Savings and Consumption When Children Move Out
Simon Rottke and
Alexander Klos
Review of Finance, 2016, vol. 20, issue 6, 2349-2377
Abstract:
We show, using data from the Italian Survey on Household Income and Wealth and the German Socio-economic Panel, that household consumption drops after a child moves out of a household, while at the same time adult-equivalent consumption increases significantly. After all children are gone, parents upgrade their personal lifestyle to a level approximately that of childless peers, and save only a small proportion of the freed-up resources. Since parents had fewer resources to save while they were young, retirement preparedness among them is a more serious concern than among childless individuals.
JEL-codes: D12 D14 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (1)
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Persistent link: https://EconPapers.repec.org/RePEc:oup:revfin:v:20:y:2016:i:6:p:2349-2377.
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