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Back to Work: Expectations and Realizations of Work After Retirement

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  • Nicole Maestas

    (RAND)

Abstract

This paper analyzes labor force re-entry after retirement in an effort to understand whether these “unretirement” transitions are largely unexpected (perhaps resulting from failures in planning or unexpected financial shocks) or planned (perhaps representing a more complex retirement process). Nearly one-half of retirees follow a nontraditional retirement path that involves partial retirement and/or unretirement, and the unretirement rate among those observed at least five years after their first retirement is 24 percent. The unretirement rate is even higher among those retiring at younger ages (as high as 36 percent among those retiring at ages 51-52). I find that unretirement was anticipated for all but nine percent of retirees. If anything, expectations err on the side of excessive pessimism about the future rather than unwarranted optimism. Unretirement appears to be qualitatively similar to partial retirement and there is some evidence of a substantial correlation in the post-retirement labor supply transitions of married couples.

Suggested Citation

  • Nicole Maestas, 2004. "Back to Work: Expectations and Realizations of Work After Retirement," Working Papers wp085, University of Michigan, Michigan Retirement Research Center.
  • Handle: RePEc:mrr:papers:wp085
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    File URL: http://www.mrrc.isr.umich.edu/publications/Papers/pdf/wp085.pdf
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    References listed on IDEAS

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    1. Michael Hurd & Susann Rohwedder, 2003. "The Retirement-Consumption Puzzle: Anticipated and Actual Declines in Spending at Retirement," NBER Working Papers 9586, National Bureau of Economic Research, Inc.
    2. John Ameriks & Andrew Caplin & John Leahy, 2007. "Retirement Consumption: Insights from a Survey," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 265-274, May.
    3. Michael D. Hurd & Susann Rohwedder, 2003. "The Retirement-Consumption Puzzle Anticipated and Actual Declines in Spending at Retirement," Working Papers DRU-3009, RAND Corporation.
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    Cited by:

    1. Helen Levy & Kristin Seefeldt, 2008. "How Do Lower-Income Families Think about Retirement?," Working Papers wp195, University of Michigan, Michigan Retirement Research Center.
    2. Nicole Maestas & Xiaoyan Li, 2006. "Discouraged Workers? Job Search Outcomes of Older Workers," Working Papers wp133, University of Michigan, Michigan Retirement Research Center.
    3. Monika Bütler & Olivia Huguenin & Federica Teppa, 2005. "Why Forcing People to Save Retirement May Backfire," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 05.05, Université de Lausanne, Faculté des HEC, DEEP.
    4. David Blau & Tetyana Shvydko, 2011. "Labor Market Rigidities and the Employment Behavior of Older Workers," ILR Review, Cornell University, ILR School, pages 464-484.
    5. Monika Bütler & Olivia Huguenin & Federica Teppa, 2005. "Why Forcing People to Save for Retirement May Backfire," University of St. Gallen Department of Economics working paper series 2005 2005-09, Department of Economics, University of St. Gallen.
    6. Lucie Schmidt & Purvi Sevak, 2006. "Taxes, Wages, and the Labor Supply of Older Americans," Working Papers wp139, University of Michigan, Michigan Retirement Research Center.
    7. John Laitner & Dan Silverman, 2007. "Life-Cycle Models: Lifetime Earnings and the Timing of Retirement," Working Papers wp165, University of Michigan, Michigan Retirement Research Center.
    8. Kristin J. Kleinjans & Jinkook Lee, 2006. "The link between individual expectations and savings: Do nursing home expectations matter?," Economics Working Papers 2006-05, Department of Economics and Business Economics, Aarhus University.
    9. Monika BÜTLER & Olivia HUGUENIN & Federica TEPPA, 2004. "What Triggers Early Retirement ? Results from Swiss Pension Funds," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 04.04, Université de Lausanne, Faculté des HEC, DEEP.
    10. Steven Haider & Mel StephensJr., 2006. "How Accurate are Expected Retirement Savings?," Working Papers wp128, University of Michigan, Michigan Retirement Research Center.
    11. Joshua Congdon-Hohman, 2006. "The Impact of Health Insurance Availability on Retirement Decision Reversals," Working Papers wp137, University of Michigan, Michigan Retirement Research Center.
    12. David M. Blau, 2008. "Retirement and Consumption in a Life Cycle Model," Journal of Labor Economics, University of Chicago Press, vol. 26, pages 35-71.
    13. Kevin E. Cahill & Michael D. Giandrea & Joseph F. Quinn, 2006. "A Micro-level Analysis of Recent Increases in Labor Force Participation among Older Workers," Working Papers 400, U.S. Bureau of Labor Statistics.

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