By James P. Naughton Testimony on “The Cost of Inaction: Why Congress Must Address the Multiemployer Pension Crisis” Before the Education and Labor Committee’s Subcommittee on Health, Employment, Labor, and Pensions Plans. Source @SSRN
By: Giovanna Apicella, Enrico G. De Giorgi, Emilia Di Lorenzo & Marilena Sibillo Longevity crucially affects demand for pensions, insurance products and annuities. Consistent empirical evidence shows that women have historically experienced lower mortality rates than men. In this paper, we study a measure of the gender gap in mortality rates, we call “Gender Gap Ratio”, across a wide range of ages and for four countries: France, Italy, Sweden and USA. We show the stylized facts that characterize the trend...
By Ernst-Jan de Bruijn, Gerrit Antonides & Tamara Madern Financially vulnerable consumers are often associated with suboptimal financial behaviors. Evaluated financial education programs so far show difficulties to effectively reach this target population. In our attempt to solve this problem, we built a behaviorally informed financial education program incorporating insights from both motivational and behavioral change theories. In a quasi-experimental field study among Dutch financially vulnerable people, we compared this program with both a control group and a traditional program group....
By Andrew Stumpff Morrison The historic U.S. shift from defined-benefit to defined-contribution employer-sponsored retirement plans has produced, among other things, a reduction in sharing of the risk of outliving one’s retirement savings. Commercial annuity contracts are available to insure this risk, but despite efforts to encourage their acquisition, few people own them. Close comparison with another life-cycle risk – that addressed by life insurance, which is more widely purchased by consumers – highlights as a probable reason for this low...
By Hans Fehr & Adrian Fröhlich This paper develops a general equilibrium life-cycle model with endogenous retirement and disability risk, in order to quantify the impact of recent pension reforms in Germany. At certain ages households may either apply for disability pensions (DP) or old-age pensions (OAP), de-pending on eligibility rules and the generosity of the two programs. Our policy analysis focus on the increase in the normal retirement age (NRA) from age 65 to 67 (Reform 2007) and the recent...
By Sebastian Becker, Hermann Buslei, Johannes Geyer & Peter Haan This study provides novel evidence about the pension wealth elasticity of employment. For the identification we exploit reform-induced variation of pension wealth that is related to the number of children but which does not affect the implicit tax rate of employment. We use a difference-in-differences estimator based on administrative data from the German pension insurance and find that, on average, the negative employment effect of pension wealth is significant and economically...
By: Hans van Meerten Worldwide we see a move to DC schemes. Most – if not all countries – choose the operate DB next to DC. However, in The Netherlands, the legislator choose for so-called conversion: transforming 'old' DB- to 'new' DC. In 2011, the Dutch legislator introduced the so called 'Pension Custodian'. It could only be used for the Dutch 2nd pillar DC IORP, the PPI. This Pension Custodion should *not* be confused with the IORP II Custodian. However, with the implementation of...
By: M Hurd & Susann Rohwedder There has been extensive research on the importance of saving for retirement and on tools to support the accumulation of retirement wealth. Much less attention has been paid to the decumulation phase, that is, the spending down of wealth following retirement. Understanding the decumulation phase requires information about the spending patterns of older households and how those patterns evolve with age. This study uses comprehensive longitudinal data on total household spending from a survey...
By Gopi Goda, Matthew Levy, Colleen Flaherty Manchester, Aaron Sojourner, Joshua Tasoff & Jiusi Xiao We conduct a randomized controlled trial to understand how a web-based retirement saving calculator affects workers' retirement-savings decisions. In both conditions, the calculator projects workers' retirement income goal. In the treatment condition, it also projects retirement income based on defined-contribution savings, prominently displays the gap between projected goal and actual retirement income, and allows users to interactively explore how alternative, future contribution choices would affect...
By Hessam Bavafa, Anita Mukherjee & Tyler Welch Recent work has established that the gradient of life expectancy with respect to wealth is large and widening. We make three contributions to build on that result using two recent decades of data from the United States. First, the additional years are in healthy, disability-free years, indicating substantial gains for the wealthy. Second, the return to wealth in achieving these healthy years is increasing over two recent decades for all but the...
