Timing to Retire – Timing to Die? A Prospective Cohort Study on The Effects of Early Retirement and Long Term Survival.

Hilke Brockmann, Jacobs University Bremen
Rolf Mueller, Universitat Bremen

We undertake a prospective cohort study to assess the selective and protective impact of early retirement on life expectancy by accounting for age, sex, health and social status at retirement. Results are based on 130 703 members of Gmünder Ersatzkasse (GEK), a German compulsory health insurance, who retired at the age 50-65 between January 1990 and December 2004. We find significantly higher mortality risks among pensioners with reduced earning capacities than among old-age pensioners who either exited from the labour market at 56-60 or 61-65 for both sexes. However, people who retire early and have no health problems do not experience lower long term survival than people who retire late. For women, early retirement even lowers their mortality risks significantly by 25%. Pension reformers should take these selective and protective differences of early retirement into consideration when cutting back pension programs and increasing retirement age.