Does Spousal Retirement Affect Life Satisfaction? Evidence from Couples in Germany

In developed countries, policies increasingly aim to extend working lives by raising statutory retirement ages and tightening eligibility rules. However, these reforms often overlook the implications of retirement for individual well-being. While the relationship between retirement and life satisfaction has been widely studied, the effects of spousal retirement remain underexplored, particularly from a gender and order of retirement perspective. This paper studies the impact of individual and spousal retirement on life satisfaction among couples in Germany. Using data from the German Socio-Economic Panel (SOEP), fixed-effects (FE) and fixed-effects individual slopes (FEIS) models are employed to estimate these effects. The results show that individual retirement substantially increases life satisfaction for both women and men. In contrast, spousal retirement benefits men but leaves women either unaffected or negatively affected. Husbands report higher life satisfaction when they retire while their wives remain employed, whereas this configuration negatively affects women. In a context where women are younger than men in most couples, spousal retirement may disadvantage women while benefiting men, particularly when retirement occurs in response to a husband’s declining health.