L. Clark & Robert G. Hammond & Christelle Khalaf, 2019. "Planning for Retirement? The Importance of Time Preferences," Journal of Labor Research, Springer, vol. 40(2), pages 127-150, June.
  • Handle: RePEc:spr:jlabre:v:40:y:2019:i:2:d:10.1007_s12122-019-09287-y
    DOI: 10.1007/s12122-019-09287-y

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    2. Nolan, Anne & Whelan, Adele & McGuinness, Seamus & Maître, Bertrand, 2019. "Gender, pensions and income in retirement," Research Series, Economic and Social Research Institute (ESRI), number RS87, September.
    3. Bokern, Paul & Linde, Jona & Riedl, Arno & Werner, Peter, 2023. "The robustness of preferences during a crisis: The case of COVID-19," Research Memorandum 012, Maastricht University, Graduate School of Business and Economics (GSBE).
    4. Benjamin Volland, 2018. "Après nous le déluge? Perceived distance of climate change impacts and pro-environmental behaviour," IRENE Working Papers 18-05, IRENE Institute of Economic Research.
    5. Clark, Robert L. & Hammond, Robert G. & Liu, Siyan, 2021. "Work after retirement: worklife transitions of career public employees," Journal of Pension Economics and Finance, Cambridge University Press, vol. 20(3), pages 341-356, July.
    6. Gallego-Losada, Rocío & Montero-Navarro, Antonio & Rodríguez-Sánchez, José-Luis & González-Torres, Thais, 2022. "Retirement planning and financial literacy, at the crossroads. A bibliometric analysis," Finance Research Letters, Elsevier, vol. 44(C).
    7. Vieira, Kelmara Mendes & Rosenblum, Tamara Otilia Amaral & Matheis, Taiane Keila, 2022. "And tomorrow, how will it be? Developing a Financial Preparation for Retirement Scale (FPRS)," Journal of Behavioral and Experimental Finance, Elsevier, vol. 35(C).
    8. Robert L. Clark & Robert G. Hammond & Melinda Sandler Morrill & Christelle Khalaf, 2017. "Nudging Retirement Savings: A Field Experiment on Supplemental Plans," NBER Working Papers 23679, National Bureau of Economic Research, Inc.
    9. Börsch-Supan, Axel & Bucher-Koenen, Tabea & Hurd, Michael D. & Rohwedder, Susann, 2023. "Saving regret and procrastination," Journal of Economic Psychology, Elsevier, vol. 94(C).

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    More about this item


    Retirement planning; Time preferences; Impatience;
    All these keywords.

    JEL classification:

    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions


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