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Individuals' uncertainty about future social security benefits and portfolio choice
Author(s) -
Delavande Adeline,
Rohwedder Susann
Publication year - 2011
Publication title -
journal of applied econometrics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.878
H-Index - 99
eISSN - 1099-1255
pISSN - 0883-7252
DOI - 10.1002/jae.1235
Subject(s) - social security , portfolio , variation (astronomy) , health and retirement study , economics , actuarial science , public economics , business , financial economics , physics , astrophysics , market economy , gerontology , medicine
Little is known about the degree to which individuals are uncertain about their future Social Security benefits, how this varies within the US population, and whether this uncertainty influences financial decisions related to retirement planning. To illuminate these issues, we present empirical evidence from the Health and Retirement Study Internet Survey and document systematic variation in respondents' uncertainty about their future Social Security benefits by individual characteristics. We find that respondents with higher levels of uncertainty about future benefits hold a smaller share of their wealth in stocks. Copyright © 2011 John Wiley & Sons, Ltd.