Debt Close to Retirement and Its Implications for Retirement Well-being

30 Pages Posted: 6 Nov 2019 Last revised: 15 May 2020

See all articles by Annamaria Lusardi

Annamaria Lusardi

Stanford University - Stanford Institute for Economic Policy Research

Olivia S. Mitchell

University of Pennsylvania - The Wharton School, Pension Research Council; University of Pennsylvania - The Wharton School; National Bureau of Economic Research (NBER)

Noemi Oggero

University of Turin

Date Written: May 6, 2020

Abstract

We analyze debt and debt management of Americans nearing retirement age, to document that older people have numerous financial obligations that can lead to financial distress. Using data from the 2015 National Financial Capability Study and drawing on an extensive literature review, we show that lack of financial literacy, lack of information, and behavioral biases help explain the prevalence of debt later in life. Our evidence indicates that debt at older ages can negatively influence retirement well-being.

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Suggested Citation

Lusardi, Annamaria and Mitchell, Olivia S. and Oggero, Noemi, Debt Close to Retirement and Its Implications for Retirement Well-being (May 6, 2020). CFS Working Paper, No. 631, 2019, Wharton Pension Research Council Working Paper No. 2019-08, Available at SSRN: https://ssrn.com/abstract=3476324 or http://dx.doi.org/10.2139/ssrn.3476324

Annamaria Lusardi

Stanford University - Stanford Institute for Economic Policy Research ( email )

366 Galvez Street
John A. and Cynthia Fry Gunn Building
Stanford, CA CA 94305
United States

HOME PAGE: http://siepr.stanford.edu/people/annamaria-lusardi

Olivia S. Mitchell (Contact Author)

University of Pennsylvania - The Wharton School, Pension Research Council ( email )

3302 Steinberg Hall-Dietrich Hall
3620 Locust Walk
Philadelphia, PA 19104-6302
United States

University of Pennsylvania - The Wharton School ( email )

Philadelphia, PA 19104-6365
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Noemi Oggero

University of Turin ( email )

Corso Unione Sovietica 218 bis
Torino, Turin 10134
Italy

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