Debt Close to Retirement and its Implications for Retirement Well-being

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Wharton Pension Research Council Working Papers
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Older adults
debt
National Financial Capability Study
financial understanding
Economics
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Lusardi, Annamaria
Oggero, Noemi
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Abstract

We analyze debt and debt management of Americans nearing retirement age, to document that older people have numerous financial obligations that can lead to financial distress. Using data from the 2015 National Financial Capability Study and drawing on an extensive literature review, we show that lack of financial literacy, lack of information, and behavioral biases help explain the prevalence of debt later in life. Our evidence indicates that debt at older ages can negatively influence retirement well-being.

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2020-05-06
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The published version of this working paper may be found in the 2020 publication: Remaking Retirement: Debt in an Aging Economy (https://pensionresearchcouncil.wharton.upenn.edu/remaking-retirement-debt-in-an-aging-economy/)
This project received funding from the TIAA Institute and the Wharton School’s Pension Research Council/Boettner Center.
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