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Housing Wealth Management at Retirement

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  • Heilbron, John

Abstract

This paper estimates the e ect of retirement on the liquidation of housing assets. I use programmatic Social Security eligibility thresholds to instrument for retirement and find that retirement makes a household 12% more likely to issue any new mortgage debt and 3% more likely to extract equity from a home within the following two years. Retirement-induced housing wealth liquidation increases liquid balances to a greater extent than does ordinary housing wealth liquidation; this evidence is consistent with retirement-induced refinancing being a pro-active planning decision rather than a response to adverse expense shocks. Evidence on specific household motives for liquidating housing wealth is mixed.

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  • Heilbron, John, 2019. "Housing Wealth Management at Retirement," MPRA Paper 125715, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:125715
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance

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