The Home, Pension Savings and Risk Aversion: Intentions of the Defined Contribution Pension Plan Participants of a London-based Investment Bank at the Peak of the Bubble

Gordon L. Clark, Stephen Almond and Kendra Strauss

Urban Studies, 2012, vol. 49, issue 6, 1251-1273

Abstract: In the lead-up to the peak of the financial bubble (and before the onset of the global financial crisis), property was regularly promoted as a ready-made alternative to private pensions. This paper explores the importance of owner-occupied housing for the retirement savings strategies of defined contribution (DC) pension plan members. Based upon a unique survey of over 2300 participants in the DC pension scheme of a London-based international bank, an assessment is made of the statistical significance of respondents’ socioeconomic status and risk preference in predicting the significance or otherwise of their home for retirement saving. Relatively few respondents indicated that they were likely to rely on their home. Those that indicated reliance were relatively older, higher-paid and married employees. The paper concludes with implications for understanding the connection between savings behaviour and housing before and after the global financial crisis.

Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:sae:urbstu:v:49:y:2012:i:6:p:1251-1273

DOI: 10.1177/0042098011410332

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