What is an adequate standard of living during retirement?

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URL:	https://ub-madoc.bib.uni-mannheim.de/2391
URN:	urn:nbn:de:bsz:180-madoc-23915
Document Type:	Working paper
Year of publication:	2008
The title of a journal, publication series:	Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung
Volume:	08-48
Place of publication:	Mannheim
Publication language:	English
Institution:	School of Law and Economics > Sonstige - Fakultät für Rechtswissenschaft und Volkswirtschaftslehre
MADOC publication series:	Sonderforschungsbereich 504 > Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung (Laufzeit 1997 - 2008)
Subject:	330 Economics
Classification:	JEL: D91 H55 ,
Subject headings (SWD):	USA , Niederlande , Altersversorgung , Lebensstandard , Rentner
Keywords (English):	Life cycle preferences , pension reform , replacement rates , retirement saving
Abstract:	Many economists and policy-makers argue that households do not save enough to maintain an adequate standard of living during retirement. However, there is no consensus on the answer to the underlying question what this standard should be, despite the fact that it is crucial for the design of saving incentives and pension reforms. We address this question with a randomized survey design, individually tailored to each respondent's financial situation, and conducted both in the U.S. and the Netherlands. Key findings are that adequate levels of retirement spending exceed 80 percent of working life spending for a majority of respondents, minimum acceptable replacement rates depend strongly on income, and households in the Netherlands are much more risk averse than U.S. households.