November 2019

04Nov

Behind the Success of Dominated Personal Pension Plans: Sales Force and Financial Literacy Factors

By Giuseppe Marotta (Department of Economics Marco Biagi and CEFIN) The revealed preference for dominated insurance-based personal pension plans in Italy is a decade-long puzzle. I surmise that a motivation from the supply side is a sales force factor deriving from the geographical distribution of financial providers, including the countrywide network of the state controlled Post Office. I provide supporting evidence using three biennial waves of the Bank of Italy’s survey on household finances from 2010 to 2014. The time...

November 4, 2019
Articles, Savings,
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04Nov

Evidence on Usage Behavior and Future Adoption Intention of Fintechs and Digital Finance Solutions

By Johannes M. Gerlach (Chair of Financial Services, Faculty of Business Administration and Economics, Heinrich-Heine-University) & Julia K. T. Lutz (Chair of Financial Services, Faculty of Business Administration and Economics, Heinrich-Heine University) Financial Technology Companies are gaining popularity and becoming more relevant within financial services industries worldwide. This growth can be encouraged by the EY FinTech Adoption Index, which indicates a global average FinTech Adoption of 33.0% in 2017. With regard to Financial Technology Companies and Digital Finance Solutions, this...

November 4, 2019
Articles, Investing, Savings, ,
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October 2019

25Oct

Don’t Save for Retirement: A Millennial’s Guide to Financial Freedom

By Daniel Ameduri Baby boomers are always giving millennials advice on the importance of saving for retirement. But Daniel Ameduri says that the results are in for the retirement experiment of the last 75 years and they’re really bad. When he was twenty-seven years old, Daniel was on the brink of bankruptcy. A decade later, he’s a multi-millionaire, having taught himself about economics, investing, and other money matters that he never learned at school or at home. The expert...

October 25, 2019
Books, Pension design, Savings, , ,
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25Oct

Measuring Household Wealth in the Panel Study of Income Dynamics: The Role of Retirement Assets

By Daniel Cooper, Karen E. Dynan, Hannah Rhodenhiser While the Panel Study of Income Dynamics (PSID) has much to offer researchers studying household behavior, one limitation is that its summary measure of wealth is not as broad as those of other commonly used surveys, such as the Survey of Consumer Finances (SCF), because it does not include the value of defined-contribution (DC) pensions. This paper describes the pension data available in the PSID and shows how they can be...

October 25, 2019
Articles, Investment, Savings, ,
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18Oct

Effects of Taxes and Safety Net Pensions on Life-Cycle Labor Supply, Savings and Human Capital: The Case of Australia

By Michael P. Keane, Fedor Iskhakov In this paper we structurally estimate a life-cycle model of consumption/savings, labor supply and retirement, using data from the Australian HILDA panel. We use the model to evaluate effects of the Australian aged pension system and tax policy on labor supply, consumption and retirement decisions. Our model accounts for human capital accumulation via learning by doing, as well as wealth accumulation and decumulation over the life cycle, uninsurable wage risk, credit constraints, a...

October 18, 2019
Articles, Labor Market, Pension design, Savings, , ,
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18Oct

Motivated Saving: The Impact of Projections on Retirement Saving Intentions

By George Smyrnis, Hazel Bateman, Loretti Dobrescu, Ben Rhodri Newell, Susan Thorp The implications of current balance information for retirement provision are considerably difficult to grasp or anticipate. We study how balance and/or income projections motivate the voluntary savings intentions of pension plan participants over a sequence of ten choices. To this effect, we collect savings intentions from 1,615 respondents aged 25-57 years via an online experimental survey that compares four different formats for retirement account information. The formats...

October 18, 2019
Articles, Pension design, Savings, ,
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September 2019

27Sep

Does Automatic Enrollment Increase Contributions to Supplement Retirement Programs by K-12 and University Employees?

By Robert L. Clark, Denis Pelletier This study examines the impact of the adoption of automatic enrollment provisions by schools and universities in the state of South Dakota for its supplemental retirement saving plan (SRP). In South Dakota, educational personnel are also covered by a defined benefit pension plan and by Social Security. Thus, career public employees in South Dakota can expect a life time annuity from these two programs of around 75 percent of their final salary. Prior...

September 27, 2019
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August 2019

30Aug

The Disruptive Impact of FinTech on Retirement Systems

By Julie Agnew, Olivia S. Mitchell Many people need help planning for retirement, saving, investing, and decumulating their assets, yet financial advice is often complex, potentially conflicted, and expensive. The advent of computerized financial advice offers huge promise to make accessible a more coherent approach to financial management, one that takes into account not only clients' financial assets but also human capital, home values, and retirement pensions. Robo-advisors, or automated on-line services that use computer algorithms to provide...

August 30, 2019
Books, Pension design, Pension Management, Savings, System Sustainability, ,
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30Aug

The Impact of Governmental Accounting Standards on Public-Sector Pension Funding

By Divya Anantharaman, Elizabeth Chuk The funding policy for defined benefit pension plans covering government employees represents an important decision for government entities sponsoring those plans. In recent years, a number of state and local governments have experienced extreme funding shortfalls (e.g., New Jersey, Illinois, and Detroit), raising concerns about whether government entities are contributing enough to their pensions. Governmental Accounting Standards Board Statements Number 67/68 (hereafter, “GASB 67/68”) fundamentally alter the financial reporting of pension liabilities, by (i)...

August 30, 2019
Articles, Pension design, Savings, System Sustainability, , ,
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23Aug

Wealth: The Ultra-High Net Worth Guide to Growing and Protecting Assets

By Richard P. Rojeck With few exceptions, books on personal finance focus on investing. And with few exceptions, these same books focus on the general public. This book takes a comprehensive approach to the subject, directed to the ultra-high net worth reader, filling this void. While there is no shortage of experts in legal, tax, investment, and other matters, in many ways, ultra-high net worth individuals are underserved, even as they are confronted with potentially increasing challenges...

August 23, 2019
Books, Investing, Savings,
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