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 108I NCOME & WEALT H 68 Negative economic consequences for people who divorce or separate are even stronger than for those who become widowed, according to an- other analysis using early HRS results (Wilmoth and Koso 2002). Women’s economic status was more influenced by a marital dissolution than was men’s, although the differences tended to evaporate among people who remarried. Remar- riage appeared to offset the negative impact of a marital dissolution, while cohabiting did not offset the negative impact. Cohabiting people had wealth reductions that were similar to those of their single counterparts. Pension Wealth With the present shift away from defined-benefit programs toward defined-contribution programs, pension-policy experts are concerned that individu- als with greater “control” over their pension assets may choose to spend their assets quickly. In other words, retirees might exhaust lump-sum distribu- tions and/or defined-contribution payouts shortly after retirement, thereby leaving them at financial risk in later years. Two investigations of early HRS results found that this was not a widespread phe- nomenon. Engelhardt (2001) found little evidence that dipping into pension funds decreased retire- ment wealth. People who drew on future pensions did so in very modest amounts, while preserving most of their accumulations for retirement. Simi- larly, Gustman and Steinmeier (2000a) calculated that less than 10 percent of pension wealth was lost because people cashed out their benefits after leaving a pension-covered job. Both Engelhardt (2001) and Gustman and Stein- meier (2000a) used early HRS data for people ages 51 to 61 in 1992, but cautioned that their findings might change fairly quickly over time. If younger workers’ attitudes toward saving and retirement expectations differ from those of today’s older workers, the early HRS findings could underestimate the eventual retirement income security of future retirees. Greater access to funds could induce workers to use them for purposes other than those for which pensions are intended. Moreover, the changing nature of pen- sion systems will almost certainly affect retire- ment planning and behavior. Aging and Housing Equity Figures 3-6 and 3-7 show that homes are the most important single asset for a large proportion of older Americans. However, researchers interested in the economics of aging want to FIG. 3-9 poverty rate for widows, by duration of widowhood: 1998 (Percent in poverty) Years of Widowhood 21+ 7–11 12–20 2–6 0% 5% 10% 15% 20% 25% Source: Weir et al. 2002. FIG. 3-8 changes in women’s household net worth, by marital status: 1992–1998 (Women ages 51-61 in 1992) $0 $50,000 $100,000 $150,000 $200,000 $250,000 1992 1998 Married New Widows Widows Source: Weir et al. 2002. The same study used HRS data to investigate the economic consequences of a husband’s death for women’s poverty rates (Weir et al. 2002). Although the HRS was not designed to collect extensive retrospective data on events prior to a participant’s entry into the study, it does include questions about the timing of marriages. From this, research- ers calculated for all widows surveyed in 1998 the date at which they most recently became widowed, and thus the length of time they had been wid- owed. For women widowed 2 or more years, the poverty rate was essentially the same for widow- hood durations up to 11 years. However, the pov- erty rate increased substantially over the course of widowhood, rising to 22 percent for those widowed more than 20 years (Figure 3-9).