Consumption and Age

The expenditure patterns of workers and nonworkers were also studied by Thomas Moehrle, who drew his sample of people age 62 to 74 from the 1986–1987 CEX. Moehrle found that two-thirds of the sample was not working while one-third was still employed. The sample was further subdivided into low-, middle-, and high-income groups. Moehrle found that the head of household of the working households was younger and had attained higher levels of education than their nonworking counterparts. Across all income groups, those not working were more likely to own their homes without mortgages and to spend more on food prepared at home and on health care. Transportation expenditures were higher for the working households, and the working households had notably higher expenditure shares for retirement, pension, and Social Security contributions across all income levels.

Rubin and Nieswiadomy (1994) studied retired and nonretired households headed by those age 50 and older using 1986–1987 CEX data. Their sample was further subdivided into married couples, single men, and single women. They found that nonretired married couples spent 45 percent more than retired couples, while nonretired single men spent 65 percent more than retired men, and nonretired women spent 50 percent more than retired women. The retired households spent a significantly greater share on food at home, housing, rent, utilities, household operations, and health care. The nonretired households allocated a greater share to food away from home, alcoholic beverages, owned and other dwellings, home furnishings, apparel and services, all transportation categories (except public), entertainment, education, miscellaneous gifts, and insurance. Rubin and Nieswiadomy found that spending on health care was positively correlated with education levels. Retired single women, nonwhites, and those over 75 were given larger shares of cash gifts and contributions.