TITLE:
Impact of Inheritance and Housing Wealth on Retirement Decision
AUTHORS:
Sid Ali Amedah, Maxime Fougère
KEYWORDS:
Inheritance, Housing Wealth, Retirement Hazard, Financial Security
JOURNAL NAME:
Open Journal of Social Sciences,
Vol.5 No.7,
July
3,
2017
ABSTRACT: This paper proposes to find how wealth shocks such as inheritances and housing wealth impact retirement behaviour using cross-sectional micro data from the Canadian Survey of Financial Security. Estimation of wealth impact on retirement decision is challenging since wealth and retirement decision may be endogenously determined. We found no evidence that housing wealth impacts retirement decision suggesting that individuals are correctly anticipating future housing wealth and adjusting their labour market behaviour accordingly. However, the data supports the hypothesis that receiving an inheritance significantly increases the retirement hazard, which may indicate the existence of some financial constraints.