How Changes in Lifestyle During Retirement Affect Mental and Physical Health

• In Event: Mental Health

Abstract

Retirement represents a major life-course transition that can reshape health through changes in time use, stress exposure, and health behaviors. As policymakers debate increasing the retirement age to address fiscal pressures on Social Security, understanding the health consequences of retirement has become increasingly important. However, estimating the causal effect of retirement on health is challenging because retirement decisions are endogenous to individual health status. This study estimates the impact of retirement on mental and physical health and examines potential behavioral mechanisms. Using data from fourteen waves (1992–2018) of the Health and Retirement Study (HRS), we focus on individuals aged 50–75 with stable labor force attachment. To address endogeneity, we exploit exogenous variation in retirement timing generated by Social Security eligibility thresholds, using age-based eligibility as an instrumental variable for retirement status. We examine two primary outcomes: self-rated physical health and mental health measured using a rescaled CES-D index. We also analyze three health-related behaviors—exercise, smoking, and heavy drinking—and implement a mediation framework to assess whether behavioral changes explain the effects of retirement on health. We find that retirement leads to improvements in both mental and physical health, with larger effects for women. Among women, retirement increases mental health by 1.32 points and significantly improves self-rated health, while men experience smaller gains in mental health and no statistically significant change in self-rated health. Retirement also leads to substantial increases in physical activity, particularly among women, and increases heavy drinking among men, with no significant effects on smoking. Mediation analysis suggests that increased physical activity explains a meaningful share of the health gains, accounting for approximately 10% of the improvement in women’s mental health and 8.6% of improvements in self-rated health. Effects are larger among individuals in physically demanding occupations. These findings suggest that retirement can generate important health benefits, partly through increased engagement in health-promoting behaviors. As policymakers consider reforms that extend working lives, these results highlight potential trade-offs between labor supply and health. Policies that support healthy transitions into retirement, particularly for workers in physically demanding jobs, may help mitigate these trade-offs and improve well-being among older adults.

Author

• Sezen Ozcan Onal, SUNY Downstate Health Sciences University
  Presenting Author