The historic boom and bust in the stock market over the past decade had the potential to significantly alter the retirement behavior of older workers. Previous research examining the impact of wealth shocks on labor supply supports the plausibility of this hypothesis. In this paper, we examine the relationship between stock market performance and retirement behavior using the Health and Retirement Study (HRS), Current Population Survey (CPS), and Survey of Consumer Finances (SCF). We first present a descriptive analysis of the wealth holdings of older households and simulate the labor supply response among stockholders necessary to generate observed patterns in retirement. We show that few households have substantial stock holdings and that they would have to be extremely responsive to market fluctuations to explain observed labor force patterns. We then exploit the unique pattern of boom and bust along with variation in stock exposure to generate a double quasi-experiment, comparing the retirement and labor force re-entry patterns over time of those more and less exposed to the market. Any difference in behavior that emerged during the boom should have reversed itself during the bust. We find no evidence that changes in the stock market drive aggregate trends in labor supply.
The historic boom and bust in the stock market over the past decade had the potential to significantly alter the retirement behavior of older workers. Previous research examining the impact of wealth shocks on labor supply supports the plausibility of this hypothesis. In this paper, we examine the relationship between stock market performance and retirement behavior using the Health and Retirement Study (HRS), Current Population Survey (CPS), and Survey of Consumer Finances (SCF). We first present a descriptive analysis of the wealth holdings of older households and simulate the labor supply response among stockholders necessary to generate observed patterns in retirement. We show that few households have substantial stock holdings and that they would have to be extremely responsive to market fluctuations to explain observed labor force patterns. We then exploit the unique pattern of boom and bust along with variation in stock exposure to generate a double quasi-experiment, comparing the retirement and labor force re-entry patterns over time of those more and less exposed to the market. Any difference in behavior that emerged during the boom should have reversed itself during the bust. We find no evidence that changes in the stock market drive aggregate trends in labor supply.
This book brings together in one volume what researchers have learned about workers, employers, and retirees that is important for formulating retirement income policies. As the U.S. population ages, there is increasing uncertainty about the solvency of the Social Security and Medicare systems and the adequacy of private pensions to provide for people's retirement needs. The volume covers such critical behaviors as workers' decisions to retire, people's choices of saving over consumption, and employers' decisions about hiring older workers and providing pension and health care benefits. Also covered are trends in mortality, health status, and health care costs that are key to projecting the likely costs and effects of alternative retirement income security policies and a strategy for combining data and research knowledge into a policy modeling framework.
Do you ever read the headlines about financial happenings and wonder if Wall Street is run by a bunch of animals? In Wall Street and Your Retirement, you'll learn about stock pickin' chickens, cat- and chimp-based stock indexes, and more financial animals, as well as how to keep this monkey business from affecting your lifestyle in retirement. With amusing anecdotes and sensible strategies, industry insider Ron Anno writes about the topics most relevant to retirees (and those who aspire to be), including: - Ways to make the most of Social Security - Strategies for reducing taxes in retirement - Resources for reliable income - and more! About the Author Ron Anno has more than three decades of experience in financial services, and has worked from nearly every angle. His work helping people retire every day informs the stories and strategies he outlines in this, his first book. Ron lives in Sarasota, Florida, with his wife, Debra. They have three adult children and two beautiful granddaughters. What industry professionals are saying about Wall Street and Your Retirement: "I have been a practicing CPA since 1993 and have seen just about every kind of financial strategy or plan ever thought up. Ron Anno's book weeds through all the nonsense, hype and/or worse. His book is easy to read and extremely informative for any level of reader. I would highly recommend this to anyone who is looking to plan for their future. I would also recommend this to anyone in the business to sharpen up their game. Nice job, Ron." - Mark Knauf, CPA "In 'Wall Street and Your Retirement, ' Ron Anno has brought together decades of real-world experience and complicated financial concepts to deliver a quantitative and understandable approach toward financial security. He cuts to the chase so individuals can make sense of the complicated and perilous world of investing. This book is fun, easy to digest, and the information is critical to a successful retirement." - Paul Tarantino SVP Wealth Advisor, Canandaigua National Trust Co. of Florida "Ron Anno's 'Wall Street and Your Retirement' takes the complex and multi-faceted process of retirement planning and breaks it down into its components in a way that is comprehensible to those without specialized financial knowledge. His descriptions of the various elements that compose a retirement plan are concise and free of unnecessary industry jargon or niche phrases. His examples of how these individual parts work together to form a greater whole is direct and unambiguous in underscoring the importance of having a financial professional with diversified knowledge planning for your retirement goals." - Paul J. Bupivi, Esq., Lawrence & Associates-Counselors at Law "Retirement planning is crucial for almost everyone. Yet, most of us do not understand how to set up a diversified plan that will meet our retirement goals or, in some cases, what our goals even are. Ron's book provides valuable insight into forming an effective retirement plan. It discusses all aspects of a truly diverse retirement plan, from identifying retirement goals to explaining the various tools and products available and showing how each can be used in a solid retirement plan. Ron explains the roles that health care, the stock market, annuities, life insurance, Social Security, and estate planning each play in retirement. My favorite aspect of this book is that it provides an understanding of how different types of complex annuities and life insurance policies actually work. This book is worth reading for that alone but it provides much more to help the reader gain a better understanding of retirement planning." - Robert C. Benedict, Esq., Wideikis, Benedict & Berntsson, LLC, The Big W Law Firm
Deciding when and how to retire are among the most important decisions most people make. Can they be depended on to plan with foresight and make sound decisions? According to standard economic analysis the answer is a qualified "yes." But studies by psychologists, sociologists, and economists themselves raise doubts about this comforting appraisal. This volume by analysts trained in economics and other disciplines suggests that retirement planning and decisions fall far short of the rational ideal. Gary Burtless explains what economic research has to say about retirement behavior. Annamaria Lusardi reports that many people in their fifties and older say they have not even thought about retirement. Mathey Rabin and Ted O'Donoghue show that procrastination can cause huge economic losses. Robert Axtell and Joshua Epstein show that herd behavior explains observed patterns of retirement behavior better than does the assumption of rational decisionmaking. George Loewenstein, Drazen Prelec, and Roberto Weber report that many people incorrectly anticipate what retirement will be like and rationalize whatever decision they have made. David Fetherstonhaugh and Lee Ross report experimental evidence that the effect of Social Security provisions may depend on how these policies are "framed" as well as on the specific content of those policies. These and other authors also explore the broader implications of these behavioral patterns. Copublished with Russell Sage Foundation
In 1996, David Cork unleashed a book aimed at financial planning for the boomer generation. The tale of these fictional characters accurately predicted trends and realities to come, inspiring vast numbers of Canadians to read the book and apply to their own lives. Fast-forward to 2004. Boomers are at the halfway point in life, watching their children become adults, experiencing the passing of parents and dealing with unprecedented estate issues. They have worked for twenty years now with likely twenty more to go, and they will likely have as many retirement years as adolescent years. This is a time to take stock. * How will Canadians build and sustain wealth as retirement approaches? * What techniques have worked, what hasn't? * Is this all there is? Never before has a generation attained such wealth, and yet are no happier than any previous generation. * The impact of this large generation is felt by all, future social and financial issues of all Canadians are discussed The Pig and the Python opened our eyes and took the country by storm. As life has continued at breakneck pace, there is a new reality and with Bulls, Bears and Pigs, David Cork once again has the important answers to some very important questions.
Deciding when and how to retire are among the most important decisions most people make. This volume by analysts trained in economics and other disciplines suggests that retirement planning and decisions fall far short of the rational ideal.
The book concludes with three papers analyzing behavior relevant to determining the consequences of trends and policies that alter the economic status of the elderly.
This volumes examines the interaction of labour market conditions and retirement decisions. Based on French and US data, it provides empirical evidence and quantitative analysis of retirement and labor market flows. It studies the horizon effect and uses French individual data and probit models to show that the horizon effect does matter for the probability of being employed before the early retirement age. It analyses the influence of the retirement age on labour-market equilibrium, as well as the impact of labour market conditions, especially the importance of unemployment risk, on retirement decisions.
Do you feel that the stock market is too complex to understand? Have you ever wondered why the stock market goes up when you feel it should go down? Do you lack a framework and strategy for making investment decisions? Are you nearing retirement and concerned about the longevity of your hard-earned assets? Conquering the Bull and the Bear gives you the tools you need to become a lifelong successful investor by providing a framework for making decisions and changing the way you think about investing. This book portrays how the stock market works at its roots-the people, entities, and processes involved in shaping the economic and socio-political landscape combined with a detailed look at the idiosyncrasies of market behavior. No other book brings together seemingly disparate topics such as history, psychology, banking, and politics into a cohesive structure to help you identify key turning points in the stock market so you can be ahead of major moves. A skilled investment advisor, Tim Nguyen shares the principles that have served him well in approaching the market. From having a long-term focus to reading the politics and trends that affect the market, the sound suggestions in Conquering the Bull and the Bear offer clear guidelines to investing and having a secure portfolio in times of downturn and growth. By taking an interdisciplinary approach to understanding the world in which we live and how the stock market reacts in that world, Nguyen gives you the power, perspective, and strategies to help you spot key turning points in the stock market.
