behind closed doors: financial inequalities within older couples

DEBBIE PRICE & RACHEL STUCHBURYDINAH BISDEE AND TOM DALY

BSG 2009, 2nd – 4th SEPTEMBER

INSTITUTE OF GERONTOLOGY

[email protected]@kcl.ac.uk

[email protected]@kcl.ac.uk

Behind Closed Doors: Financial inequalities within

older couples

2Background – ‘Behind Closed Doors’

Project

How do the financial resources of men and women differ within and between older couples? What are the drivers of difference? Quantitative Study

How do older couples view, manage and negotiate about money? What (if any) are the implications of within-couple unequal ownership of financial resources for the well-being of older people and their families? Two Qualitative Studies – focus groups and couple/individual

interviews

What ageing and ageist discourses and practices are prevalent in the formulation of government policy relating to money? How do these relate to the money practices of older couples? Policy Study

www.householdmoney.co.uk

Project Website

Portal for information on older people and later life:finance, care, health, housing, advice, wills and end of life issues

Findings

Outputs

Web Survey

Researcher Blogs

Public views

About the project

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Within couple financial inequality

Understanding human behaviour; challenging the social order; influencing policy

Feminist critique of the family: men have financial resources and women are dependent

Implications for power, control and gender relations within and outside the household:

• Women’s access to resources and decision making among older couples will be limited

• Women will be satisfied with unequal access to resources• Women will sacrifice consumption within households• Women may experience poverty within non-poor households• Power and control within the household is connected to power and

control outside the household

Implications for well being in widowhood/after divorce & vulnerability to poverty and social exclusion

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Research Questions (Project)

Present a nationally representative statistical picture of financial inequality between and within older couple households, investigating how different sources of income in later life contribute to or ameliorate financial inequality within households;

Through multivariate analysis, investigate the correlates of later life inequality and consider whether within-couple inequality in later life is associated with measures of quality of life;

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Outline

Data considerations & epistemological issuesCouple descriptives & financial decision

makingGendered financial inequality of partnered

older peopleFinancial inequality within partnerships

Exploratory analysis of correlates

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ELSA

People aged 50 and over and their younger partners, living in private households in England.

Sample drawn from households that had previously responded to the Health Survey for England (HSE) in 1998, 1999 or 2001.

Fieldwork: March 2002 and March 2003. Repeated interviews, historical data added.

Wave 1: approx 12,000 people; IFS derived financial variables (with imputed data)

Project spec: analysis of Wave 1 of ELSA; hope in future to add histories, and act as baseline data for longitudinal analysis

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Data Collection: Income and Assets

Research questions require that information about income and assets is collected separately for men and women in a couple, but:

“Later in the interview, I would like to ask some questions about finances generally, for example income and savings. Can I just check, do you and name keep your finances totally separate?”

If person is living as part of a married or cohabiting couple and has indicated finances are shared between the couple, questions go to respondent on behalf of the couple. If person is living as part of a married or cohabiting couple and has indicated finances are not shared between the couple, questions go to each respondent separately.

Asset information – only collected at benefit unit level even though wide disparities in ownership between partners Even apart from gender issues within the household, increasingly

important for understanding financial well being in later life, especially increasing prevalence of second & subsequent marriages where spouse may not inherit

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Epistemological Issues

Project raises epistemological issues with the way data on assets, wealth has been collected and reported

• Relatively few couples would say finances were “totally separate” – powerful norm to present ‘jointness’ within partnerships

• Joint does not mean joint, covers a whole range of arrangements including some that are quite separate

• Couples unaware of each others’ finances• Secret money

But income: at least attempts are made to collect separate data Assets: information not collected for each couple unless they have declared

finances “totally separate” • in analysis, income from assets has been apportioned equally between partners – no other options

‘Benefit Unit’ discourse pervades data collection

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ELSA: focus on benefit unit

Individual section on work and pensions collects information from individuals about their work and pension income Not used in IFS derived financial variables, which focus on benefit units

Income and assets section (used in IFS derived financial variables) collects information largely from one person in the couple about either

individual or joint income (but not about individual occupational or personal pensions, broad brush on work income);

if couple did not say that there income is totally separate, one person only answers and then all assets are considered joint assets (whether individually or jointly held); income from assets is also considered joint regardless of how held.

In IFS derived variables, all assets and income from these are attributed to both parties if one person is answering for both.

Large amounts of imputed data (but clearly flagged and transparent) Data can’t be used to examine individual asset ownership within couples,

except for couples who answer separately; query individual income where proxy answers, and income from assets can’t be apportioned.

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Older Couples

4,503 heterosexual couples (9,006 people)• 4,025 with financial data about both partners

1,960 couples where one partner is over 65• 1, 817 with financial data about both partners

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Ages Percentage

Both under 60 40%

Man under 60, woman 60 – 64 2%

Woman under 60, man 60 – 64 9%

Both 60 – 64 6%

Man under 60, woman 65+ 1%

Woman under 60, man 65+ 4%

Man 60 – 64, woman 65+ 1%

Woman 60 – 64, man 65+ 7%

Both 65+ 31%

Marital Status of ELSA Couples

All Where woman <60

Where woman 60-64

Where woman 65+

First marriage for both 67% 57% 70% 80%

Remarriage for both 9% 10% 9% 7%

First marriage for one, remarriage for other

9% 12% 6% 5%

Married, status not known for both

7% 12% 12% 7%

Cohabiting, both divorced 2% 3% 2% 0.5%

Cohabiting, other combinations 7% 6% 1% 1%

100% 100% 100% 100%

n= 4,501 2,365 670 1,466

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Source: ELSA, Wave 1, 2002/3, couples where at least one member is over 50

Living Arrangements% all Where

woman under 60

Where woman 60 – 64

Where woman 65+

Couple only 71.8% 56% 85% 92%

Couple and grandchild/ren 0.6%

Couple, adult child/ren and grandchild/ren

1.0%

Couple, their parent/s, adult child/ren & grandchild/ren

0% (1 cp)

Couple with adult child/ren (all over age 30)

4.4% 3% 7% 6%

Couple with adult child/ren (one/some under 30)

20.9% 38% 5% 1%

Couple and their parent/s 0.5%

Couple with parent/s and adult child/ren (one/some under 30)

0.3%

Couple with their parent/s and adult child/ren, all over 30

0% (1 cp)

Other 0.4%

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Separate or Joint Finances of Couples?

Under 60 60 – 64 Over 65

MEN IN COUPLES

Separate 17% 16% 18%

Joint 83% 84% 82%

100% 100% 100%

WOMEN IN COUPLES

Separate 18% 18% 17%

Joint 83% 82% 83%

100% 100% 100%

n= 1900/2365 731/670 1871/1466

No significant differences

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Source: ELSA, Wave 1, 2002/3

Who answered the Income & Assets Section?

Where couples declared joint finances, who answered for the couple?

Man answered IA 65%

Woman answered IA 35%

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Gendered issues of power and control 94% of cases: at least one of the couple answered the

financial questions; 5% missing; 1% other household member answered


Organisation of Money (Individuals)

Man looks after all except

woman’s personal spending

Woman looks

after all except man’s

personal spending

Man looks after,

woman gets

housekeepin

g

Woman looks after,

man gets house

Keeping

Share and

manage jointly

Keep finances complete

ly separate

Some other

arrangement

Declared Separate (18%)

21% 14% 31% 19% 14% 74% 15%

Declared Joint (82%) 79% 86% 69% 81% 86% 26% 85%

100% 100% 100% 100% 100% 100% 100%

All individuals (100%) 14% 22% 6% <1% 55% 2% <1%

n=8339 1200 1833 472 36 4564 208 26

Note: only one person answers this for the couple, even if finances totally separate – if separate, about half men, half women answer (‘first person to answer IA”)Data notes: need to ‘decode’ all answers as where finances are ‘joint’ the same answer can’t be attributed to both partners as it refers to the other in the ELSA dataset; where couples have ‘separate’ finances, they are coded as missing in the ELSA data if the other person was asked the questions, need to match couples, attribute, and ‘decode’ these answers; cannot compare answers given by partners within a couple

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Who has final say in big financial decisions?

Man Woman Equal say

Declared Separate Finances (18%) 21% 28% 15%

Declared Joint Finances (82%) 79% 72% 85%

100% 100% 100%

All individuals (100%) 18% 10% 73%

n=8,366 796 1490 6050

P<0.001Note: only one person answers this for the couple, even if finances totally separate – if separate, about half men, half women answer (‘first person to answer IA”)Data notes: need to ‘decode’ all answers as where finances are ‘joint’ the same answer can’t be attributed to both partners as it refers to the other in the ELSA dataset; where couples have ‘separate’ finances, they are coded as missing in the ELSA data if the other person was asked the questions, need to match couples, attribute, and ‘decode’ these answers; cannot compare answers given by partners within a couple .

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Distribution of income from private and occupational pensions for those in receipt, couples 65+

Outliers for men into the hundreds of thousands of pounds

72% of men in couples in receipt of some private or occupational pension income

28% of women in couples in receipt of some private or occupational pension income

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Distribution of income from paid work or business for those in receipt, couples 65+

Outliers for men up to £60,000

11% of men aged 65+ in couples in receipt of some income from paid work or business

7% of women aged 65+ in couples in receipt of some income from paid work or business

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Distribution of weekly income from state pension for those in receipt, couples 65+

94% of men aged 65+ in couples in receipt of some income from state pension

93% of women aged 65+ in couples in receipt of some income from state pension

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4% of men aged 65+ in couples in receipt of some income from state income support

1% of women aged 65+ in couples in receipt of some income from state income support

Income support is assessed at benefit unit level, but paid to the claimant

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Distribution of weekly income from state income support for those in receipt, couples 65+Source: ELSA, Wave 1,

2002/3

Gender differences in annual net income from private/occ pensions & paid work, men and women,

65+, in couples

Median, for those in receipt Median Gap Women as % of Men

Men Women

Net private/occ pension £4,104 £1,770 £2,334 43%

Net earnings/profits £3,334 £2,666 £668 80%

Pens+Earn £4,674 £2,052 £2,622 44%

Percentage in receipt

Net private/occ pension 72% 29%

Net earnings/profits 11% 8%

Pens + Earn 75% 34%


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Gender Differences in Net Weekly Income

All income, weekly, net, men and women in couples

Median Median gap

Median women's income as % of

men's

AGE Men Women

60 - 64 £212 £ 98 £115 46%

All 65+ £180 £69 £110 39%

n=

65- 69 £198 £77 668/600 £121 39%

70 - 74 £178 £67 544/429 £112 38%

75 - 79 £167 £60 368/252 £106 36%

80 - 84 £ 151 £56 193/125 £94 38%

85+ £159 £81 77/35 £ 78 51%

Source: ELSA, Wave 1, 2002/3Note: includes individual income from paid work, private and occupational pensions, state pensions, income support, state benefits, income from assets and all other sources of income. All income is measured at the individual level (although one partner often answers for both), except income from assets, which has been apportioned equally between partners.

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Quintiles of Individual Income, 65+ in Couples, according to sex

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Source: ELSA, Wave 1, 2002/3Couples where at least one member is over 65

Components of Net Weekly Income25


Relative Importance of Income Components

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Inequality of income within couples, (1+=65+)

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Distribution of Income Inequality within Couples

Percentile of share of joint income

Men

5th 40%

10th 48%

20th 56%

25th 59%

50th (Median) 70%

75th 80%

80th 82%

90th 87%

95th 91%

Percentile of share of joint income

Women

5th 9%

10th 13%

20th 18%

25th 20%

50th (Median) 30%

75th 41%

80th 44%

90th 52%

95th 60%

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Income inequality within couples, 65+

Women’s share of joint income*

Between 0% and 20% 24%





100%

n= 1,817Source: ELSA, Wave 1, 2002/3* Where at least one member of the couple is over 65

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Income quintile, age and within couple inequality

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Social class, age and within couple income inequality

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Man’s Social Class and Income Inequality

Her Male Partner’s Social Class, col %

Income share of woman

I II III IV V All

Between 0% and 20%

37 33 21 17 17 24%

Between 20% and 40%

43 44 50 53 53 49%

Between 40% and 60%

16 19 23 26 25 22%

Between 60% and 100%

4 4 7 4 6 5%

100 100 100 100 100 100%

n= 255 393 324 540 269 1,781p<0.001Source: ELSA, Wave 1, 2002/3

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Woman’s Social Class and Income Inequality

Her own Social Class, col %


I II III IV V All

Between 0% and 20%

6 21 27 24 24 24%

Between 20% and 40%

41 40 49 54 51 49%

Between 40% and 60%

44 32 20 19 21 22%


9 8 4 4 4 5%

100 100 100 100 100 100%

n= 255 393 324 540 269 1,781p<0.001Source: ELSA, Wave 1, 2002/3

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Educational qualifications, age and within couple income inequality

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Woman’s Education and Income Inequality

Her own Educational Qualifications, col %


Higher Educational Qual

School Leaving Educational Qual

Foreign or other

None All

Between 0% and 20%

22 31 23 23 24%

Between 20% and 40%

42 41 53 54 49%

Between 40% and 60%

27 24 23 20 22%


9 5 3 4 5%

100 100 100 100 100%

n= 396 510 119 765 1,790p<0.001Source: ELSA, Wave 1, 2002/3

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Health, age and income inequality within couples

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Marital status, age, and income inequality within couples

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Woman’s Marital Status and Income Inequality


Married, first

marriage

Re-married,

2nd or subs.

Cohabiting

All

Between 0% and 20%

25% 24% 7% 24%

Between 20% and 40%

51% 24% 36% 49%

Between 40% and 60%

21% 42% 48% 22%


4% 9% 10% 5%

100% 100% 100% 100%

n= 1,524 228 42 1,794p<0.001Source: ELSA, Wave 1, 2002/3

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Further Work

Understanding the role that different components of income play in within-couple financial inequality

Multivariate modelling of financial inequality within couples in later life Possibly adding lifecourse history data from Wave 2

Testing whether within couple financial inequality is related to quality of life outcomes e.g. marriage quality, health

Understanding the drivers of financial inequality between couples in later life

Considering explanations and implications arising from the qualitative strand of the project

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Conclusions

The financial contributions of men and women within older couples are very unequal, especially state pensions, private pensions and earnings from paid work

Older couples are poorer, but at all ages from 65 to 85, median partnered women’s income is about 38% of partnered men’s

Older partnered women dominate the lower individual income quintiles, and older partnered men the higher; private pensions are the main driver of difference

Within older couples, at all ages, women contribute about 30% to the couple’s joint income A quarter of women contribute between 0% and 20%, and only 5% more than 60%

Social class, education and marital status all play a (small?) part in explaining income inequality within the household; age, health and income quintiles seem to have little impact Multivariate analysis will help to understand the mechanisms at work

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Conclusions

The data suggests that gendered financial inequality within couples is a lifelong condition that men and women must find ways of accommodating

A substantial body of work on younger couples suggests that such inequality has implications for power, control and access to resources within relationships, as well as impacts on wider society

Through our qualitative work we hope to contribute to understanding the importance of age and ageing in these debates

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behind closed doors: financial inequalities within older couples

Documents