nep-age New Economics Papers
on Economics of Ageing
Issue of 2010‒06‒04
three papers chosen by
Claudia Villosio
LABORatorio R. Revelli

  1. Different Effects of Financial Literacy and Financial Education in Germany By Pahnke, Luise; Honekamp, Ivonne
  2. Gauging the Path of Private Canadian Pensions: 2010 Update on the State of Defined Benefit and Defined Contribution Pension Plans By Kamalesh Gosalia; Elena Simonova; Rock Lefebvre
  3. The Meaning(s) of Happiness By Kamvar, Sep; Mogilner, Cassie; Aaker, Jennifer

  1. By: Pahnke, Luise; Honekamp, Ivonne
    Abstract: Financial literacy or “what consumers know about finance” has become part of the scientific discussion in recent years. In Germany, as in many other countries, the structure of social security benefits has changed substantially. Using the German SAVE study conducted by the Mannheim Institute for the Economics of Aging, in this paper financial literacy in Germany is measured and its effect on private retirement provisions is examined. Therefore, the SAVE data is empirically analysed whether financial literacy has an impact on the retirement savings decision in Germany. With our analysis we were able to prove that financial literacy encourages individual retirement planning for households with an above-average income.
    Keywords: Financial literacy; Retirement savings; Private pensions; Germany; SAVE
    JEL: D14
    Date: 2010–05–09
  2. By: Kamalesh Gosalia (Certified General Accountants Association of Canada); Elena Simonova (Certified General Accountants Association of Canada); Rock Lefebvre (Certified General Accountants Association of Canada)
    Abstract: The issue of under-funded defined benefit (DB) pension plans has become one of the most perplexing financial issues facing business executives, legislators and Canadian pensioners who are or will in the future be reliant on pension income as an important component of their overall retirement incomes. In 2004, CGA-Canada issued a comprehensive paper on defined benefit pension plans titled “Addressing the Pensions Dilemma in Canada”. The goal of that release was to advance understanding of DB pension plans and to impart a reasonable estimate of the standing of DB pension plans at December 31, 2003. In 2009, this analysis was further advanced by examining the funding status of private DB pension plans at December 31, 2008. The results of the analysis show that funding deficits have intensified with funding ratios eroding to unsustainable levels. The vast majority (92%) of private DB pension plans were in a deficit position as at December 31, 2008. The average funding ratio has decreased from 112% to 77% on a ‘without indexation’ basis and from 71% to 57% on a ‘with indexation’ basis. The aggregate funding shortfall is expected to exceed $350 billion.
    Keywords: defined benefit pension plan, defined contribution pension plan, funding postion of pension plans, household savings, retirement savings, retirement income, household finance, pension accounting
    JEL: D14 E21 E22 G23 G28 G11 G12
    Date: 2010–04
  3. By: Kamvar, Sep (Stanford University); Mogilner, Cassie (Stanford University); Aaker, Jennifer (Stanford University)
    Abstract: An examination of emotions reported on 12 million personal blogs along with the results of three experiments reveal that the meaning of happiness is not fixed; instead, it shifts as people age. Whereas younger people are more likely to associate happiness with excitement, older people are more likely to associate happiness with feeling peaceful. This change is driven by increased feelings of connectedness (to others and to the present moment) as one ages.
    Date: 2009–05

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