Differences in Subjective and Objective Survival Expectations of the Next Ten Years: What Causes the Gap?

Pawel Strzelecki , SGH Warsaw School of Economics

In this paper, we compare information from life tables with individual’ self-assessments of their survival probabilities. We use data from the SHARE survey covering 23 European countries, together with period, cohort, and prospective life tables. The paper aims to measure and explain the gap between subjective survival probabilities and objective probabilities derived from life tables. To identify the sources of this gap, we incorporate country- and gender-specific contextual variables. Our findings show that the discrepancy between subjective and objective survival probabilities changes over the life course and follows a similar pattern across most countries. Individuals over the age of 70 generally overestimate their chances of survival compared with life table values. In contrast, women aged 50–69 tend to underestimate their survival chances, while men in this age group provide assessments more closely aligned with the objective probabilities. These findings help explain why many people are reluctant to postpone retirement, even when actuarial calculations show that doing so would be financially beneficial. The results can also shed more light on the information people use when planning bequests.

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 Presented in Session P6. Health, Mortality, and Ageing 2