Tag: consumption
Abstract Much of the disagreement over whether households are adequately prepared for retirement reflects differences in assumptions regarding the extent to which consumption declines when the kids leave home. If consumption declines substantially when the kids leave home, as some life-cycle models of retirement saving assume, households need to achieve lower replacement rates in retirement…
The brief‘s key findings are: Federal Reserve data show that retirement preparedness has been declining over time, but studies on the level of preparedness offer conflicting assessments. The National Retirement Risk Index (NRRI) finds half of households are “at risk,” while studies of optimal savings suggest less than one-tenth will fall short. The optimal savings…
