Calculating Savings Rates in Working Years Needed to Maintain Living Standards in Retirement
Benefits Quarterly, Vol. 25, No. 3, pp. 31-42, 2009
16 Pages Posted: 18 Dec 2008 Last revised: 29 Sep 2009
Date Written: November 19, 2008
We establish an empirically based lifecycle model to gauge savings and replacement rates for maintaining a steady living standard over life. We consider a variety of scenarios and demonstrate that savings rates vary substantially with individuals' economic and demographic situations as well as retirement plan provisions. This result highlights that meaningful retirement planning must be specific to individuals or households and be based on a comprehensive knowledge of living means and needs.
Keywords: Defined Contribution (DC), Defined Benefit (DB), Savings and Replacement Rates, Living Standard
JEL Classification: J26, D91, D12, D14
Suggested Citation: Suggested Citation