Retirement, Leisure Satisfaction, and Financial Satisfaction

In this study, we use data from the 2008, 2012, 2016, and 2020 waves of the Health and Retirement Study (HRS) to examine the relationship between retirement and financial satisfaction, while performing cross-sectional and longitudinal analyses. Our cross-sectional findings show that fully retired individuals are more likely to be financially satisfied than those who are not retired. However, transitioning into retirement does not change financial satisfaction, while returning to the workforce is associated with a decline in financial satisfaction. We also explored the role of leisure satisfaction in explaining retirement and financial satisfaction, and found interesting results in both cross-sectional and longitudinal analyses. While leisure satisfaction is positively related to financial satisfaction in both cross-sectional and longitudinal analyses, its moderating role differs, with partially retired individuals with high leisure satisfaction showing lower financial satisfaction. Our findings show that retirement is not just an economic stage, but also emotional and sociological one, which highlights the importance of aligning finances and lifestyle expectations.