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Annuity or Lump Sum: Getting Retiring Smokers to Make Better Savings Distribution Decisions

  • Abigail Hurwitz
  • , Yaniv Hanoch
  • , Andrew Barnes
  • , Orly Sade
    • Hebrew University of Jerusalem
    • Virginia Commonwealth University

    Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

    Abstract

    Despite the link between smoking and reduced lifespan, the effect of smoking on retirement savings withdrawal remains understudied. We investigate the impact of various leaflets on smokers’ retirement choices: (a) smoker vs. non-smoker life expectancies, (b) smoking’s health effects, (c) health impact with government’s advice to consider health upon retirement, or (d) combined smoker’s life expectancy and health info. Analyzing data from 2,000 smokers, we find that those informed about smoking’s lifespan impact, alone or with health consequences, were likelier to opt for lump sum over annuity. This suggests that informing smokers about smoking’s harms can influence their retirement choices.
    Original languageEnglish
    Title of host publicationBehavioral Finance
    Subtitle of host publicationBeyond the basics
    Editors Itzhak Venezia, Rachel Calipha
    PublisherWorld Scientific Publishing
    Chapter7
    Pages161-183
    Number of pages23
    ISBN (Electronic)978-981-12-9064-0
    ISBN (Print)978-981-12-9062-6
    DOIs
    Publication statusE-pub ahead of print - 16 Oct 2024

    Publication series

    NameWorld Scientific Lecture Notes in Finance
    PublisherWorld Scientific
    ISSN (Print)2424-9939

    UN SDGs

    This output contributes to the following UN Sustainable Development Goals (SDGs)

    1. SDG 3 - Good Health and Well-being
      SDG 3 Good Health and Well-being

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