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Are “voluntary” self-employed better prepared for retirement than “forced” self-employed?

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  • Hershey, D.A.
  • van Dalen, Harry

    (Tilburg University, School of Economics and Management)

  • Conen, Wieteke
  • Henkens, Kene

    (Tilburg University, School of Economics and Management)

Abstract

When it comes to financial preparation for retirement, self-employed workers in many European countries face unique challenges not encountered by traditional wage earners. This is particularly true for self-employed workers because many self-employed individuals do not have large-scale access to employer-sponsored pensions, which are a mainstay of pension support for most workers in developed countries. In this investigation, we explored the saving practices and perceived future pension adequacy of self-employed workers aged 15–65 in Germany (N = 702) and the Netherlands (N = 655). Of particular interest for understanding saving practices was whether respondents felt that they voluntarily chose to become self-employed, or whether they felt “forced” to enter self-employment due to economic or labor market pressures. Forced self-employed individuals—some 25% of those who became selfemployed out of necessity—were found to be less likely to save for retirement than their voluntary self-employed counterparts, and they envisioned a less optimistic future pension scenario for themselves. Discussion focuses on the need to change institutional practices and public policies that place self-employed individuals at a disadvantage— particularly those who are driven into self-employment based on economic pressures and a lack of opportunities in the traditional labor market.

Suggested Citation

  • Hershey, D.A. & van Dalen, Harry & Conen, Wieteke & Henkens, Kene, 2017. "Are “voluntary” self-employed better prepared for retirement than “forced” self-employed?," Other publications TiSEM 039ee146-e32b-444a-a5c6-1, Tilburg University, School of Economics and Management.
  • Handle: RePEc:tiu:tiutis:039ee146-e32b-444a-a5c6-140439cbaa4c
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    Cited by:

    1. Nolan, Anne & Barrett, Alan, 2018. "The Role of Self-Employment in Ireland's Older Workforce," IZA Discussion Papers 11663, Institute of Labor Economics (IZA).

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