By Steve Syre
LTSS Center researchers have identified the relationship between certain social and health characteristics and whether someone retired voluntarily or involuntarily.
Everyone hopes they will be able to choose the time of their retirement from work. It doesn’t always turn out that way.
A new study by the LeadingAge LTSS Center @UMass Boston found significant differences among fully retired people age 55 and older across the U.S., based on whether they left their jobs voluntarily or not. The analysis, conducted for the National Council on Aging, showed wide differences in social, health, and economic characteristics among voluntary and involuntary retirees.
The cross-sectional analysis was able to identify the relationship between certain social and health characteristics and whether someone retired voluntarily or involuntarily. But researchers said additional longitudinal analysis is needed to determine cause-and-effect relationships. For example, they wonder if health problems such as depression are more often a cause of involuntary retirement or a result of that employment outcome.
“Many of the differences between those voluntarily and involuntarily in retirement are huge,” said Jane Tavares, an LTSS Center fellow who worked on the study. “They highlight the importance of further analyses that could tease out that cause-and-effect relationship.”
VOLUNTARY RETIREES MORE LIKELY TO BE WHITE, BETTER EDUCATED
A review of retirees by education shows high school graduates and those with some college make up similar percentages of the voluntary and involuntary retiree groups. But those without high school degrees accounted for nearly a quarter of all involuntary retirees, twice their representation among voluntary retirees.
There were also significant racial differences related to the retirement decision. White retirees accounted for 75% of the voluntary category but only 69% of the involuntary group. Black retirees made up 19% of voluntary retirees but 23% of those who retired involuntarily.
Retirement patterns also varied by region across the country. Those in the Northeast made up roughly the same percentage of voluntary and involuntary retirees. But retirees from the South and western U.S. accounted for larger shares of the involuntary group than they did among voluntary retirees. Those from the Midwest made up 28% of voluntary retirees but only 18% of those who retired involuntarily.
INVOLUNTARY RETIREES MANAGE MORE HEALTH ISSUES
The differences in health characteristics among retirees were especially pronounced.
About 48% of involuntary retirees self-reported fair or poor health conditions, a status only 15% of voluntary retirees reported. About 31% in the involuntary category reported one or more limitations in activities of daily living, compared with 8% of voluntary retirees.
A large gap also existed between retirees who reported feelings of depression. More than 1 of every 3 involuntary retirees reported having depressed feelings in a given week, compared with just 12% of voluntary retirees.
Involuntary retirees also utilized more health care overall. They reported more hospital stays and relied more on home health care than those who had retired voluntarily. However, each group reported similar rates of visits to doctors.
A LARGE FINANCIAL ADVANTAGE FOR VOLUNTARY RETIREES
Those who retired voluntarily were in better financial condition by every measure. Voluntary retirees had a mean net wealth, excluding housing, of nearly $180,000, more than 3 times the amount for involuntary retirees. On average, voluntary retirees also had nearly twice as many liquid assets in checking, savings, and money market accounts.
About 23% of involuntary retirees reported participation in a government assistance program, compared with 11% of voluntary retirees. About 18% of those who retired involuntarily reported participation in the Supplemental Nutrition Assistance Program.
THE NEXT STEP
Tavares said the retirement analysis made an important contribution by highlighting the scale of differences in the circumstances of older adults who have left the workforce voluntarily or not. Now, she said, it’s important to dig deeper to better understand those differences.
“Untangling the cause and effect in all this information may help us better understand what we can do to make a difference,” said Tavares. “Particularly when it comes to health issues, we may be able to identify treatment or other action worthy of much greater investment.”