Pension decisions in a changing economy: Gender, structure, and choice

Objectives. As responsibility for financial security in retirement becomes more individualized, understanding the distribution and determinants of sav ings behavior grows in importance. Employed men and women often gain access to their pension assets when they change jobs. La this study gender differ ences in pre-retirement access to and disposition of accumulated pension as sets are examined. Methods. The authors used data from the Health and Retirement Study to mode l pension participation, disposition of pension assets, and use of cash set tlements derived from a pension plan in a previous job. Logit models provid ed estimates of gender differences in access to pensions and the preservati on of pension funds for retirement. Results. Women were less Likely to have participated in employer-sponsored pension plans; more likely to cash out accumulated pension assets when they changed jobs; and, when job changes occurred at relatively young ages, equ ally likely to spend the settlement. However, by their late 40s, women were more likely to save the settlement, a net gender difference that increased with age at which the settlement was received. Discussion. The structure of employment compensation continues to place wom en at a disadvantage. Gender differences in earnings and Fringe benefits no t only affect current financial status, but also cast a shadow over future financial security. Although the gender gap in pension coverage has been re duced, women with pensions have access to lower benefits and less in accumu lated assets. As these continuing deficits are addressed, enhancing women's tendency to save pension assets for retirement can help them build financi al security.