Who Among the Elderly Owns Stocks? The Role of Cognitive Ability and Bequest Motive

Journal of Family and Economic Issues, SpringerLink, 2012

27 Pages Posted: 20 Feb 2012 Last revised: 8 Aug 2019

See all articles by Eunjin Kim

Eunjin Kim

CNK Consulting Inc

Sherman D. Hanna

Ohio State University (OSU)

Swarn Chatterjee

University of Georgia

Suzanne Lindamood

Independent

Date Written: January 25, 2012

Abstract

Conventional advice is to reduce risky investments as one ages. Such a generalized focus on risk avoidance may be inappropriate for elderly with longer life spans and those with financial goals that extend beyond their lifetime. To better understand risky asset holdings among the elderly, we investigated the effect of cognitive ability and bequest motive on stock ownership and stock purchase. Using the 2004 wave of the Health and Retirement Study, we found that one-third of elderly households held stocks and 36% of those elderly stockowners had recently acquired stocks. The respondent’s cognitive ability and bequest motive were strongly related to stock ownership. Among those who owned stock, a bequest motive was positively related to a recent purchase of stocks.

Keywords: Elderly, Stock ownership, Cognitive ability, Bequest motive

JEL Classification: D14, G11, J26

Suggested Citation

Kim, Eunjin and Hanna, Sherman D. and Chatterjee, Swarn and Lindamood, Suzanne, Who Among the Elderly Owns Stocks? The Role of Cognitive Ability and Bequest Motive (January 25, 2012). Journal of Family and Economic Issues, SpringerLink, 2012. Available at SSRN: https://ssrn.com/abstract=2007937

Eunjin Kim

CNK Consulting Inc ( email )

3rd floor Dana Building, 795-24,
BangbaeBon-Dong,
Seoul
Korea, Republic of (South Korea)

Sherman D. Hanna (Contact Author)

Ohio State University (OSU) ( email )

1787 Neil Avenue
Campbell 265D
Columbus, OH 43210
United States
614-292-4584 (Phone)

Swarn Chatterjee

University of Georgia ( email )

Athens, GA 30602-3622
United States

Suzanne Lindamood

Independent ( email )

No Address Available

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