Age Pensioner Profiles: A Longitudinal Study of Income, Assets and Decumulation

ARC Centre of Excellence in Population Ageing Research Working Paper 2015/17

43 Pages Posted: 12 Oct 2016

See all articles by Shang Wu

Shang Wu

Aware Super

Anthony Asher

University of New South Wales (UNSW) - School of Actuarial Studies

Ramona Meyricke

UNSW Australia Business School, School of Risk & Actuarial Studies; CEPAR, University of New South Wales; Swiss Re, Australia

Susan Thorp

The University of Sydney Business School

Date Written: December 1, 2014

Abstract

Using eight years of data drawn from the records of Australia’s Centrelink agency, we describe the income, asset and decumulation patterns of over 10,000 age pensioners. Analysis of this longitudinal data set shows that age pensioners, on average, preserve both financial and residential wealth, consuming conservatively and, ultimately, passing on substantial bequests. While younger households do run down financial wealth early in retirement, older households generally maintain their assessable asset balances, and some even manage to save. The largest falls in assets are linked to changes in household structure due to death or the breakdown of a relationship. So, as in many other developed countries, age pensioners in Australia appear to ‘under-consume’, holding on to assets, and even building a buffer, well into their later years.

Keywords: Retirement Wealth, Life-Cycle Saving, Public Pension, Portfolio Choice

JEL Classification: D91, E21, G11

Suggested Citation

Wu, Shang and Asher, Anthony and Meyricke, Ramona and Thorp, Susan, Age Pensioner Profiles: A Longitudinal Study of Income, Assets and Decumulation (December 1, 2014). ARC Centre of Excellence in Population Ageing Research Working Paper 2015/17, Available at SSRN: https://ssrn.com/abstract=2850245 or http://dx.doi.org/10.2139/ssrn.2850245

Shang Wu

Aware Super ( email )

388 George St
Sydney, NSW 2000
Australia

Anthony Asher (Contact Author)

University of New South Wales (UNSW) - School of Actuarial Studies ( email )

Sydney, NSW 2052
Australia
612 9385 7619 (Phone)

HOME PAGE: http://www.asb.unsw.edu.au/schools/Pages/AnthonyAsher.aspx

Ramona Meyricke

UNSW Australia Business School, School of Risk & Actuarial Studies ( email )

Room 2058 South Wing 2nd Floor
Quadrangle building, Kensington Campus
Sydney, NSW 2052
Australia

CEPAR, University of New South Wales ( email )

Level 6, Central Lobby (enter via East Lobby)
Australian School of Business Building
Sydney, New South Wales NSW 2052
Australia

Swiss Re, Australia ( email )

363 George St
Sydney, NSW 2000
Australia

Susan Thorp

The University of Sydney Business School ( email )

Abercrombie Building
H70
The University Of Sydney, NSW 2006
Australia
0290366354 (Phone)

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