Navigating Complex Financial Decisions at Retirement: Evidence from Annuity Choices in Public Sector Pensions

Robert L. Clark, Robert G. Hammond and David Vanderweide

No 25129, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Choices regarding the disposition of wealth at retirement can have substantial implications for retirement income security. We analyze the factors determining annuity option choices offered by a public sector defined pension plan with no default annuity option. Using combined administrative records and survey data, we explore the role of individual and household characteristics as well as risk preferences, time preferences, and financial literacy. The evidence is consistent with predictions over which households might benefit most from each annuity option. Comparing retirees who chose different annuities, we find that these groups of retirees report very different levels of well-being in retirement.

JEL-codes: G2 H55 H7 (search for similar items in EconPapers)
Date: 2018-10
New Economics Papers: this item is included in nep-age, nep-fle and nep-lma
Note: AG
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Published as Navigating Complex Financial Decisions at Retirement: Evidence from Annuity Choices in Public Sector Pensions , Robert L. Clark, Robert G. Hammond, David Vanderweide. in Incentives and Limitations of Employment Policies on Retirement Transitions , Clark and Newhouse. 2019
Published as Robert L. Clark & Robert G. Hammond & David Vanderweide, 2019. "Navigating complex financial decisions at retirement: evidence from annuity choices in public sector pensions," Journal of Pension Economics and Finance, vol 18(04), pages 594-611.

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Journal Article: Navigating complex financial decisions at retirement: evidence from annuity choices in public sector pensions (2019)
Chapter: Navigating Complex Financial Decisions at Retirement: Evidence from Annuity Choices in Public Sector Pensions (2018)
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