1. State Pension Benefit Estimates David G. Lenze Southern Regional Science Association 1 April 2006

2. www.bea.gov 2 SNA Treatment  Primary income of Household Sector  Employer contributions counted as part of compensation  Property income of pension funds is counted as part of dividends, interest, & rent

3. www.bea.gov 3 SNA Treatment  Disposable Household Income  Contributions (employer & personal) & Property income deducted  Benefits added  Hence:  Compensation includes contributions, but  Disposable income includes benefits

4. www.bea.gov 4 U.S. Pension Benefits (billion $) ABNIPA 1997470.9466.4390.8 1998522.7527.1397.5 1999566.1595.1424.5 2000612.6652.2453.4 2001644.1709.4484.6 A—Using Form 5500; B—Using Form 1099R

5. www.bea.gov 5 State Pension Estimates Source Data  SOI Division expanded IRMF sample  1099-R  5498  ACLI

6. www.bea.gov 6 Share of Nation—6 largest states, 2000 Pop. Inc.Pens. California12.0%13.1%10.7% Texas 7.4 7.0 4.9 New York 6.7 7.9 7.9 Florida 5.7 5.4 7.8 Illinois 4.4 4.8 4.1 Pennsylvania 4.4 4.3 4.3

7. www.bea.gov 7 Per Capita, 2000 ($) PersonalPension IncomeBenefits DC40,4565,385 Delaware30,8694,006 Hawaii28,4223,604 Maryland34,2573,395 Virginia31,0873,320 Florida28,5093,156 Maine25,9691,446

8. www.bea.gov 8 Adjustments to US Personal Income, 2000 (billion $) Personal income 8,429.7 - Net reclassifications 3.0 - Pension contributions 697.7 - Pension Fund Property Income 367.7 + Pension benefits 652.2 Cash personal income 8,013.6

9. www.bea.gov 9 Do Pension Benefits Contain Information Missed by Personal Income? Sales =.85 Personal Income + 12.1 (5.75) (7.98) R 2 =0.40 Sales =.70 Personal +.27 Pension +11.5 (4.81) (2.93) (8.05) R 2 =0.49