Economic Preparation for Retirement
In: Investigations in the Economics of Aging
The authors define and estimate measures of economic preparation for retirement based on a complete inventory of economic resources while taking into account the risk of living to advanced old age and the risk of high out-of-pocket spending for health care services. They ask whether, in a sample of 66â€“69 year-olds, observed economic resources could support with high probability a life-cycle consumption path anchored at the initial level of consumption until the end of life. They account for taxes, widowing, differential mortality and out-of-pocket health spending risk. They find that 71% of persons in their target age group are adequately prepared according to our definitions, but there is substantial variation by observable characteristics: 80% of married persons are adequately prepared compared with just 55% of single persons. They estimate that a reduction in Social Security benefits of 30 percent would reduce the fraction adequately prepared by 7.8 percentage points among married persons and by as much as 10.7 percentage points among single persons.
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- Michael Hurd & Susann Rohwedder, 2009.
"Methodological Innovations in Collecting Spending Data: The HRS Consumption and Activities Mail Survey,"
Institute for Fiscal Studies, vol. 30(Special I), pages 435-459, December.
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- Hurd, Michael D. & Rohwedder, Susann, 2011.
"Economic Preparation for Retirement,"
872, RAND Corporation.
- Peter Adams & Michael D. Hurd & Daniel L. McFadden & Angela Merrill & Tiago Ribeiro, 2004.
"Healthy, Wealthy, and Wise? Tests for Direct Causal Paths between Health and Socioeconomic Status,"
in: Perspectives on the Economics of Aging, pages 415-526
National Bureau of Economic Research, Inc.
- Adams, Peter & Hurd, Michael D. & McFadden, Daniel & Merrill, Angela & Ribeiro, Tiago, 2003. "Healthy, wealthy, and wise? Tests for direct causal paths between health and socioeconomic status," Journal of Econometrics, Elsevier, vol. 112(1), pages 3-56, January.
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- Michael D. Hurd & Susann Rohwedder, 2008. "The Adequacy of Economic Resources in Retirement," Working Papers wp184, University of Michigan, Michigan Retirement Research Center.
- Daniel Feenberg & Elisabeth Coutts, 1993. "An introduction to the TAXSIM model," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 12(1), pages 189-194.
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- Michael D. Hurd & Susann Rohwedder, 2013. "Wealth Dynamics and Active Saving at Older Ages," NBER Chapters, in: Improving the Measurement of Consumer Expenditures, pages 388-413 National Bureau of Economic Research, Inc.
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