Do the Sick Retire Early? Chronic illness, asset accumulation and early retirement

TitleDo the Sick Retire Early? Chronic illness, asset accumulation and early retirement
Publication TypeJournal Article
Year of Publication2007
AuthorsM. Miah, S, Wilcox-Gök, V
JournalApplied Economics
Volume39
Issue15
Pagination1921
Call Numbernewpubs20071002_AppliedEcon.pdf
KeywordsHealth Conditions and Status, Net Worth and Assets, Retirement Planning and Satisfaction
Abstract

Our objective is to determine how chronic illness affects asset accumulation and retirement. Previous studies have found that poor health leads to early retirement, but those studies failed to look at the indirect impact of chronic illness on retirement. Using data from the Health and Retirement Study, we define an illness as chronic if the individual reports having asthma, cancer, heart disease, stroke or diabetes for four or more years. We first estimate how a chronic illness influences asset accumulation. We then estimate how asset accumulation and current poor health influence retirement. We observe that the vast majority of the chronically ill population do not report their general health to be poor nor do they report functional limitations in activities of daily living. Nevertheless, our results indicate that chronic illness leads these people to accumulate fewer assets during their working years and consequently retire later. Neither researchers nor policymakers discussing the many critical issues surrounding illness and retirement have addressed this issue.

Endnote Keywords

Chronic Illness/Assets/Early Retirement

Endnote ID

18020

Citation Key7159