Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22 Page 23 Page 24 Page 25 Page 26 Page 27 Page 28 Page 29 Page 30 Page 31 Page 32 Page 33 Page 34 Page 35 Page 36 Page 37 Page 38 Page 39 Page 40 Page 41 Page 42 Page 43 Page 44 Page 45 Page 46 Page 47 Page 48 Page 49 Page 50 Page 51 Page 52 Page 53 Page 54 Page 55 Page 56 Page 57 Page 58 Page 59 Page 60 Page 61 Page 62 Page 63 Page 64 Page 65 Page 66 Page 67 Page 68 Page 69 Page 70 Page 71 Page 72 Page 73 Page 74 Page 75 Page 76 Page 77 Page 78 Page 79 Page 80 Page 81 Page 82 Page 83 Page 84 Page 85 Page 86 Page 87 Page 88 Page 89 Page 90 Page 91 Page 92 Page 93 Page 94 Page 95 Page 96 Page 97 Page 98 Page 99 Page 100 Page 101 Page 102 Page 103 Page 104 Page 105 Page 106 Page 107 Page 10840 CHAPTER 2: work & retirement Attitudes, expectations, and behaviors related to work and retirement have changed considerably over the past half century. In 1950, the average man retiring at age 65 could expect to live another 13 years, and a 65-year-old woman another 15 years. Today, men average an additional 17 years and women another 20 years beyond what we think of as the typical retirement age. With such improvements in health and longevity, people might have been expected to work longer and retire later. Instead, the opposite trend unfolded. Between the 1950s and the mid-1980s, participation of older men in the labor force declined at a notable rate as more and more men opted for retirement before the standard age of 65. This decline leveled off after the mid-1980s and, since 1990, labor force participation rates for older men have increased slightly. The story for older women reflects two complementary trends. Proportionally more women of all ages are working in the for- mal labor market, and labor force participation rates for women over age 60 (especially those in the 60 to 64 age range) have also risen significantly during the past 20 years. The Health and Retirement Study delves deeply into the work and retirement of older Americans. This chapter discusses HRS findings about labor force participation and the nature of work among older adults, factors that contribute to people’s decisions to retire, the consumption of goods and services with age, and attitudes about retirement. It also looks at retirement incentives in pension programs and the knowledge that people have about their retirement plans. defined-benefit plans (usually including retirement incentives, lifelong benefits, and reduced pension investment risk) retire on average 1.3 years earlier than those with defined-contribution plans such as 401(k)s. Health problems can have a big influence on the decision to retire early. One analysis of HRS data suggests that poor health is a stronger influence than financial variables on people’s decisions to retire. Poor health is cited as being very important in the decision to retire for 35 percent of people ages 55 to 59, but considerably less so among those 60 and older. Married couples tend to make retirement deci- sions jointly, even when that means one will continue to work. One study using four waves of HRS data found that people are less likely 2000 say they found the retirement transition to be “very satisfying.” One-third of retirees reported moderate satisfaction, and only 7 percent reported that their retirement was not satisfying. Baby boomers are expecting to work longer, perhaps presaging a reversal in the century- long trend toward earlier retirement. Compared with 1992, in 2004, a substantially larger proportion of people in their early to mid-50s expected to work after 65. The structure and availability of pensions strongly influence the decision about when to retire. The expansion of defined-contribution plans and decline of defined-benefit plans over the past 20 years may be playing a role in ending the trend toward earlier retirement. A study using HRS data finds that people with CHAPTER Highlights HRS data show that people are ready to retire in their early to mid-60s, but retirement trends are changing, with older adults increasingly interest- ed in part-time opportunities and other activities to stay busy and productive with age: Although retirement rates rise steeply at the Social Security eligibility ages of 62 and 65, many older people do remain in the workforce, either full-time or part-time. In their 50s, most men (70 percent) and a majority of women (60 percent) work. By age 65, employment rates among men and women are half of what they were for workers a decade younger. Most people are happy and active in retire- ment. Some 61 percent of retirees surveyed in