Complex marital histories and economic well-being: the continuing legacy of divorce and widowhood as the HRS cohort approaches retirement.

We use data from the first wave of the Health and Retirement Survey (HRS) to examine the marital histories of this cohort of women and men on the verge of retirement. The legacy of past increases in divorce rates is evident in the complex marital histories of HRS households and the relationship between those histories and current economic status. Couples in a first marriage now make up only one-quarter of black households and fewer than half of all white and Hispanic households. In over one-third of all married-couple households, at least one spouse had a previous marriage that ended in divorce or widowhood. These couples have significantly lower incomes and assets than couples in first marriages. Contrary to the popular notion that private and public insurance better provide for the security of widows than divorced persons, currently widowed households and couples in which the prior marriage of one spouse had ended in widowhood are no better off than are their divorced peers. This holds true for both black and white households. From a single cross-section, one cannot tell what caused these differences in income and wealth across marital status groups although it is clear that women and blacks spend a higher percentage of their lifetime outside of marriage than do men and whites. We also speculate from estimates of widowhood expectations for a subset of married respondents that underestimating the chances of widowhood--because both men and women overestimate their chances of joint survival--may be a factor in the relatively low economic status of widows. Because couples in life-long marriages have been the traditional standard upon which marital property reform and the survivorship rules of private and public programs are based, their diminishing importance among all households raises concern about the protection provided by these institutions against the long-term economic consequences of past and future marital dissolution.