Asset allocation decisions in retirement accounts

an all-or-nothing proposition?

Authors

  • Doug Waggle Campbell School of Business, Berry College, Mount Berry, GA 30149-5024, USA
  • Basil Englis Campbell School of Business, Berry College, Mount Berry, GA 30149-5024, USA

DOI:

https://doi.org/10.1016/S1057-0810(00)00057-3

Keywords:

Asset allocation, Retirement accounts, Individual investors

Abstract

An examination of survey responses about Individual Retirement Account (IRA) holdings reveals that individuals often take all-or-nothing approaches in their decisions to diversify across the asset categories of cash, bonds, and equity. Two thirds of survey respondents put their entire IRA holdings into a single asset category. A surprisingly large proportion of funds is held in cash, while only a minimal amount is invested in bonds. These findings also contrast with those of Bodie and Crane’s (1997) examination of TIAA-CREF participants, which is heavily weighted with individuals holding fixed income annuities. Our results suggest that there is a compelling need for risk education for investors. © 2000 Elsevier Science Inc. All rights reserved.

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Published

2000-03-30

How to Cite

Waggle, D., & Englis, B. (2000). Asset allocation decisions in retirement accounts: an all-or-nothing proposition?. Financial Services Review, 9(1), 79–92. https://doi.org/10.1016/S1057-0810(00)00057-3

Issue

Vol. 9 No. 1 (2000): Financial Services Review

Section

New Original Submission

License

Copyright (c) 2000 JAI Press Inc.

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