This paper examines the impact of limited asset market participation on the elasticity of intertemporal substitution (EIS) using data from the US Consumer Expenditure Survey. The author finds that accounting for asset holders and non-asset holders is crucial for obtaining accurate estimates of the EIS. The EIS, which measures how much consumption changes in response to changes in expected consumption growth rates, is estimated to be around 0.3-0.4 for stockholders and 0.8-1 for bondholders, with larger values for households with higher asset holdings. Non-assetholders have significantly smaller and insignificant EIS estimates. The findings suggest that the EIS is higher for asset holders due to their greater sensitivity to asset returns, rather than a higher level of risk aversion. The paper also discusses the robustness of these results to different instrument sets and estimation methods, confirming the importance of distinguishing between asset holders and non-asset holders in estimating the EIS.This paper examines the impact of limited asset market participation on the elasticity of intertemporal substitution (EIS) using data from the US Consumer Expenditure Survey. The author finds that accounting for asset holders and non-asset holders is crucial for obtaining accurate estimates of the EIS. The EIS, which measures how much consumption changes in response to changes in expected consumption growth rates, is estimated to be around 0.3-0.4 for stockholders and 0.8-1 for bondholders, with larger values for households with higher asset holdings. Non-assetholders have significantly smaller and insignificant EIS estimates. The findings suggest that the EIS is higher for asset holders due to their greater sensitivity to asset returns, rather than a higher level of risk aversion. The paper also discusses the robustness of these results to different instrument sets and estimation methods, confirming the importance of distinguishing between asset holders and non-asset holders in estimating the EIS.