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Virginia Tech

The Impact of Bankruptcy Exemptions for Retirement Assets

Abstract

dc:description.abstract

When filing for personal bankruptcy, an individual can, in almost all cases, claim an exemption for retirement assets. Using the Survey of Consumer Finances from 2007 and 2010, we test the theory that highly educated or financially sophisticated households allocate more resources to retirement assets under conditions of higher probability of filing for personal bankruptcy. This hypothesis stems from the concept of asset sheltering, in which an individual will demonstrate a preference for assets that are exempt from a particular risk. To address our hypothesis, we run a Heckman model on the Survey of Consumer Finances data. Our results provide evidence to match our theory for only highly educated or financially sophisticated individuals, conditional on owning retirement assets. That is, we observe highly educated and financially sophisticated households allocate more resources to retirement accounts when they are at higher risk for bankruptcy. Other characteristic groups do not demonstrate a similarly strong relationship between the probability of filing for bankruptcy and the level of retirement assets.

Degree

thesis:*
Name thesis:degree_name
Master of Science
Level thesis:degree_level
masters
Discipline thesis:degree_discipline
Agricultural and Applied Economics
Department dc:contributor.department
Agricultural and Applied Economics
Grantor dc:publisher
Virginia Tech
Year dc:date.issued
2013

Author and committee

dc:creator, dc:contributor.*
Author dc:creator
  • Baker, Matthew
Chair dc:contributor.committeechair
  • Smith, Hyrum Legrand
Committee members dc:contributor.committeemember
  • Davis, George C.
  • Geyer, L. Leon

Subjects

dc:subject × 5

Rights

dc:rights
Statement dc:rights
  • In Copyright

Identifiers

dc:identifier.*
Dc Identifier Other
vt_gsexam:893
OAI identifier oai:identifier
oai:vtechworks.lib.vt.edu:10919/22080

Chain of custody

source
Harvested from
Virginia Tech
Base URL
vtechworks.lib.vt.edu/oai/request
Last updated
2026-07-22
Source record
OAI-PMH GetRecord
citation

Baker, Matthew. The Impact of Bankruptcy Exemptions for Retirement Assets. masters thesis, Virginia Tech, 2013. http://hdl.handle.net/10919/22080