The Effects of Marital Status and Children on Savings and Portfolio Choice

Posted: 25 Jan 2010

See all articles by David A. Love

David A. Love

Williams College - Department of Economics

Abstract

This paper investigates the impact of demographic shocks on optimal decisions about saving, life insurance, and, most centrally, asset allocation. The analysis indicates that marital-status transitions can have important effects on optimal household decisions, particularly in the cases of widowhood and divorce. Children also play a fundamental role in portfolio choice; in addition to leading to substantially different average allocations, they also have strong interaction effects with changes in marital status. Panel data evidence on stockholding suggests that changes in marital status and children matter empirically as well, but not always in the manner that the model predicts.

Keywords: G11, G22, D91, E21, I10, J12

Suggested Citation

Love, David A., The Effects of Marital Status and Children on Savings and Portfolio Choice. Review of Financial Studies, Vol. 23, No. 1, pp. 385-432, 2009, Available at SSRN: https://ssrn.com/abstract=1540995 or http://dx.doi.org/10.1093/rfs/hhp020

David A. Love (Contact Author)

Williams College - Department of Economics ( email )

South Academic Building, RM 202
Williamstown, MA 01267
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
507
PlumX Metrics