Managing a Retirement Portfolio: Do Annuities Provide More Safety?

Spitzer, J.J. (2009). Managing a retirement portfolio: Do annuities provide more safety? Journal of Financial Counseling and Planning Education, 20(1), 58-69.

Brief Description:  One of the biggest concerns of retirees is the risk of outliving their assets. This study used a technique called “bootstrap simulations” to estimate the probability of someone outliving a retirement portfolio as increasing proportions of a tax-deferred account are annuitized. It also examined the sizes of the portfolio balance as the annuity amount increased. Required …

Spousal differences in financial risk tolerance

 

Gilliam, J.E., Goetz, J.W. & Hampton, V. L. (2008). Spousal differences in financial risk tolerance. Financial Counseling and Planning, 19(1), 3-11.

Brief Description: This study explored the financial risk tolerance of 110 couples who completed a Web-based survey. Wives who were university graduates had a higher tolerance for risk, whereas their husbands’ mean risk tolerance score was lower than husbands whose wives did not have degrees. Perhaps, due to a higher level of household income, it is unnecessary for …

What is a Veteran’s Administration (VA) Mortgage Loan?

Veteran’s Administration (VA) loans are available to members of the armed forces, veterans, and their spouses. Loans are made for up to 100 percent of the home’s value. The home must be the borrower’s primary residence. Loans may be assumable. The veterans must have served 180 days in peacetime or 90 days in wartime, including recent Gulf and Iraq wars.

For more information about VA loan eligibility, see http://www.valoans.com/va_article?id=319.

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Risk tolerance and investments of business owners

 

Wong, C. & Hanna, S.D. (2007). The risk tolerance and stock ownership of business owning households. Financial Counseling and Planning, 18(2), 3-18.

Brief Description: This study examined the risk tolerance and stock ownership of three types of households: non-business owners, those that own and manage a business, and those that own but do not manage a business. Non-manager business owners were more likely than others to take risks and hold stocks, and manager owners were significantly less likely to …

Couples’ money management behavior and relationship satisfaction

 

Britt, S., Grable, J.E., Nelson, B.S., & White, M. (2008). The influence of perceived spending behaviors on relationship satisfaction. Financial Counseling and Planning, 19(1), 31-43.

Brief Description: This study explored relationships between couples’ personal and joint spending habits and relationship satisfaction. Results indicated that partner spending behaviors, but not one’s own or joint spending behaviors, influence relationship satisfaction. Other factors associated with relationship satisfaction were high self-esteem (positive relationship) and financial stressors such as medical bills (negative relationship).

Implications:

High School Economic Education and Access to Financial Services

 

Grimes, P.W., Rogers, K.E., & Smith, R.C. (2010) High School Economic Education and Access to Financial Services, Journal of Consumer Affairs, 44(2), 317-335.

Brief Description: This study examines the relationship between students taking economics and business courses while in high school and their decision to open and maintain a commercial bank account as an adult. The results of a nationwide telephone survey revealed that high school courses in economics and business reduced the probability that an adult was unbanked, …

Wealth and the Acquisition of Financial Literacy

 

Monticone, C. (2010). How much does wealth matter in the acquisition of financial literacy? The Journal of Consumer Affairs, 44 (2), 403-422.

Brief Description: This article investigated the determinants of financial literacy in Italy using the 2006 wave of the Italian survey on household income and wealth. Empirical results indicated that wealth has a positive effect on financial literacy, suggesting that households endowed with larger financial assets are more likely to invest in financial knowledge.

Implications: an implication for policymakers …

Asset ownership by black and white families

 

DeVaney, S. A., Anong, S. T. & Yang, Y. (2007). Asset ownership by black and white families. Financial Counseling and Planning, 18(1), 33-45.

Brief Description: The study explored differences in ownership of homes, investment accounts, and retirement accounts by Black and White families. Greater education, income, and contact with financial institutions increased asset ownership for both groups. White families who saved regularly were more likely to own a home and to have investment and retirement accounts. Denial of credit …

Mortgage Professionals’ Perspectives on Abusive and Predatory Lending

 

Delgadillo, L. Erickson, L.V. & Piercy K.W. (2008). Disentangling the differences between abusive and predatory lending: Professionals’ perspectives. The Journal of Consumer Affairs 42 (3), 313-334.

Brief Description: This study describes how mortgage professionals differentiate abusive from predatory lending. The results indicate that some users of this term do not always adhere to a strict definition of predatory lending, but rather use it as a term for any general mortgage abuse and mortgage fraud. Existing laws at the federal and …

Consumer Empowerment and Welfare with Respect to Mortgage Servicers

 

Bone, P. F. (2008). Toward a general model of consumer empowerment and welfare in financial markets with an application to mortgage servicers. The Journal of Consumer Affairs, 42 (2), 165-188.

Brief Summary: Mortgage servicers, firms that collect and distribute homeowners’ mortgage interest, principal, and escrowed taxes and insurance, are prone to mistakes and may engage in predatory practices that negatively affect consumer welfare. Using this industry as a case study, this paper develops a general model of consumer empowerment and …