An Examination of Retirement Income Adequacy Measures and Factors Affecting Retirement Preparedness

41 Pages Posted: 23 Sep 2008 Last revised: 5 Oct 2010

See all articles by Cassandra R. Cole

Cassandra R. Cole

Florida State University - College of Business

Andre P. Liebenberg

University of Mississippi - School of Business Administration

Date Written: September 19, 2008

Abstract

This article uses a consistent methodology to estimate several retirement income adequacy measures for households that participate in two national surveys. In addition, we examine the impact of a variety of factors on retirement preparedness. We find that Survey of Consumer Finances households have higher income replacement rates, but lower consumption replacement rates, than Health and Retirement Survey households. We also find that replacement rate estimates are sensitive to the treatment of home equity and assumed retirement age. Finally, the impact of household characteristics on the likelihood of being better prepared for retirement differs depending on the survey data and retirement income adequacy measure used.

Keywords: Retirement Income Adequacy, Survey of Consumer Finances, Health and Retirement Survey

JEL Classification: H31, H55, J26

Suggested Citation

Cole, Cassandra R. and Liebenberg, Andre P., An Examination of Retirement Income Adequacy Measures and Factors Affecting Retirement Preparedness (September 19, 2008). Available at SSRN: https://ssrn.com/abstract=1272067 or http://dx.doi.org/10.2139/ssrn.1272067

Cassandra R. Cole

Florida State University - College of Business ( email )

423 Rovetta Business Building
Tallahassee, FL 32306-1110
United States

Andre P. Liebenberg (Contact Author)

University of Mississippi - School of Business Administration ( email )

PO Box 3986
Oxford, MS 38677
United States

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