Income and Life Satisfaction Among Voluntary vs. Involuntary Retirees

Lauren Elizabeth Baxter, University of Tennessee - Knoxville

Abstract

This field study examined relationships of income and life satisfaction among retirees, their perceptions of whether their decisions to retire were voluntary or involuntary, and their stated reasons for retiring: “push” (to exit unsustainable work situations) or “pull” (to pursue more attractive options). Based on prior research, hypotheses predicted that voluntary / involuntary choice would moderate the relationship of income and life satisfaction, and that the relationship would vary as a function of "push" vs. "pull" reasons for retiring. A screened, national sample of 1,043 U.S. retirees completed an online survey that assessed satisfaction with multiple life domains, reason for retiring, demographic characteristics, family income, and perceived financial control. Results showed that voluntary retirees had, on average, higher income, life satisfaction, and perceived financial control than those who saw their retirements as involuntary. Type of reason for retirement did moderate the relationship between income and life satisfaction, but in an unexpected way. Based on decades of research on the relationship of control and stress, the hypothesis predicted the correlation between income and life satisfaction would be weakest in voluntary "pull" retirees, and strongest in the involuntary group. Instead, the relationship was strongest among voluntary "push" retirees (r=+.35). These surprising results highlight the importance of further research on perceived control over retirement on common predictors of life satisfaction in retirement.