Retirement Security of Black and White Older Parents: An Investigation of Wealth Disparities and Transfers

• In Event: Asset-Building Polices, Economic Security, and Individual Development Over a Life Course

Abstract

Research Aim: This paper investigates the economic security of parents as they reach older age, applying an intergenerational lens of financial assets transfers with a specific focus on differences by race, gender, and economic position. Grounded in work on persistent racial and gender wealth disparities, the study extends the Leveraging Mobility Study (LM), a unique longitudinal qualitative interview study with Black and White low- to middle-income parents raising children in the 21st century. In this paper, we examine parents’ financial contributions towards retirement and their assessments of how they can plan for their retirement at different stages throughout their life course, especially as they respond to significant macroeconomic events such as the Great Recession and COVID-19 pandemic. 

Background: Extensive quantitative research documents racial wealth disparities. While this research offers valuable insights into trends of stratification and mobility, there is still much to learn about the role of wealth in the cross-generational processes of social reproduction. Relatively little qualitative research has been done in this area, leaving open questions on how race, socioeconomic status, and wealth affect families’ plans for and experiences of retirement, including people’s decision-making processes as they plan for their retirement. This study also adds a focus on parents in the context of raising and supporting their children, which is increasingly continuing further into young adulthood.

Data and Methods: Baseline data of the LM study were collected in 1998 from low to middle income parents of young children. Follow-up interviews were conducted post the Great Recession, in 2010-12 when the children were seniors in high school or had completed their high school education. A third wave of interviews currently implemented will allow us to delve deeper into revealing how families share and accumulate wealth intra- and intergenerationally, and, critically, how these decisions relate to the outcomes for two generations within these same families more than 25 years after the initial interviews. These data will provide insights into families’ complex decision-making processes, tradeoffs, and their retirement planning over close to three decades.

To situate the interviews within national trends, we will use data derived from the nationally representative Panel Study of Income Dynamics (PSID). The PSID has an intergenerational panel study design that will allow us to follow families with children from 1999 through 2021 (the last round of PSID data currently available). Analyses will depict national trends, by race and gender, on retirement security (measured by wealth and income), including SSA benefits, pension contributions and benefits, and intergenerational financial transfers (giving or receiving) over time. Combining the qualitative and quantitative data will provide strong evidence of trajectories, decision making, and actions by low to middle income parents in the U.S.

Currently in the process of collecting data, there are no results of these analyses yet. We expect that the Results will deepen the field’s understanding of how wealth, or the lack of wealth, shapes opportunities and family wellbeing over time and across generations – over the life course of the family.

 

Authors

• Tatjana Meschede, Brandeis University
  Presenting Author

• Sylvia Hotakainen Stewart, Brandeis University
  Non-Presenting Co-Author

• Manning Zhang, Brandeis University
  Non-Presenting Co-Author