Diversity in Family Life Course Patterns and Intra-Cohort Personal Wealth Disparities at Late Working Age

Nicole Kapelle, Humboldt Universität zu Berlin & Nuffield College
Sergi Vidal , Centre for Demographic Studies

This paper examines the importance of family life courses for personal wealth inequalities in later life and explores whether the deviation from the normative family pathway associates with long-term economic consequences. We extend prior research on the antecedents of economic wellbeing in older ages in two relevant ways. First, we use comprehensive accounts of the entire family live combining marital and fertility histories to identify relevant family trajectories. Second, we examine personal wealth instead of household wealth, as the former is increasingly considered a better measure for personal wellbeing and ensures comparability between individuals living in diverse household compositions. Along these lines, we propose the following main research question: How does the divergence to “traditional family trajectory” patterns impact wealth at older age? Empirically, we examine sequences of partnership and fertility episodes that span from early adulthood to pre-retirement age using multichannel sequence analysis and cluster analysis. This enables the identification of major family patterns, which we use to assess family paths that are linked to unequal wealth levels at age 51 to 59. The empirical analyses use longitudinal data from the German Socio-Economic Panel Study. Preliminary results indicate that a family pathway featuring a continuous, stable marriage with two children – the normative family pattern – associates with the highest levels of personal net wealth at older age. We also find that an increasing deviation from the standard trajectory leads to higher personal wealth penalties at older age. Larger penalties are observed in eastern Germany than in western Germany.

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 Presented in Session 2. Economic and Emotional Well-being across the Life Course