Retirement Security Research Articles

Financial Security in Retirement: The Importance of Savings vs Earnings in Malaysia

Financial Security in Retirement: The Importance of Savings vs Earnings in Malaysia

Optimal allocation for stock market-excluded retirees: Effects of interest rates, longevity risk, and upfront fees

This paper studies the decision-making dynamics of stock market-excluded retirees, focusing on the optimal allocation of retirement wealth among consumption, risk-free assets, and single premium immediate annuities. The analysis centers on two pivotal factors: insurer interest rates and longevity risk. The study introduces new dimensions by highlighting the modeled financial environment’s optimal investment–consumption-annuitization profiles under different market scenarios. Additionally, insights on the low demand for life annuities are offered, attributing a significant part to the impact of upfront fees. Employing a life-cycle consumption framework, the paper advocates adopting a commission-free model, enabling registered investment advisors to market annuities with periodic assets under management fees to revitalize annuity demand and bolster retirement security.

Trends in the retirement security of Black and Hispanic households in the US: A setback for Black Americans but continued progress for Hispanics

Retirement income security refers to the ability of households to provide an adequate stream of income during the period of their retirement from the labor force. Expected retirement income is based of four components: (i) standard non-pension wealth holdings, (ii) defined contribution (DC) pension holdings, (iii) actual or expected defined benefit (DB) pension entitlements, and (iv) actual or expected Social Security benefits. The first two components are converted into an annuity. All the data (except rates of return) for these calculations are available from the Survey of Consumer Finances. Results indicate that both Black and Hispanic households made remarkable progress in terms of mean and median retirement income, poverty reduction, and replacement rates from 1989 to 2007 in both absolute terms and relative to whites. However, for Black households, this was followed by a reversal of fortune from 2007 to 2019, with expected median retirement income declining, the projected poverty rate rising, and the projected replacement rate falling, though expected mean retirement income does rise. Hispanics also experienced a setback in mean retirement income but continued progress in replacement rates and reducing poverty from 2007 to 2019.

Bonds and Pensioning Scheme

The abstract provides an overview of national bonds and pension schemes. National bonds, issued by governments, offer investors a safe investment option with fixed or variable interest rates. They are used to finance government projects and are considered less risky than corporate bonds due to government backing. However, they carry risks such as interest rate and inflation risks. Pension schemes are essential for retirement planning, but their structure and benefits vary. Individuals should assess their options and supplement pensions with additional savings for a secure retirement. Key Words: Retirement planning, Pension schemes, Government debt.

How Federal Government Policy Helped Create Retirement Insecurity

Financial security in retirement is crucial. Without it, people fall into poverty, work until they die, and die younger than they should. In the 21st century, Americans fund their retirement from Social Security, traditional pension plans, defined contributions plans and private retirement savings plans. Of these four, only Social Security is exclusively the creature of government. Nevertheless, federal law regulates the other three to such an extent that it is fair to say that all four reflect government retirement policy. Since 1974, the federal government has spent billions of dollars supporting the private retirement system. In turn, the private retire-ment system has often failed its participants, sometimes leaving them impoverished. In contrast, Social Security has consistent success in reducing poverty and providing a financially strong old age. The last 50 years demonstrate that the private sector is an unre-liable provider of retirement benefits. Private employers deny their workers retirement benefits, siphon off pension monies for corporate use and declare bankruptcy as a means of leaving their losses to the fed-eral government to make right. In turn, the federal government must spend even more money regulating the private sector and protecting pri-vate workers and their retirement monies. Whatever the theories, we have decades of proof that if the federal government wants to ensure financial security for the elderly, then it should stop providing tax ben-efits and direct payments to private sector retirement plans and instead focus on expanding and strengthening Social Security.

Sociodemographic Factors and Policy Implications for Improved Food Security

Ensuring food security is a pressing challenge facing East Kalimantan, and practical solutions are necessary. With the impending relocation of Indonesia's capital to this region, it's crucial to evaluate the area's food security in light of projected population growth and economic shifts. Prior to the new capital city project, it's essential to understand East Kalimantan's socio-economic factors to develop policies that strengthen food security for the future. This research uses logistic regression to analyze data from the Food Insecurity Experience Scale (FIES) module of the 2021 National Socio-Economic Survey (Susenas-BPS). The results show that 14.75% of households experience food insecurity, while 85.25% maintain food security. Factors such as education, family size, land ownership, marital status, employment, residence, and retirement security influence food security status significantly. However, age, gender, and home ownership have little impact. Notably, agricultural workers are more likely to experience food insecurity, while education and land ownership correlate with higher food security. Additionally, larger families are more vulnerable to food insecurity.

독거노인의 대인관계 및 사회적 지원요인이 삶의 만족도에 미치는 영향

This study aims to verify the effects of interpersonal relationships and social support factors on the life satisfaction of elderly people over 65 years old divided into three age groups while using Carstensen & Charles' Social Emotional Selection Theory as a foundation. Data from the 8th year supplementary survey of the National Retirement Security Panel (KReIS) were used, and the data of 1,117 elderly people aged 65 years of age or older who were living alone were extracted and analyzed. First, there were differences in educational background, number of children, economic activity, and average monthly income among the examined age groups. Interpersonal relationships, social support factors, and life satisfaction were also all found to differ between the three age groups. Second, it was confirmed that higher social support factors were associated with higher life satisfaction in all age groups. This study is meaningful in that it analyzed the effects of interpersonal relationships and social support factors on life satisfaction according to the characteristics of each age group of elderly people living alone, and based on these results, this study suggested practical intervention measures for social welfare as well as follow-up studies that should be conducted to improve life satisfaction among elderly people living alone

An analysis of how Millennials view social security

Objective: To identify and analyze how Millennials view social security.
 Methodology: A survey consisting of a 21- question structured questionnaire developed on the LimeSurvey® tool and sent to approximately 15 thousand people from all regions of Brazil. The respondents were selected on an open basis and according to the age group of this generation. The non-parametric Chi-Square test was performed for each question in the structured questionnaire to verify differences in the evaluation of the control variables.
 Results: Contrary to the analyzed study bases, most Brazilian Millennials in the survey think or are concerned about their retirement. One hypothesis based on the research findings is that Millennials are concerned about their retirements and believe that achieving a secure retirement will be a very complicated task in the future. Despite the low number of supplementary pensions among Millennials, most claim to have a high level of interest in it, and contribute to the literature on the subject.
 Study contributions: In addition to furthering the understanding of how Millennials deal with social security, this study can contribute to the development of public policies aimed at educating young people on social security.

Addressing Infrastructure Funding and Retirement Security through Islamic Finance: Sukuk SeLFIES

Addressing Infrastructure Funding and Retirement Security through Islamic Finance: Sukuk SeLFIES

AGING AND FOREIGN POLICY: EXPERIENCING THE GLOBAL TRACK OF THE HEALTH AND AGING POLICY FELLOWSHIP

Abstract The Health and Aging Policy Fellowship includes a Global Track that provides fellows with the opportunity to shape global policy or U.S. foreign policy for an aging society. The author, a global health expert and 2022-2023 fellow, sought a fellowship placement with a member of Congress with jurisdiction over U.S. global health policy. Although global health is a significant foreign policy priority for the U.S. government, U.S. global health programs do not include dedicated funding for activities designed to benefit older adults or help development partners adapt to population aging. The result is that US-funded programs on issues from infectious disease to health systems strengthening to disaster relief lack a focus on older adults, despite their many links to this growing population. To help address this policy gap, the author secured a fellowship placement with Senator Benjamin Cardin (D-MD), a senior member of the Senate Foreign Relations Committee (SFRC) and Chair of the SFRC Subcommittee overseeing the State Department, US Agency for International Development, and bilateral development assistance. With his track record of legislation and oversight on issues such as Medicare, health disparities, medical research, oral health, health systems strengthening, and retirement security, Senator Cardin is well positioned to help integrate the needs of older adults into U.S. development assistance. The author used his fellowship year to help advance the global health-related legislative priorities of Senator Cardin and his Health Team, bringing his expertise and perspective on aging to the policy table while gaining invaluable skills in the policy process.

Older Workers and Retirement Security: A Review

Older Workers and Retirement Security: A Review

Retirement Planning: A Brief Snapshot Of The Demographic Factors Influencing The Choice Of Investments For Planning Your Retirement

Establishing a comfortable life in retirement from a personal and financial outlook is a very intricate exercise that calls for careful planning and years of perseverance. Retirement strategy differs from other forms of investment strategies given that it empowers people to have financial independence and, consequently, lead a contented and happy life even when they are not working. From this perspective, it becomes evident that being poorly prepared in terms of finances for retirement might only diminish the value of a retired life. When it comes to retirement planning, there are a number of factors that can influence one's investment choices. It is important to carefully consider these factors in order to make informed decisions and ensure long-term financial stability. By taking a thoughtful and strategic approach to retirement planning, individuals can best position themselves for a comfortable and secure retirement. The primary intention of this paper is to offer a brief literature review by focusing on several factors which influence the financial strategies and investment plan of people for their post-retirement lives. The current study seeks to look into why some persons are capable of planning for retirement while others are unable to do so. The factors that influenced the decisions regarding retirement planning were found to be age, gender, marital status, education and income. The most significant factor that explained the diversity in retirement savings of people turned out to be the income and education. The retirement planning and financial preparedness of households with greater levels of education and income were revealed to be superior. The study revealed that young people and women trailed behind in their retirement preparation and are less conscious of it.

Sustaining Retirement during Lockdown: Annuitized Income and Older American’s Financial Well-Being before and during the COVID-19 Pandemic

The landscape of employer-sponsored retirement plans in the U.S. has changed dramatically during the past few decades as more and more private-sector employers have decided to freeze or terminate traditional pension plans. Defined contribution (DC) plans became the primary choice or the only choice for employees to participate in employer-sponsored retirement plans. In the next ten to twenty years, the income from pension plans will only count for a third of the total retirement income for GenXers when compared to their baby boomer counterparts. It is important for research to provide evidence on how the change in retirement income resources impacts retirees’ retirement security and financial wellness. Using Health and Retirement Study (HRS) data before and during the COVID-19 pandemic, this study examines the association between annuitized income and various measures of older Americans’ financial well-being over time, particularly during the pandemic. This study finds that receiving annuitized income has a statistically significant relationship with reduced subjective financial well-being for both measurements, while only one of the measures of objective well-being, having liquid assets greater than the median household income, has a statistically significant positive relationship with receiving annuitized income.

Investment and Retirement Planning – A Conceptual Analysis

Purpose: The aim of this study is to examine the intricate interplay between investment strategies and retirement planning through a comprehensive conceptual analysis. This study aims to provide a holistic conceptual analysis that guides sound financial decision-making for a secure and fulfilling retirement by thoroughly examining the complex relationship between investment strategies and retirement planning and drawing conclusions from empirical investment and retirement theories.
 
 Theoretical framework: The research draws upon a multidisciplinary approach, integrating theories from finance, economics, and psychology to develop conceptual understanding that illuminates the complex dynamics influencing individuals' investment decisions within the context of retirement planning.
 
 Approach: Employing a qualitative research design, this study utilizes an extensive literature review and content analysis of scholarly articles, reports, and expert opinions to develop a nuanced understanding of the factors shaping investment behaviors and retirement preparedness.
 
 Findings: The results of this analysis highlight the critical role of risk tolerance, financial literacy, psychological biases, and socio-economic factors in shaping individuals' investment choices and retirement planning strategies. Moreover, the study underscores the significance of early and strategic investment decisions in ensuring a financially secure retirement.
 
 Research, practical & social implications: Research, Practical & Social implications: The study's insights offer a valuable resource for financial advisors, policymakers, and individuals seeking to optimize their investment and retirement strategies. By elucidating the underlying mechanisms driving investment behavior, the research informs the development of tailored advice, educational initiatives, and policy interventions that enhance retirement preparedness and overall financial well-being.
 
 Originality/Value: Furthermore, the study contributes to a broader societal understanding of the implications of investment choices on individuals' long-term financial security, thus fostering a more financially resilient aging population. Originality/value: The value of the study lies in its holistic approach to dissecting the intricacies of investment decisions within the realm of retirement planning. By synthesizing diverse theoretical perspectives, this research offers a comprehensive framework for comprehending the multifaceted factors that influence investment behaviors and retirement outcomes. The study's unique contribution lies in its ability to bridge the gap between academic research and practical application, providing actionable insights that have the potential to drive positive financial behaviors and reshape retirement planning paradigms.

Early pension withdrawals in Chile during the pandemic

Abstract At the onset of the Covid-19 crisis, and with one of the largest and best-funded defined contribution programs in Latin America, Chile held over USD $200 bn in assets (or more than 80% of GDP). Reacting to populist pressures during the pandemic, however, the Congress gave non-retired participants three separate opportunities to tap into their retirement accounts, leaving some 4.2 million participants with zero retirement savings and draining around $50 bn from the system. This paper explores several hypotheses regarding why people withdrew their pension money early, and it also presents evidence regarding the likely impact of this short-term policy on long-term retirement wellbeing. We conclude with lessons for global policymakers seeking to protect pension assets critical for retirement security.

The impact of post‐retirement financial market participation on retirement income sufficiency in Australia

AbstractUsing HILDA survey data, we document a strong positive relationship between post‐retirement financial market participation and retiree income sufficiency in Australia. We find a 17% improvement in the income replacement ratio and a 3.26 times higher annuitised net wealth for financial market participants compared to non‐participants. We further investigate how age, residence area, relationship status, education, health, and employment affect the main finding in all and female retirees. The results highlight the value of financial market participation in facilitating household retirement security and provide further support for the active promotion of household financial market participation, both in Australia and globally.

Understanding The Role of Psychological Characteristics in Retirement Planning Among Employees Working in Delhi NCR.

The transition towards retirement needs coping and adapting, both of which provide challenges to psychological health. Notably, the transition into retirement sheds light on the core definition of psychological ageing, which may be summed up as the capacity to adapt not only to internal biological changes but also to changes in the external environment, which can have an impact on psychological health. The ability to adapt not only to internal biological changes but also to changes in the external environment that can have an impact on psychological health is central to the concept of psychological ageing. Since people are becoming more conscious that having financial security in retirement is only one of many crucial factors, there has been a rise in interest in the psychological aspects of retirement. It is highly likely that retirees will struggle with at least some psychological disorders, the severity of which will vary. For instance, a married couple whose ages are widely different but who both work full-time could wonder if they should retire at the same time or wait until one of them reaches a certain milestone age. While one person worked, the other might retire and spend their time relaxing at home by themselves. When faced with such a situation, retirees are prone to have psychological issues, which, in order to achieve their highest possible level of life satisfaction, need to be addressed. The purpose of this study was to investigate how psychological factors influence the retirement planning behaviour of employees in the Delhi National Capital Region. This article examines the challenges that many leaders face when it comes time for them to step down from their positions. It analyses the physical and psychological aspects of ageing and discusses a number of the obstacles that stand in the way of a graceful exit, including financial, social, and psychological factors. In addition to this, it delves into a variety of mental processes that come into play during retirement.
 

Crossroads Car Wash: When Family and Finances Collide

ABSTRACT This case allows students to apply managerial accounting knowledge in a practical, real-world setting. Integrating both financial and nonfinancial considerations, students are charged with making a recommendation to the Garcias, the owners of a family-owned and operated car wash (Crossroads), who are forced to make a difficult decision between a financially secure retirement or continuing to operate the business that supports their children and at-risk employees. This case can be used as is or modified for use in undergraduate/graduate managerial accounting courses and is intended to challenge students (1) to use managerial accounting knowledge and concepts to identify issues and relevant costs, (2) to understand the challenges and risks associated with selling a family-owned business, (3) to apply managerial accounting skills to the decision-making process, and (4) to analyze, synthesize, and evaluate financial and nonfinancial considerations to make a recommendation on selling or continuing to operate a family-owned small business.

Compassionate Capitalism: Understanding the Juxtaposition of Personal Gain and Concern for Others

This article explores the concept of Compassionate Capitalism, which involves creating sustainable business models benefiting society and employees. Through Compassionate Capitalism, business owners can build trust with their customers and stakeholders, and in turn, enhance their long-term profitability through the Employee Stock Ownership Plan (ESOP) structure. The article also discusses the historical perspectives on Capitalism and articulates how Capitalism can coexist with compassion. It highlights the ESOP as a present-day example of Compassionate Capitalism, where employees are given a financial stake in the company for which they are employed. ESOPs redistribute ownership to the workforce and create a unique form of Capitalism that continues a successful company’s tradition. The ESOP benefits the younger members of a company, enhances retirement security, and creates a sense of ownership among employees. The article explains how employee ownership can align the interests of workers with those of management, creating a more collaborative, equitable workplace, contributing to greater overall economic growth. This article includes a case study examining a defense contractor's decision to become an employee-owned company through an ESOP transaction in 2010. The ESOP consulting firm, Executive Financial Services (EFS), provided a feasibility analysis and implementation for the transaction. Over the next decade, the company grew rapidly and eventually sold for $1.6 billion in 2020, creating hundreds of millionaires among the ESOP participants. This decision exemplifies the Compassionate Capitalism model, where the owners chose to honor and support the employees who helped build the company, creating generational wealth opportunities for myriad families. The decision to become an employee-owned company through an ESOP transaction shows that Capitalism and compassion can be compatible.

AACAP tells Senate help is needed to boost child and adolescent treatment workforce

At a May 17 hearing by the U.S. Senate Committee on Health, Education, Labor, and Pensions Subcommittee on Primary Health and Retirement Security, AACAP president Warren Y.K. Ng, M.D. pleaded with legislators for more treatment providers for young people with mental health problems.