Arbeitspapier

Fixed and variable longevity annuities in defined contribution plans: Optimal retirement portfolios taking social security into account

This paper investigates retirees' optimal purchases of fixed and variable longevity income annuities using their defined contribution (DC) plan assets and given their expected Social Security benefits. As an alternative, we also evaluate using plan assets to boost Social Security benefits through delayed claiming. We determine that including deferred income annuities in DC accounts is welfare enhancing for all sex/education groups examined. We also show that providing access to well-designed variable deferred annuities with some equity exposure further enhances retiree wellbeing, compared to having access only to fixed annuities. Nevertheless, for the least educated, delaying claiming Social Security is preferred, whereas the most educated benefit more from using accumulated DC plan assets to purchase deferred annuities.

Sprache
Englisch

Erschienen in
Series: CFS Working Paper Series ; No. 684

Klassifikation
Wirtschaft
Portfolio Choice; Investment Decisions
Insurance; Insurance Companies; Actuarial Studies
Household Saving; Personal Finance
Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡
Thema
lifecycle saving
retirement plan
annuity
longevity
delayed claiming
household finance

Ereignis
Geistige Schöpfung
(wer)
Horneff, Vanya
Maurer, Raimond
Mitchell, Olivia S.
Ereignis
Veröffentlichung
(wer)
Goethe University Frankfurt, Center for Financial Studies (CFS)
(wo)
Frankfurt a. M.
(wann)
2023

Handle
URN
urn:nbn:de:hebis:30:3-680241
Letzte Aktualisierung
10.03.2025, 11:44 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Horneff, Vanya
  • Maurer, Raimond
  • Mitchell, Olivia S.
  • Goethe University Frankfurt, Center for Financial Studies (CFS)

Entstanden

  • 2023

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