Annuity Valuation, Long-Term Care, and Bequest Motives

John Ameriks; Andrew Caplin; Steven Laufer; Stijn Van Nieuwerburgh

doi:10.1093/acprof:oso/9780199549108.003.0011

Annuity Valuation, Long-Term Care, and Bequest Motives

John Ameriks, Andrew Caplin, Steven Laufer, Stijn Van Nieuwerburgh

Research output: Chapter in Book/Report/Conference proceeding › Chapter

Abstract

Financial security in retirement has traditionally meant having a steady flow of annuity income as long as one lives - a definition enshrined in the Social Security system. Earlier research has stressed a more holistic approach, which focuses on the match between resources and spending needs. Using this formulation this chapter estimates annuity values given long-term care concerns and bequest motives, where these estimated values are consistent with low observed demand for standard annuities. The chapter extends this model to value non-standard annuities with various security-enhancing features that may be of value to retirees.

Original language	English (US)
Title of host publication	Recalibrating Retirement Spending and Saving
Publisher	Oxford University Press
ISBN (Electronic)	9780191720734
ISBN (Print)	9780199549108
DOIs	https://doi.org/10.1093/acprof:oso/9780199549108.003.0011
State	Published - Jan 1 2009

Keywords

Bequest
Consumption
Health shock
Healthcare
Long-term-care insurance
Longevity insurance
Medicaid aversion
Precautionary motive
Reversible annuity

ASJC Scopus subject areas

General Business, Management and Accounting

Access to Document

10.1093/acprof:oso/9780199549108.003.0011

Cite this

@inbook{2fbb533f236046e6a52543501b10dfbf,

title = "Annuity Valuation, Long-Term Care, and Bequest Motives",

abstract = "Financial security in retirement has traditionally meant having a steady flow of annuity income as long as one lives - a definition enshrined in the Social Security system. Earlier research has stressed a more holistic approach, which focuses on the match between resources and spending needs. Using this formulation this chapter estimates annuity values given long-term care concerns and bequest motives, where these estimated values are consistent with low observed demand for standard annuities. The chapter extends this model to value non-standard annuities with various security-enhancing features that may be of value to retirees.",

keywords = "Bequest, Consumption, Health shock, Healthcare, Long-term-care insurance, Longevity insurance, Medicaid aversion, Precautionary motive, Reversible annuity",

author = "John Ameriks and Andrew Caplin and Steven Laufer and {Van Nieuwerburgh}, Stijn",

year = "2009",

month = jan,

day = "1",

doi = "10.1093/acprof:oso/9780199549108.003.0011",

language = "English (US)",

isbn = "9780199549108",

booktitle = "Recalibrating Retirement Spending and Saving",

publisher = "Oxford University Press",

}

TY - CHAP

T1 - Annuity Valuation, Long-Term Care, and Bequest Motives

AU - Ameriks, John

AU - Caplin, Andrew

AU - Laufer, Steven

AU - Van Nieuwerburgh, Stijn

PY - 2009/1/1

Y1 - 2009/1/1

N2 - Financial security in retirement has traditionally meant having a steady flow of annuity income as long as one lives - a definition enshrined in the Social Security system. Earlier research has stressed a more holistic approach, which focuses on the match between resources and spending needs. Using this formulation this chapter estimates annuity values given long-term care concerns and bequest motives, where these estimated values are consistent with low observed demand for standard annuities. The chapter extends this model to value non-standard annuities with various security-enhancing features that may be of value to retirees.

AB - Financial security in retirement has traditionally meant having a steady flow of annuity income as long as one lives - a definition enshrined in the Social Security system. Earlier research has stressed a more holistic approach, which focuses on the match between resources and spending needs. Using this formulation this chapter estimates annuity values given long-term care concerns and bequest motives, where these estimated values are consistent with low observed demand for standard annuities. The chapter extends this model to value non-standard annuities with various security-enhancing features that may be of value to retirees.

KW - Bequest

KW - Consumption

KW - Health shock

KW - Healthcare

KW - Long-term-care insurance

KW - Longevity insurance

KW - Medicaid aversion

KW - Precautionary motive

KW - Reversible annuity

UR - http://www.scopus.com/inward/record.url?scp=84920169036&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84920169036&partnerID=8YFLogxK

U2 - 10.1093/acprof:oso/9780199549108.003.0011

DO - 10.1093/acprof:oso/9780199549108.003.0011

M3 - Chapter

AN - SCOPUS:84920169036

SN - 9780199549108

BT - Recalibrating Retirement Spending and Saving

PB - Oxford University Press

ER -

Annuity Valuation, Long-Term Care, and Bequest Motives

Abstract

Keywords

ASJC Scopus subject areas

Access to Document

Other files and links

Fingerprint

Cite this