Medical Spending, Bequests, and Asset Dynamics around the Time of Death
Mariacristina De Nardi,
Eric French,
John Jones,
Rory McGee and
Rachel Rodgers
Econ Focus, 2020, vol. 4Q, 135-157
Abstract:
Using data from the Health and Retirement Survey, we document the changes in assets that occur before a person's death. Applying an event study approach, we find that during the six years preceding their deaths, the assets of single decedents decline, relative to those of similar single survivors, by an additional $20,000 on average. Over the same time span, the assets of couples who lose a spouse fall, relative to those of similar surviving couples, by an additional $90,000 on average. Households experiencing a death also incur higher out-of-pocket medical spending and other end-of-life expenses. This elevated spending is sufficient to explain (in accounting terms) the asset declines observed for singles but falls short of explaining the declines observed for couples. Bequests from the dying spouse to nonspousal heirs, such as children, are more than sufficient to explain the remainder.
Keywords: Health; Retirement; Death (search for similar items in EconPapers)
Date: 2020
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Journal Article: Medical Spending, Bequests, and Asset Dynamics around the Time of Death (2020)
Working Paper: Medical Spending, Bequests, and Asset Dynamics Around the Time of Death (2020)
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DOI: 10.21144/eq1060401
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