The Long and the Short of It: Financial Fragility in America

Much media and policy attention is devoted to enhancing Americans’ long-term financial security. For example, financial planners work hard to help people boost their savings for the long term. Many firms automatically enroll workers in pension plans, sometimes with company matches, to help their employees build up retirement assets. Also, government policy promotes saving for old age, including the important tax deferral provided to qualified retirement plans.Read More

TIAA Institute and Pension Research Council Showcase New Research on Financial Decision-making

The TIAA Institute and the Pension Research Council (PRC) of the University of Pennsylvania’s Wharton School released new research this month on the psychology, reasoning, biases and behavioral factors that affect how people make important financial and retirement decisions. The new studies – showcased during the TIAA Institute Fellows SymposiumRead More

You Don’t Have To Go To College To Save Right

In our new research study which interviewed participants across 10 European countries, our team working with Annamaria Lusardi has demonstrated that financial and risk literacy leads to better choices when it comes to making decisions and identifying the right paths to our financial goals. We also show that the impact of financial and risk literacy on decision-making goes above and beyond that of education. And as in Olivia S. Mitchell’s recent findings, we confirm that women and millennials are least informed when it comes to financial and risk literacy.Read More

Multiemployer Pension Plans In Crisis: Troubled Plans Need Public Resources To Survive

There is an emerging financial crisis among multiemployer pension plans in America. These plans are a subset of private sector defined benefit pensions covering 10 million workers and retirees. Most critical are the projected bankruptcies of the Teamsters Central States and the United Mineworkers of America plans, making front page news for the last several months. These plans and many others were undermined by two financial market crashes between 2000 and 2009, corporate bankruptcies, de-regulation, and over-regulation. It will now take more than hope to fix them.Read More

Understanding The Implications Of An Interest Rate Hike

Pundits keep a close watch on the U.S. Federal Reserve as it meets to raise interest rates after seven years of effectively zero rates. Yet the reality is that many Americans know little about interest rates, and much less about the implications of a rate hike for their finances! This was one key finding from the recently released S&P Global FinLit Survey, gathered with the support of McGraw Hill Financial.Read More

Putting The Pension Back Into Retirement

Defined contribution plans – often known as 401k plans – have become the mainstay of US company pensions, yet their main function has been to get employees to save and invest during their work years. These plans haven’t been successful at delivering lifetime income benefits, as a rule: fewer than one-fifth of all such plans today help workers convert their plan assets into retirement paychecks.Read More