求助annuity puzzle  贴老师给的参考 求给思路According to Brown, while researchers and policymakers have placed enormous attention on the accumulation phase of retirement accounts,such as how individuals save and invest, they are becoming increasingly aware that asset accumulation is only part of the retirement security equation. The other part is how individuals convert their accumulated savings into a retirement consumption stream, particularly when most of us do not know how long we will live. Indeed, uncertainty about length-of-life is one of the most significant sources of financial risk facing today’s retirees.

Dramatic advances in life expectancy over the last century mean that today’s typical 65-year old man and woman can expect to live to age 81 and 85 respectively. Perhaps even more striking is the fact that almost a fifth of 65-year-old men and nearly one-third of 65-year-old women will live to age 90 or beyond. Without appropriate financial planning during retirement, increased longevity means that individuals face a greater risk of being forced to substantially reduce their living standards at advanced ages. Life annuities are financial instruments that allow an individual to exchange a stock of wealth for a stream of income that continues for life.

So why is the Annuity Market So Small? Given the remarkable disconnect between theory and practice, it is natural to ask why more individual do not purchase life annuities.


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