Factors Related to Meeting the Capital Accumulation Ratio Guideline

Authors

  • Rui Yao Ohio State University
  • Sherman D. Hanna Ohio State University
  • Catherine P. Montalto Ohio State University

DOI:

https://doi.org/10.61190/fsr.v11i2.4729

Keywords:

Retirement adequacy, Financial ratios, Capital accumulation ratio

Abstract

The capital accumulation ratio, investment assets divided by net worth, has been proposed as a useful indicator of financial health. Various experts recommend a minimum value of 25% to 509c for the ratio. When certificates of deposit are not counted as investment assets, 56% of U.S. households meet the 259c guideline and only 40% meet the 50% guideline. In a multivariate logistic regression, education, income, number of years until retirement, overspending, and financial risk tolerance are positively related to meeting the guidelines.

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Published

2002-06-30

How to Cite

Yao, R., Hanna, S. D., & Montalto, C. P. (2002). Factors Related to Meeting the Capital Accumulation Ratio Guideline. Financial Services Review, 11(2), 153–171. https://doi.org/10.61190/fsr.v11i2.4729

Issue

Vol. 11 No. 2 (2002): FSR Summer 2002

Section

New Original Submission

License

Copyright (c) 2002 Academy of Financial Services

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