Is Nontraditional Work at Older Ages Associated with Better Retirement Security?

Abstract

Holding nontraditional jobs—which provide neither health insurance nor retirement benefits—might be helpful to those looking to extend their careers for financial reasons. This study uses the Health and Retirement Study to determine the extent to which workers in traditional jobs, with less retirement security when they reach the cusp of retirement, are more likely to move to nontraditional jobs in their mid- to late-60s than those who are more secure. It then examines whether nontraditional jobs improve retirement security by ages 67–68. The results indicate that workers in traditional jobs who reach age 62 with less projected retirement income, relative to their pre-retirement standard of living, are no more likely to engage in nontraditional work after age 62 than those who are better prepared. Among those workers who are at risk of not maintaining their pre-retirement income level in retirement, however, nontraditional work appears to move them closer to retirement security.