Right Before the End: Asset Decumulation at the End of Life

Abstract

Using data from the Asset and Health Dynamics of the Oldest Old survey, the authors find that the assets of people who die decline much faster than the assets of people who survive, even after controlling for age, sex, and initial asset levels. Out-of-pocket medical expenses right before death can deplete the assets of many elderly households and constitute an important reason to keep assets in old age.

Keywords: asset decumulation, death, medical expenditures, Macroeconomics: Consumption, Saving, Aggregate Physical and Financial Consumer Wealth, Economics of the Elderly, Economics of the Handicapped