For folks without enough cash to retire, one key seems obvious: keep employed. But life often gets in the way. Health issues make it unbearable to work, or they lose a profession and can’t find another.

How Grandchildren Botch the Best-Laid Retirement Plans

Here’s another factor that disturbs the best intentions: grandchildren.

“Women are more likely to retire when their children have kids, according to a new study from American University business professor Robin Lumsdaine and strategy consultant Stephanie Vermeer. If women age 58 to 61 are helping to care for their grandkids, they are 29 percent less likely to be working full-time compared to women who aren’t grandmothers.”

Given recent trends, that signals trouble. Over the last 30 years, grandparents have taken a more active role in child care — a trend that accelerated after the stock market crashed in 2008.

“Mature women in the 58-to-61 age group are likeliest to stop working to care for a grandchild, Lumsdaine’s study says, but younger grandparents also cut back. Grandparents ages 51 to 54 who help with child care tend to work 21 percent less than those without grandchildren.”

A new baby — rather than, say, a discharge or former retirement plans — is the catalyst pushing grandmothers to offer help with child care, the study suggests.

“Looking at data before the financial crisis, the study found that, whether they have a job or not, women were 70 percent more likely to be providing care after a grandchild is born.”

“These women pitch in not just because they love their grandchildren and like spending time with them, but because their children need the help with parenting, Lumsdaine says.”

The study, recently accepted for publication in the journal Demography, didn’t look at the behavior of men. Women are still more likely to be the ones caring for grandchildren on a regular basis. Nonetheless, Lumsdaine says some grandfathers may also be influenced to retire by the arrival of grandchildren.

The cost of early retirement may be higher for women than men, however: Women live about five years longer on average, which means their savings have to stretch that much longer. At the same time, they tend to earn less, and they’re more likely to interrupt their earning years to stay home with kids.

If grandchildren are getting in the way, that’s immense problem, both for individual families and for policymakers. Better child care options and more flexible jobs might make it easier for 60-somethings to stay in the workforce. Until then, any proposals to raise the retirement age would be extra tough on grandmothers.

Source: ll By Ben Steverman