Determinants of the Discrepancy of Planned Versus Actual Retirement Age: A Comparison between Hispanics and Non-Hispanics in the United States

Background and Purpose: In the context of an aging population, working longer seems an attractive option for many Americans. Overall, the average retirement age in the U.S. has increased over the last few decades. However, the rate of increase for Hispanics is lower than for non-Hispanics.  Most studies about retirement timing have focused on middle-class Whites – commonly excluding race and ethnicity or just including them as control variables.  Further, few studies have focused on the determinants of discrepancies between planned versus actual retirement age, however, such discrepancies are important to understand, as they can be a useful indicator of a lack of control over the retirement decision. Thus, this study aims to explore, from a life-course perspective, the determinants of discrepancies between expected versus actual retirement age comparing Hispanics versus non-Hispanics. This is especially important because Hispanics are one of the fastest growing population groups in the U.S.

Methods: Data for this study was drawn from the Health and Retirement Study, a longitudinal study with biannual interviews since 1992, of a nationally representative sample of people aged 50+. A unique record of respondents who self-reported being retired at wave at 1994 or later, who were working and specified a planned retirement age or the intention to ever retire at any wave before retirement, were selected. This yielded a sample of 9,588 participants. The outcome is the discrepancy between planned and actual retirement age (1= retired before they planned; 2= retired when they planned, and 3= retired after they planned). Multinomial regression analysis was used to test hypotheses.

Results: For Hispanics, an extra year of education increased the odds of retiring when planned relative to retiring earlier than planned. However, for non-Hispanics an extra year of education decreased the odds of retiring when planned relative to retiring earlier than planned. Contrary to findings in the non-Hispanic group, for Hispanics, subjective health status at retirement and having a physically demanding job were significant predictors of retiring when planned relative to retiring earlier than planned, and daily limitations at pre-retirement, health coverage and health status during childhood were not. Among Hispanics, years of education and daily limitations at retirement were not significant predictors of retiring after planned relative to retiring earlier than planned, but they were significant for non-Hispanics. Whereas having a physically demanding job was a significant predictor among Hispanics, but not among non-Hispanics. And, having a stressful job and health coverage were significant predictors for both groups. Overall, for both Hispanics and non-Hispanics, higher SES and worse health were negatively associated with retiring when they planned or after they planned compared to those who retired earlier.  

Conclusions and Implications: Differences between Hispanics and non-Hispanics found in this study can provide important insights into how life trajectories and working barriers in later life can alter expected pathways out of work. This study provides insights to practitioners and policy makers to design/modify policies targeted to all ethno-racial groups to help increase their retirement preparedness and accomplish their retirement intentions.