Insurance Through Marriage: Case of Parental Long-Term Care Shocks and Social Security Claiming

Abstract

Married individuals may be better placed to mitigate various lifecycle shocks than singles. We find evidence of valuable insurance through a spouse by looking at parental long-term care provision at older ages. Utilizing longitudinal data from the Health and Retirement Study, we empirically show that parental long-term care provision initiates early Social Security claiming and retirement for married adult children providing care. At the same, we find that spouses of care providers delay benefit claiming and labor supply exits, resulting in a potentially net ambiguous effect of these shocks on total household retirement income.

Keywords: Social Security, Informal Care, Retirement, Marriage, Insurance

JEL Classification: J12, J14, J26, H55