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  5. The Changing Face of Debt and Financial Fragility at Older Ages

The Changing Face of Debt and Financial Fragility at Older Ages

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Abstract

We investigate changes in older individuals' financial fragility as they stand on the verge of retirement. Using data from the Health and Retirement Study (HRS), we compare how debt has changed for successive cohorts of people age 56–61. Our analysis shows that recent older Americans close to retirement hold more debt, and hence face greater financial insecurity, than earlier generations. This is primarily due to having bought more expensive homes with smaller down payments. We discuss possible policy implications.

Citation

Lusardi, Annamaria, Olivia S. Mitchell, and Noemi Oggero. 2018. "The Changing Face of Debt and Financial Fragility at Older Ages." AEA Papers and Proceedings, 108: 407-11. DOI: 10.1257/pandp.20181117

Additional Materials

JEL Classification

  • D14 Household Saving; Personal Finance
  • J14 Economics of the Elderly; Economics of the Handicapped; Non-labor Market Discrimination
  • J26 Retirement; Retirement Policies