The Comprehensive Wealth of Immigrants and Natives

Published: 2015
Project ID: UM15-16


Immigrants have lower levels of annuitized wealth through Social Security and pensions than the native born, and they tend to hold a greater concentration of wealth in the form of housing. These facts suggest that there may be important differences in the saving and drawdown behavior of immigrants and natives. We will investigate immigrant-native differentials in annualized comprehensive wealth per person, a measure of household resources that includes total financial and non-financial assets, plus annuitized assets such as Social Security and defined-benefit pensions. We will then examine how the levels, composition, and trajectory of comprehensive wealth differ by immigration status. Finally, we will attempt to explain observed differences in wealth patterns with the help of a life-cycle model that includes roles for uncertain longevity, bequest motives, housing, and risks in asset returns, income, and medical costs.