Table 4.
Simulated and empirical annuity ownership rates among 65–69-year-old single retirees in the Health and Retirement Study. The simulation uses annuities with a ten percent load, typical of the U.S. private market.
| Annuity ownership rate | ||||
|---|---|---|---|---|
| Bequest motive | ||||
| None | 69.1% | 67.6% | 61.0% | 54.9% |
| De Nardi et al. (2010) | 60.6% | 62.3% | 56.4% | 44.8% |
| Hurd and Smith (2002) | 24.7% | 15.6% | 11.7% | 4.9% |
| Kopczuk and Lupton (2007) | 21.7% | 13.6% | 10.6% | 4.4% |
| De Nardi (2004) | 19.0% | 18.5% | 15.4% | 4.5% |
| Lockwood (2010) | 16.8% | 16.8% | 12.6% | 3.8% |
| Ameriks et al. (2009) | 0.3% | 0.0% | 0.0% | 0.0% |
| Average ownership, middle four bequest motives* | ||||
| 20.5% | 16.1% | 12.6% | 4.4% | |
| Empirical ownership rate | 3.6% | |||
| Model | ||||
| Medical spending | No | Yes | Yes | Yes |
| Minimum annuity size | $0 | $0 | $20,000 | $20,000 |
| Fixed cost | $0 | $0 | $0 | $2,000 |
*
Simple average of the ownership rates using the Hurd and Smith (2002), Kopczuk and Lupton (2007), De Nardi (2004), and Lockwood (2010) bequest motives.