Abstract: This paper examines the savings and consumption expenditure effects of a 3-year lift in the early retirement age (ERA) for women in their 40 and 50s. The changes in expected pension wealth and expected future labor earnings induce households to adjust their saving plans. Using the German Income and Consumption Survey data, we exploit the immediate increase in the ERA between women born in 1951 and 1952 and find a reduction in the household saving rate. This finding provides empirical evidence of dissaving if the loss in pension wealth can be absorbed by the adjustment in labor supply. Our results also indicate that rising early retirement age affects saving rate via changes in consumption expenditures rather than changes in disposable income.