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Evening Talk

Longevity Awareness and Financial Decision Making

Many people do not understand the concepts of life expectancy and longevity risk, potentially leading them to under-save for retirement or not to purchase longevity insurance, which can lead to regret at older ages. We investigate alternative ways to increase the salience of both concepts, allowing us to assess whether these change peoples’ perceptions and financial decision making. Using randomly-assigned vignettes providing subjects with information about either life expectancy or longevity, we show that merely prompting people to think about financial decisions changes their perceptions regarding subjective survival probabilities. Moreover, this information also boosts respondents’ interest in saving and demand for longevity insurance. In particular, longevity information influences both subjective survival probabilities and financial decisions, while life expectancy information influences only annuity choices. We also investigate whether better longevity information changes peoples’ financial regrets in later life. 

Seminar Room 3-1
Level 3, Manasseh Meyer Building
Lee Kuan Yew School of Public Policy

 
Wed 23 August 2023
06:00 PM - 07:30 PM

Prof. Olivia S. Mitchell

Prof. Olivia S. Mitchell

International Foundation of Employee Benefit Plans Professor, Professor of Business Economics & Public Policy, The Wharton School of the University of Pennsylvania

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Asst. Prof. Joelle H. Fong

Asst. Prof. Joelle H. Fong

Assistant Professor (Economics & Public Policy), Lee Kuan Yew School of Public Policy

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