About the research
Retirement is a milestone that can lead to changes in health, social relations, finances, allocation of time and can therefore affect poeple’s satisfaction with life. However, there is little evidence as to whether personality and gender have an impact on retirees’ well-being.
Researchers from the University of the Thai Chamber of Commerce and Washington State University conducted a study which provided some of the first longitudinal evidence on whether personality can affect how well people cope with retirement and whether such personality impact depends upon gender. The study is part of a wider project exploring personality traits and health satisfaction, and received £2,500 of funding from the University of the Thai Chamber of Commerce.
The research is based on previous studies on retirement satisfaction and utilises the Big Five factor model which consists of five personality traits: agreeableness, conscientiousness, extraversion, neuroticism, and openness.
“We hypothesize what could be the specific role of each personality trait when individuals retire, potentially providing a better understanding of how distinct subgroups of individuals react to the experience of retiring” summarised the authors.
Findings show that retirement increases leisure satisfaction for both males and females, but doesn’t necessarily raise life satisfaction and income satisfaction. Results reject the hypothesis of ‘homogeneous’ behaviour across distinct subgroups of individuals, suggesting that certain personality characteristics affect the well-being of female retirees, but personality does not seem to matter in how males experience retirement. More specifically, the findings indicate that female retirees high in openness or low in conscientiousness are likely to experience greater satisfaction with overall life when compared to other females with average levels of these personality traits.
The research used data from wave 15 of the British Household Panel Survey (BHPS) and wave 3 of Understanding Society, two UK-wide longitudinal datasets.
Researcher Dusanee Kesavayuth commented on the two studies “The richness of the data from BHPS and Understanding Society made such inquiry possible, allowing us to analyse how two sources of individual heterogeneity – personality and gender – impact the well-being effect of retirement.”
In order to test how personality impacts the wellbeing effect of retirement, the sample selected consisted of individuals between 50 and 75 years of age. Alongside socioeconomic information and measures related to satisfaction with different aspects of life, the BHPS and Understanding Society collect data on personality, allowing the researchers to construct a two-wave panel. Starting with an unbalanced panel of 9,289 observations, they eliminated respondents with missing answers for the questions required for the analysis. This process of constructing the data set resulted in 5,597 unique individuals (2,563 males and 3,034 females) and 7,837 observations.
They also used eligibility ages for basic state pension in the UK as instruments for retirement, as retiring is sometimes considered to be a choice and therefore may be relative to individual-level characteristics.
The researchers then used fixed effects panel data analysis to estimate the causal effect of retirement on satisfaction, with overall life and domains of life in the presence of personality characteristics.
Findings for policy
The authors highlight the potential impact of the study’s findings “Complementing previous work in economics and psychology, these findings may be useful for informing policy choices for older individuals and in their own planning. For instance, counselling programs for retirement should consider how to tailor the message and support to different personality types and gender.”
“In highlighting these differences among older individuals, we aim to encourage new research that could further our understanding of individual heterogeneity in retirement. Replicating the aforementioned findings for different countries to explore the potential role of cultural differences could be another valuable source of information for use in retirement preparation courses.”
To read the report in full:
Kesavayuth, D., Rosenman, R. and Zikos, V. (2016) ‘Retirement, Personality, and Well-Being’, Economic Inquiry, 54(2), pp. 733-750. DOI: 10.1111/ecin.12307
Publications and outputs
Understanding Society (1 March 2016) ‘Personality and gender can affect our reactions to retirement’. Available at https://www.understandingsociety.ac.uk/2015/03/05/sickness-and-health-between-men-and-women