Individuals’ Uncertainty about Future Social Security Benefits and Portfolio Choice

42 Pages Posted: 22 Sep 2010

See all articles by Adeline Delavande

Adeline Delavande

New University of Lisbon - Faculdade de Economia

Susann Rohwedder

RAND Corporation

Multiple version iconThere are 2 versions of this paper

Date Written: September 21, 2010

Abstract

Little is known about the degree to which individuals are uncertain about their future Social Security benefits, how this varies within the U.S. population, and whether this uncertainty influences financial decisions related to retirement planning. To illuminate these issues, the authors present empirical evidence from the Health and Retirement Study Internet Survey and document systematic variation in respondents’ uncertainty about their future Social Security benefits by individual characteristics. They find that respondents with higher levels of uncertainty about future benefits hold a smaller share of their wealth in stocks.

Keywords: expectations, portfolio choice, subjective probabilities, uncertainty, Health and Retirement Study

JEL Classification: G11, D14, D81, D01

Suggested Citation

Delavande, Adeline and Rohwedder, Susann, Individuals’ Uncertainty about Future Social Security Benefits and Portfolio Choice (September 21, 2010). RAND Working Paper Series WR- 782, Available at SSRN: https://ssrn.com/abstract=1680643 or http://dx.doi.org/10.2139/ssrn.1680643

Adeline Delavande (Contact Author)

New University of Lisbon - Faculdade de Economia ( email )

Campus de Campolide
Lisboa, 1099-032
Portugal
+35 1 21 380 16 00 (Phone)
+35 1 21 387 09 33 (Fax)

HOME PAGE: http://docentes.fe.unl.pt/~adeline/page2.html

Susann Rohwedder

RAND Corporation ( email )

P.O. Box 2138
1776 Main Street
Santa Monica, CA 90407-2138
United States

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