TY  - JOUR
AU  - Poterba,James M.
AU  - Venti,Steven F.
AU  - Wise,David A.
TI  - Implications of Rising Personal Retirement Saving
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6295
PY  - 1999
Y2  - March 1999
UR  - http://www.nber.org/papers/w6295
L1  - http://www.nber.org/papers/w6295.pdf
N1  - Author contact info:
James M. Poterba
Department of Economics
MIT, E52-350
50 Memorial Drive
Cambridge, MA  02142-1347
Tel: 617/253-6673
Fax: 617/258-7804
E-Mail: poterba@nber.org

Steven F. Venti
Department of Economics
6106 Rockefeller Center
Dartmouth College
Hanover, NH  03755
Tel: 603/646-2526
Fax: 603/646-2122
E-Mail: steven.f.venti@dartmouth.edu

David A. Wise
Harvard Kennedy School
79 John F. Kennedy
Cambridge, MA   02138
E-Mail: dwise@nber.org
M1  - published as James M. Poterba, Steven F. Venti. "Implications of Rising Personal Retirement Saving," in David A. Wise, editor, "Frontiers in the Economics of Aging" University of Chicago Press (1998)

M2  - featured in NBER digest on 1998-07-01
AB  - Retirement saving accounts, particularly employer-provided 401(k) plans rapidly in the last decade.  More than forty percent of workers are currently eligible for these" plans, and over seventy percent of eligibles participate in these plans.  The substantial and" ongoing accumulation of assets in these plans has the potential to significantly alter the financial" preparations for retirement by future retirees.  This paper uses data on current age-specific" patterns of 401(k) participation, in conjunction with Social Security earnings records that provide" detailed information on age-earnings profiles over the lifetime, to project the 401(k) balances of" future retirees.  The results, which are illustrated by reference to individuals who were 27 and 37" in 1996, demonstrate the growing importance of 401(k) saving.  The projected mean 401(k)" balance at retirement for a current 37 year old is $91,600, assuming that the 401(k) plan assets" are invested half in stocks and half in bonds.  For a current 27 year old $125,000.  These results support the growing importance of personal saving through retirement" saving accounts in contributing to financial well-being in old age.
ER  -