Minorities and Retirement Security (MRS) Program Chicago State University

1. Minorities and Retirement Security (MRS) ProgramChicago State University Monthly Seminar May 30, 2014 Project Director: Dr. A. Hervani Faculty Mentors: Dr. P. Aka; Dr. E. Arnott-Hill Fellow: R. Spaulding

2. Literature Review: Low income minority groups • Baby Boomers • Elderly • Early retirees • Singles/Head of households • Gender - Female • Mid-50s • Ethnic groups – African-Americans, Hispanics • Entrepreneurs

3. Retirement Security Issues Socio-economic changes: • Availability of employer retirement benefits (changes from defined-benefit plans to defined-contribution plans to individual plans) • Forced early retirement • Poverty • Health • Social Security • Savings • Investments

4. Retirement Security Issues • Financial knowledge (pension incentives, income tax credits) • Financial practices (saving, budgeting, personal decision-making) • Wealth vs Income • Wealth gap • Gender gap • Elder care; long-term care • Health; disabilities, chronic illness

5. Sources/Methodology/Mathematical Model • U.S. Social Security Administration/Modeling Income in the Near Term (MINT)/ Micro-simulation • Eurostat & U.S. Census Bureau/European Union Statistics on Income and Living Conditions (EU-SILC), U.S. Panel Study of Income Dynamics (US-PSID)/Comparative analysis • U.S. Census of Population and Housing/ 5% Public Use Microdata Sample (PUMS)/ Multivariate Models

6. Source/Methodology/Mathematical Model • National Institute on Aging & Social Security Administration/University of Michigan Health and Retirement Study (HRS), Waves 1-4/multivariate models; simulations, structural retirement model, descriptive statistics, comparatives • Survey of Consumer Finances (SCF)/Urban Institute’s DYNASIM3/micro-simulation model • Statistics Canada’s Research Data Centre/2009 Canadian Financial Capability Survey (CFCS)/Multivariate, regression analyses • Bureau of Labor Statistics/National Longitudinal Survey of Mature Women (NLSMW)/Hierarchical linear model

7. Implications/Recommendations • Government benefits (support, subsidies) • Fringe benefits (other compensation, i.e. education reimbursement) • Data collection (disaggregation by race, gender, ethnicity) • Opportunities (job training) • Incentives to save • Health insurance (adequate protection) • Financial education (schools, employers)

8. References Bayer, P. J., Bernheim, B. D., & Scholz, J. K. (2009). The effects of financial education in the Workplace: Evidence from a survey of employers. Economic Inquiry, Western Economic Association International, 47(4), 605-624. Berry, B. (2006). What accounts for race and ethnic differences in parental financial transfers to adult children in the United States? Journal of Family Issues, 27(11), 1583-1604. Brimmer, A. F. (1988). Income, wealth, and investment behavior in the black community. The American Economic Review, 1988, 78(2), 151-155. Butrica, B. A., Murphy, D. P., & Zedlewski, S. R. (2009). How many struggle to get by in retirement? The Gerontologist, 50(4), 482-494. Chan, S. & Stevens, A. H. (2008). What you don’t know can’t help you: Pension knowledge and retirement decision-making. The Review of Economics and Statistics, 90(2), 253-266. Finkelstein, E. S. Reid, M. C., Kleppinger, A., Pillemer, K. & Robison, J. (2012). Are baby boomers who care for their older parents planning for their own future long-term care needs? Journal of Aging & Social Policy, 24(1), 29-45.

9. Haas III, W. H., Bradley, D. E., Longino Jr., C. F., Stoller, E. P., & Serow, W. J. (2006). In retirement migration, who counts? A methodological question with economic policy implications. The Gerontologist, 46(6), 815-820. Holtz-Eakin, D., Joulfaian, D., & Rosen, H. S. (1994). Entrepreneurial decisions and liquidity constraints. Rand Journal of Economics, 25, 334-347. Hui, T. S., Vincent, C. & Woolley, F. (2011). Understanding gender differences in retirement saving decisions. Social Research and Demonstration Corporation. Ottawa, Ontario Iams, H. M., Reznik, G. L., & Tamborini, C. R. (2010). Earnings sharing in the U.S. Security system: A microsimulationanalysis of future female retirees. The Gerontologist, 50(4), 495-508. Mermin, G. B. T., Zedlewski, S. R. & Toohey, D. J. (2008). Diversity in retirement wealth accumulation. Urban Institute. The Retirement Policy Program, Brief Series 24, 1-12. Peeters, H., Debels, A., & Verpoorten, R. (2013). Excluding institutionalized elderly from surveys: Consequences for income and poverty statistics. Social Indicators Research, 110, 751-769.

10. Smith, J. P. (1995). Racial and ethnic differences in wealth in the health and retirement study. The Journal of Human Resources, 30, 158-183. Snyder, A. R., McLaughlin, D. K., & Findeis, J. (2006). Household composition and poverty among female-headed households with children: Differences by race and residence. Rural Sociology, 71(4), 597-624. Wakabayashi, C. and Donato, K. M. (2006). Does caregiving increase poverty among women in later life? Evidence from the Health and Retirement Survey. Journal of Health and Social Behavior, 47(3), 258-274. Whitaker, E. A., Bokemeier, J. L., & Loveridge, S. (2011). Retirement plan participation in an era of change: The case of a rural region. Rural Sociology, 76(3), 319-346. Willson, A. E. (2003). Race and women’s income trajectories: Employment, marriage, and income security over the life course. Social Problems, 50(1), 87-110. Wright, R. (2011). Paying for retirement: Sex differences in inclusion in employer-provided retirement plans. The Gerontologist, 52(2), 231-244.