Maternity Timing, Wealth Accumulation, and Economic Well Being in Retirement

Jason S. Seligman, University of Georgia
Yoko Mimura, University of Georgia

Given that the United States’ recent history is marked by the large scale entry of women into the workforce and large changes in employer pension plans, family planning impacts should be expected. During the past 30 years, large and simultaneous changes to both family and retirement planning have emerged. This paper which considers fertility and savings choices in the context of these changes. We consider how household structure, household wealth, labor force participation, and pension type relate to fertility and its timing empirically. We estimate the impact of fertility on life-cycle savings in a Defined Contribution environment using a simulation tuned to reflect the characteristics of initial empirical work. After considering the positive empirical evidence, we address the normative issue of optimal fertility within a life-cycle model which incorporates both fertility and savings for old age, and the possibility of fertility impacts for U.S. public pension finance.