Annuitized Wealth and Post-Retirement Saving

John Laitner (), Dan Silverman and Dmitriy Stolyarov

No 20547, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We introduce a tractable model of post-retirement saving behavior in which households have a precautionary motive arising from uninsured health status risks. The model distinguishes between annuitized and non-annuitized wealth, emphasizes the importance of asset composition in determining optimal household behavior, and includes an extension allowing late-in-life exchange transactions among relatives. We consider three puzzles in micro data - rising cohort average wealth of retirees, lack of demand for market annuities, and the relative scarcity of bequests - and show that our model can provide intuitive explanations for each.

JEL-codes: D91 E21 H55 (search for similar items in EconPapers)
Date: 2014-10
New Economics Papers: this item is included in nep-age and nep-mac
Note: AG EFG PE
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Citations: View citations in EconPapers (3)

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