If you’re contemplating retirement, you’ve probably given a lot of thought to its impact on your finances. But have you considered how retiring might affect your health?
The latest in the debate over whether retirement improves or worsens health appears in the current issue of The Journal of Human Resources. Its conclusion: “Results indicate that the retirement effect on health is beneficial and significant,” writes Michael Insler, an assistant professor of economics at the U.S. Naval Academy.
The boost to your health is comparable to reducing the risk of being diagnosed with diabetes by 25%, for those of retirement age, Insler concludes.
Better Health Behaviours
In an interview with Next Avenue, Insler acknowledged that his conclusion “in some sense is counter-intuitive,” since, he says, a common notion is that “oh, people retire and they kind of lose their will to go on.”
If retirement does benefit health, why is that so? “I think the obvious hypothetical answers to that question are health behaviours,” says Insler.
Retirees have more time to invest in their health, he writes in the Journal. “It may be easier for them to quit smoking or to be more physically active when not burdened by the work-week grind.”
Insler based his findings on an analysis of data from the University of Michigan Health and Retirement Study, sponsored by the National Institute on Aging, which surveys a representative sample of 26,000 Americans over age 50 every other year.
He found that of the respondents who ever reported smoking, about 69% reported doing so in the survey that took place two to four years before they retired. But only about 56% said they were still smoking two to four years after they retired.
Insler also found that people were more likely after retirement to exercise vigorously for at least 30 minutes three or more days a week. Two to four years before retirement, about 48% of survey respondents said they exercised that much; that proportion increased to nearly 52% two to four years into retirement.
Same Data, Different Conclusions
But what if you really love your work? Might not retirement make you “lose your will to go on,” as Insler put it?
“Job satisfaction isn’t really something that I looked closely at,” he says. “It could be part of the story.” But, Insler says, “It’s less about your stress and satisfaction and more about the time you devote to your health upkeep.”
Although Inas Rashad Kelly and her co-authors used the same Health and Retirement Study data as Insler did, their analysis reached a different conclusion. In a paper published in 2008, they found that retirement affected health adversely.
The fact that their conclusions based on the same data set diverged from Insler’s “points to the complex and multifaceted nature of the issue at hand,” Rashad Kelly, an associate professor of economics at Queens College, part of the City University of New York, told Next Avenue.
Social Security Age
Retirement’s negative effect on health was especially strong among people who were forced, or encouraged, to retire and those who said they weren’t particularly enjoying their spouse’s company, Rashad Kelly and her co-authors found. But the effect was weaker among retirees who said they voluntarily retired, had stressful jobs, remained physically active and continued to socialize.
Economists trying to assess the ramifications of raising the age at which retirees can begin collecting Social Security are especially interested in whether health improves or declines in retirement.
If retirement exacerbates common, expensive health problems, then raising the eligibility age for Social Security might make sense. Such a move could help encourage people to work longer, reducing the strain on Social Security and Medicare. If health tends to improve after retirement, however, then getting people to continue working by raising the eligibility age for Social Security might reduce expenditures for that program but shift them to Medicare.
“We conclude that raising the retirement age for Social Security purposes may not have been such a bad thing,” Rashad Kelly says. “Yet we certainly do not propose altering the age one begins to receive much-needed health care through Medicare, and our results do not suggest that Medicare costs will go up on average if people work longer.”
Insler emphasized that it’s difficult to predict the health effects of retirement on individuals. “I’m trying to calculate an average impact for a population,” he says. “Does it mean it will necessarily happen to them? No.”