Stanford University

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Economists have been worked up about an “annuity puzzle.” An annuity is bought near-retirement (say at age 67) by giving an insurance company a chunk of money; in return the company guarantees a specified annual income till you die. So annuities should be irresistible to anyone afraid of outliving their money – presumably all “rational” people. The “puzzle” is that very few people buy annuities.

Forty years. That’s at least how long an academic career can last, if you start at 30 and retire at 70. There is no mandatory retirement age (at least in the UK and US) and, unlike most people, tenured academics cannot lose their jobs. For older academics (say over 50) increased longevity can be accompanied by the right to work as long as one wants.