How people react to pension risk

Nicolas Salamanca Acosta, Andries de Grip, Olaf Sleijpen

Research output: Working paper / PreprintDiscussion paper


We show that people exposed to greater pension risk are less likely to invest in risky assets. We exploit a reform that links people's future pension benefits to their pension funds' funding ratio—a measure of the fund's financial health—making funding ratios a fund-specific measure of pension risk. The effect of pension risk is stronger for people who are better informed about their pensions, for retirees and pension-age non-retirees, and for wealthier people. The funding ratio does not affect investments in a pre-reform period, nor does it affect bequest intentions, (expected) retirement, or the motivations for saving.
Original languageEnglish
Place of PublicationBonn
Number of pages40
Publication statusPublished - 2020

Publication series

SeriesIZA Discussion Paper Series

JEL classifications

  • d14 - Personal Finance
  • j22 - Time Allocation and Labor Supply


  • individual portfolio choice
  • background risk
  • retirement planning
  • pension reform
  • The Netherlands


Dive into the research topics of 'How people react to pension risk'. Together they form a unique fingerprint.

Cite this