Pension Expectations and Household Portfolio Choice of the Elderly in Japan

Tsunao Okumura and Emiko Usui

No 694, CIS Discussion paper series from Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University

Abstract: Using the Japanese Study of Aging and Retirement (JSTAR), we examine the determinants of household portfolio choice by the elderly in Japan. Only one-fifth of Japanese elderly hold stocks among their financial assets. Japanese elderly who are more educated, have better mental functions, have higher income, and subjectively expect a greater probability of living until at least age 80 are more likely to hold stocks. Among those who plan to receive public pension benefits in the future, those who expect a greater decline in future public pension benefits have a smaller share of stocks and a larger share of bonds in their portfolio of financial assets, but both are in small quantities. The most important factors affecting the relatively low investment in stocks by Japanese elderly are educational and income differences, rather than their low expectations about their future pension benefits.

Keywords: Household portfolio choice; subjective expectations; pension benefits; Japan (search for similar items in EconPapers)
JEL-codes: D84 H55 I10 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2021-09
New Economics Papers: this item is included in nep-age, nep-cwa and nep-isf
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Persistent link: https://EconPapers.repec.org/RePEc:hit:cisdps:694

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