It is often assumed that retirement changes life circumstances drastically. Therefore, retirement is also called a “critical life event”. However, previous research showed no clear findings – some studies found an increase in life satisfaction, others found a decrease, and further studies found no changes in life satisfaction at all.

ISS researcher Martin Wetzel and his colleagues Oliver Huxhold and Clemens Tesch-Römer from the German Centre of Gerontology (DZA) recently analyzed data from the German Socio-Economic Panel Study (SOEP). This data set was used to track changes in life satisfaction from six years prior to eight years after retirement transition for more than 3,300 men and women.

The authors show in their study that people who had been unemployed prior to retirement were more satisfied with their life after retirement than before. In contrast, people who had been working prior retirement showed only minor increases in life satisfaction. The researchers understand this finding as indication that retirement is a socially accepted and predictable life event. For people who had been working, retirement was not associated with major changes in social status. However, people who had been previously out of work perceived retirement status as a relief from the stigma of being “unemployed.”

Additionally, the study finds that in the first eight years after retirement, people with higher education were more successful in maintaining their life satisfaction than people with lower education. The scientists interpret higher life satisfaction as ability to successfully establish new sustainable daily life routines. Hence, in particular, the higher educated more easily adjust to the new challenges of retirement since they have successively collected more resources over the course of their life. This results in increasing differences of life satisfaction between higher and lower educated people in the first eight years after retirement. The authors sum up, “while retirement leads in the short-term to a decrease of social inequalities, in the long-run they increase again.