Journal

Researchers have become increasingly interested in understanding the sources of heterogeneity in individual financial behaviors. In this paper, we examine how the Big Five personality traits are related to measures of young adults’ financial distress. Using data from the National Longitudinal Study of Adolescent to Adult Health in the United States, we find that conscientiousness is negatively correlated, and neuroticism positively correlated with financial distress. These correlations are robust to controlling for early life background and other demographic and socioeconomic factors.

Over the last several decades, there has been a well-documented trend away from defined benefit plans toward defined contribution plans, in which an employee's retirement income depends on contributions to the plan along with the investment earnings on those contributions. Current workers increasingly must decide how much to contribute to retirement plans and how to invest plan contributions.

Individual savings are critical for retirement as government and employer-based provisions fade or become less secure. Rural communities are vulnerable given their higher proportion of elderly and more who rely on Social Security. Using a telephone survey of working-age residents in Michigan's rural Upper Peninsula, this research investigates factors associated with participation in tax-advantaged retirement plans that have largely replaced defined-benefit pension plans for earmarked retirement savings.

This journal article examines how the surge in home values between 2000 and 2006 and the drop in prices since then are related to the demand for reverse mortgage loans in the United States. It also investigates the relationship between recent trends in reverse mortgages and borrower characteristisc such as age, gender and state/region of residence of the eligible homeowner(s). The results of the study provide insight into how consumer education, the Federal Goverment, the mortgage industry and financial planners can better educate the population about this type of financing.

Abstract: The main factors underlying the rise in mortgage defaults appear to be declines in house prices and deteriorated underwriting standards, in particular an increase in loan-to-value ratios and in the share of mortgages with little or no documentation of income.

Many older US households have done little or no planning for retirement, and there is a substantial population that seems to undersave for retirement. Of particular concern is the relative position of older women, who are more vulnerable to old-age poverty due to their longer longevity. This paper uses data from a special module devised on planning and financial literacy in the 2004 Health and Retirement Study. It shows that women display much lower levels of financial literacy than the older population as a whole.

We compare wealth holdings across two cohorts of the Health and Retirement Study: the early Baby Boomers in 2004, and individuals in the same age group in 1992. Levels and patterns of total net worth have changed relatively little over time, though Boomers rely more on housing equity than their predecessors. Most important, planners in both cohorts arrive close to retirement with much higher wealth levels and display higher financial literacy than non-planners.