Many Americans Follow Nontraditional Paths to Retirement: Cognitive Ability and Personality Traits Influence This Process
Jul 30, 2018
Published in: Work, Aging and Retirement, Volume 4, Issue 1, (January 2018), Pages 52-66. doi: 10.1093/workar/wax030
Posted on RAND.org on April 03, 2018
This article describes an exploratory study that investigates the extent to which two sets of psychological factors, fluid cognitive ability and personality traits, predict late-in-life work and retirement outcomes. Using longitudinal data from the Health and Retirement Study, we first provide a detailed characterization of within-subject work-to-retirement pathways, spanning 14 years of data for each individual, and identify the most frequent pathway classes. We found that only 37% of workers followed the "standard" pattern of retiring completely from a full-time job. We then examined how cognitive ability and personality traits predict these work-to-retirement pathways. We found that individuals with better cognitive ability work longer, both in full- and in part-time jobs, and extraversion is a strong predictor of working longer, mainly in part-time jobs. These results are robust to the inclusion of many covariates, including demographics, health, socioeconomic status, and labor market variables. Although the observed patterns match individuals' retirement expectations to some extent, there also seems to be evidence of some surprise. Practical implications and suggestions for future research are discussed.