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What is an adequate standard of living during Retirement?
Journal
Journal of Pension Economics and Finance
ISSN
1474-7472
Type
journal article
Date Issued
2012
Author(s)
SCHUNK, DANIEL
Abstract
Many economists and policy-makers argue that households do not save enough to maintain an adequate standard of living during retirement. However, there is no consensus on the answer to the underlying question about what this standard should be, despite the fact that it is crucial for the design of saving incentives and pension systems. We address this question with a randomized survey design, individually tailored to each respondent's financial situa-tion, and conducted both in the U.S. and The Netherlands. We find that adequate levels of retirement spending exceed 80% of working life spending for a majority of respondents. Minimum acceptable income replacement rates range from 95 to 45% across income quin-tiles in the U.S., and from 75 to 60% across income quintiles in The Netherlands. The smaller range in The Netherlands may in part reflect the much tighter income distribution there.
Language
English
HSG Classification
contribution to scientific community
HSG Profile Area
None
Refereed
Yes
Volume
11
Number
02
Start page
203
End page
222
Official URL
Subject(s)
Contact Email Address
johannes.binswanger@unisg.ch
Eprints ID
255455