Financial Regret at Older Ages and Longevity Awareness

Posted: 22 Nov 2022 Last revised: 18 Oct 2023

See all articles by Abigail Hurwitz

Abigail Hurwitz

Hebrew University, Jerusalem Israel

Olivia S. Mitchell

University of Pennsylvania - The Wharton School, Pension Research Council; University of Pennsylvania - The Wharton School; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: December 6, 2022

Abstract

Many older people express regret about undersaving; here, we extend prior work by reporting regret about five other critical financial topics. Using the Health and Retirement Study, we first show that older people who regret past financial decisions differ significantly from those who do not. Second, in an experiment, we demonstrate that informing people about objective survival probabilities increases regret about not buying lifetime income by 42% overall, and by more among the high income or those in good health. We also document that, for some, providing such information increases regret about having claimed social security early and undersaving. These results may explain previous findings about why survival information can alter financial decisions.

Keywords: retirement, insurance, benefit claiming, annuitization, financial dependence

JEL Classification: D14, D15, D83, G22, G41, G51

Suggested Citation

Hurwitz, Abigail and Mitchell, Olivia S., Financial Regret at Older Ages and Longevity Awareness (December 6, 2022). Wharton Pension Research Council Working Paper No. 2022-25, Available at SSRN: https://ssrn.com/abstract=4283158 or http://dx.doi.org/10.2139/ssrn.4283158

Abigail Hurwitz (Contact Author)

Hebrew University, Jerusalem Israel ( email )

Mount Scopus
Jerusalem, 91905
Israel

Olivia S. Mitchell

University of Pennsylvania - The Wharton School, Pension Research Council ( email )

3302 Steinberg Hall-Dietrich Hall
3620 Locust Walk
Philadelphia, PA 19104-6302
United States

University of Pennsylvania - The Wharton School ( email )

Philadelphia, PA 19104-6365
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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