Competing Demands: Financially Dependent Children and Parental Retirement Expectations

Joanna Kling, University of Maryland
Joan R. Kahn, University of Maryland

Decreasing income security, lower pension wealth, and other wealth reductions have all contributed to the recent increases in the retirement age in the U.S. But there is also growing recognition that diverse and often disrupted family experiences (e.g., divorce, dependent children) may disadvantage older adults as they approach retirement. In this study we examine how family demands shape retirement expectations of older adults. We ask whether the presence of financially dependent children of any age affect parents’ feelings about when they can retire. We use the 1998 wave of the Health and Retirement Study (HRS) to first examine the cross-sectional relationship between financially dependent children and parents’ subjective probability of working full-time after the age of 65. Then, using fixed-effects models, we model changes over time in retirement expectations as a function of changes in the financial needs of children.