Do Spouses Coordinate Their Retirement Decisions?

Introduction

The movement of married women into the labor market is transforming retirement behavior. A generation ago, when few married women spent many years in the labor force, it was relatively simple for spouses to coordinate their retirement decisions. Couples typically focused on the generosity of the husbands’ retirement benefits and the impact of his retirement decision on future benefits. Today, however, retirement decisions are more difficult to coordinate, because many women have accumulated substantial retirement benefits in their own names. As a result, many couples now need to consider how the decision to stop work will affect income and retirement benefits for both spouses. The evidence suggests that couples like to retire together and, since husbands tend to be older than their wives, the increased labor force participation of women may lead to later retirement of men. This brief examines retirement behavior and measures the extent to which husbands and wives appear to coordinate their retirement decisions…