November 2021
26Nov

Preventing Reforming Unequally

By Axel H. Boersch-Supan, Klaus Härtl, Duarte Nuno Leite & Alexander Ludwig Population aging has forced policy makers in most developed countries to reform pension systems with the aim to maintain or re-establish financial sustainability. This usually involves cost-cutting measures like later pension eligibility ages and lower replacement rates. Such reforms face harsh trade-offs with the objective of providing adequate pensions. Social welfare and inequality have emerged as crucial concerns about recent pension reforms, stressing that the lack of 'social...

November 26, 2021
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23Nov

Low-income Greek pensioners to get one-off grant to buffer price surge

ATHENS- Greece will hand out one-off grants to low-income pensioners and medical staff ahead of Christmas to shield them from higher energy and food prices, Prime Minister Kyriakos Mitsotakis said on Monday. Consumer inflation hit a multi-year high of 3.4% in October with costs in the housing sector rising by an annual 7.8%, mainly due to rising electricity, heating oil and natural gas prices. The government has already spent about 700 million euros ($790 million)on subsidies for the majority of Greek...

November 23, 2021
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12Nov

Experts say the 4% rule, a popular retirement income strategy, is outdated

Market conditions are pressuring the 4% rule, a popular rule of thumb for retirees to determine how much money they can live on each year without fear of running out later. Withdrawing money from one’s nest egg is among the most complex financial exercises for households. There are many unknowns — the length of retirement, one’s spending needs (health costs, for example) and investment returns, to name a few. The 4% rule is meant to yield a consistent stream of annual...

November 12, 2021
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05Nov

The Economic Burden of Pension Shortfalls: Evidence from House Prices

By Darren Aiello, Asaf Bernstein, Mahyar Kargar, Ryan Lewis & Michael Schwert U.S. state pensions are underfunded by trillions of dollars, but their economic burden is unclear. In a model of inefficient taxation, real estate fully reflects the cost of pension shortfalls when it is the only form of immobile capital. We study the effect of pension shortfalls on real estate values at state borders, where labor and physical capital could more easily relocate to a state with a smaller...

November 5, 2021
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05Nov

Pensions, Income Taxes and Homeownership: A Cross-Country Analysis

By Hans Fehr, Maurice Hofmann & George Kudrna This paper studies the role of pensions and income taxes in determining homeownership and household wealth. It provides a cross-country analysis, using tax and pension policy designs in Germany, the US and Australia. These developed nations have similar incomes per capita but very different homeownership rates, with the US and Australia having much higher homeownership compared to Germany. The question is to what extent the observed differences in homeownership are induced by...

November 5, 2021
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05Nov

UK. State pension payments still delayed for thousands

By Kevin Peachey Thousands of newly-retired people are still yet to receive their first state pension payments after a deadline for backlogs in payments to be cleared. Most delayed pensions to people who have just turned 66 are now being paid following a catch-up exercise by the Department for Work and Pensions (DWP). But applications have yet to be processed for 4,900 people from whom the DWP has asked for extra details. The pandemic and staffing issues were blamed for problems over the...

November 5, 2021
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October 2021
18Oct

US. Trends in Retirement: Focus on Retirement Income

DC plans are addressing a wider range of participant circumstances via more customization, layered communications and programs that build financial resilience The impact of the COVID-19 pandemic and the ongoing variant spread has transformed the U.S. workforce, causing many to retire earlier than planned, others to retire later than planned, and adding to concerns about financial security across the board. For defined contribution plan sponsors, it has honed their participant retirement outcomes using a wider array of products and services,...

October 18, 2021
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18Oct

South Africa. Millennials hardest hit financially in 2020, study shows

Young people employed in medium to large companies and belonging to a retirement fund were harder hit financially by the pandemic than their middle-aged colleagues, with higher retrenchment rates and higher levels of financial stress, as measured by their credit scores and their default rates on debt. This is one of the findings of the annual Alexander Forbes Member Insights report, released this week, which surveyed almost a million members across the hundreds of retirement funds Alexander Forbes administers. While...

October 18, 2021
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11Oct

South Africa: A New Social Assistance Assessment Aims to Help Strengthen Policies and Programs for the Poor

By  India Education Diary Bureau Admin  The World Bank, in collaboration with the Government of South Africa, released a new report assessing the country’s social assistance programs and systems. In an environment of high unemployment, persistent poverty, weak economic growth and shrinking fiscal resources that has been exacerbated by the Covid-19 pandemic, the Social Assistance Programs and Systems Review: South Africa report underscores the critical role of the grant and social assistance system in mitigating poverty. This report also provides...

October 11, 2021
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07Oct

Income Trajectories in Later Life: Longitudinal Evidence from the Health and Retirement Study

By Olivia S. Mitchell, Robert Clark, Annamaria Lusardi We examine respondents in the Health and Retirement Study (HRS) to observe how their financial situations unfolded as they aged. We focus on low-income older adults and follow them over time to identify the factors associated with having low income at baseline and thereafter. We find that (a) real income remained relatively stable as individuals approached and entered retirement, and progressed through their retirement years, and (b) labor force participation declined and...

October 7, 2021
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