Marriage and economic well being at older ages

Abstract

This paper provides new evidence on the wealth advantage of marriage. We analyze the relationship between a lifetime of marital status changes and wealth levels near retirement age. We consider type of change whether from divorce, widowing, remarriage, number and timing of changes, and duration in marriage. We document that lifetime marriage experiences of individuals nearing retirement are very diverse: only about one-half of all individuals experience one continuous marriage throughout their lives. We model the impact of marriage on wealth independent of lifetime earnings, mortality risk, risk aversion and other important confounding factors. Consideration of financial, housing, and public and private pension wealth reveal that unadjusted wealth differences between married, remarried and not married individuals are large; as duration of marriage increases, so does wealth; and lifetime earnings as well as future claims on public and private pensions explain most of the wealth differences by marital status for men but less so for women.