ACCI Conference 2024

CFP Board's ACCI Financial Planning Paper Award Winner

"Using two data sets (Prudential Financial Wellness Survey, and Health and Retirement Study), this study demonstrates that although there is generally a natural upward trend for older (age 50+) Americans to progressively delay their expected retirement, this trend has no statistically significant relationship with the COVID-19 pandemic. The distribution of older Americans’ expected retirement ages is bimodal, often centered around two Social Security Benefit claiming ages – the early retirement age and full retirement age. However, their actual retirement ages are more likely to follow a left-skewed (retire earlier) distribution. The most significant factors that influence participants’ retirement decisions relative to expectations are health (+)^[1], wealth (-), age (+), change of marital status (+), mortality expectations (+), education levels (+), disability (-), and major illness diagnosis (-). Focusing on these factors can help the retirement benefits community explore strategies to mitigate the negative consequences of gaps between retirement expectations and reality.

^[1] “(-)” means the impact is negative, i.e., retire earlier than expected, and “(+)” means the impact is positive."

Author(s): Zhikun Liu, David Blanchett, Qi Sun, Naomi Fink