Decision Making Retirement

To fully understand older men’s and women’s experience of retirement, it is necessary to define what the term retirement means. A commonly used definition is that retirement is an ‘‘age-related withdrawal from active working life.’’ Of course, defining what constitutes an ‘‘active working life’’ is not so simple. Does it mean paid employment only? Should leaving employment because of job loss, disability, or caring for a sick family member constitute retirement? At what age does leaving an active work life constitute retirement?

Some researchers have tried to bypass these questions by simply allowing survey respondents to define themselves as either retired or not retired. The disadvantage of this approach is that the definition of retired will not be the same for everyone. Some people who are still working may consider themselves retired if they are receiving a pension from a previous job. Others who have been out of the labor force for many years to care for children and elderly relatives, or because they themselves are disabled, may not consider themselves retired even though they are well past the age when many people retire.

Different definitions of retirement lead to different conclusions about the retirement patterns of women and men. Defining retirement as ‘‘not working or looking for work’’ at specific ages always counts more women than men as retired at each age. However, if one looks at self-reported retirement, women are often less likely to be retired than men. The major source of difference is the nonmarket work of women, including caregiving responsibilities for children, parents, spouses, and other relatives, as well as housekeeping tasks culturally expected of women. For example, one study found that over 20 percent of women in their fifties and early sixties were not in the labor force due to reasons other than retirement, compared with only 8 percent of men. At the same time, more men than women considered themselves to be retired.

As there is no single best definition of retirement, it is appropriate to tailor the definition of retirement to whatever question is being asked. If one is interested in when workers decide to collect pensions and/or Social Security benefits, it is appropriate to treat retirement as an event. Another kind of research focuses on the economic and social well-being of retired people. In this case, retirement is considered to be a stage of life rather than an event. Most such research considers everyone who has reached a stated age, usually sixty-five, as retired, regardless of whether they continue to work. Less commonly, two or more criteria are combined. For example, only people over sixty-five who are not in the paid work force may be included in the retired population. Multiple definitions of retirement are useful in addressing specific questions about differences in men’s and women’s decisions about leaving the paid work force, and about their economic well-being after the age when people’s active working lives usually end.