How Family Status Influences Work and Retirement, Saving and Dissaving, Insurance Demand and Portfolio Choice over the Life Cycle

Published: 2013
Project ID: UM13-12


This project will analyze how changing family status over the life cycle influences consumption, portfolio choice, life insurance demand, and labor supply. Prior models have not focused in much detail on the way in which changes in marital status and numbers of children might influence household behavior. Nevertheless, in the presence of differential labor income profiles for men and women, there is expected to be an increased demand for term life insurance or joint and survivor annuities, since labor supply cannot be adjusted easily in case of a spousal death. And, children affect parental decisions by requiring consumption as well as time inputs. We will analyze the effect of changing family status over the life cycle on retirement accumulations and behavior, taking into account current US Social Security rules.