These days, more and more people are putting off retiring by the time they reach 65. Instead, these Baby Boomers are opting to continue working until they are a bit older, usually by the time they reach 70. There are a variety of reasons why they are delaying retirement, with one of the chief reasons being that they truly love their jobs and want to continue to be productive in them for a longer period of time. Of course, retiring past the standard 65 years old carries a number of benefits. It is worth exploring these advantages to determine whether it’s wise to begin planning to retire later in life.
You Can Earn More Money
One of the most obvious benefits of delaying when you retire is that you can earn more money. This is because, naturally, the longer you work, the more money you put in toward the time when you eventually retire. Many people believe that their standard of living will decrease after they stop working. In addition, the longer you hold off on withdrawing funds from your retirement accounts, the more interest they will accrue over time. Over the course of a few years, that money can really add up. You also will not have to downgrade your lifestyle if you put off retirement for a few more years.
Higher Social Security Benefits
If you wait until you are 70 years old to retire, you can collect a higher social security benefit. Legally, you can begin collecting when you reach 62 years of age, but your monthly benefit is reduced by 30 percent. By the time you reach 70, when you begin collecting social security, you can earn an additional eight percent per year. In other words, if you were to claim at 66, your monthly benefit would be $1,000. If you were to claim at 62, however, you would only receive $750. Planning ahead and waiting to collect your social security benefits at 70 would increase your monthly benefit to $1,320.
Longer and Healthier Life
Individuals who put off retiring until a later age tend to be happier and healthier overall, which can increase their life expectancy. Working longer keeps your mind sharp and keeps you feeling useful and productive. Additionally, the longer you work, the longer you can continue to receive health benefits paid by your employer if the company provides them. These health benefits are much better than options you would need after you retire, which you would have to pay for out of your own pocket. This is especially true if you are not yet old enough to qualify for Medicare.
Allows You to Explore New Career Opportunities
Just because you decide you want to put off the time you eventually retire, it doesn’t mean you have to stop working altogether. If you have worked for the same company at the same job for many years but are burned out, you might want to try your hand at new career opportunities. Many people chase dreams and start their own businesses. Perhaps there is something you’ve always wanted to do that involves something you truly love and believe in. This is the time to embark on it. Some people choose to get a job on a part-time basis, which allows them to continue collecting for when they eventually retire but allows them to stay busy and earn money.
These are all compelling reasons why you might want to wait to retire. Weigh out the benefits and decide whether this is the right path for you. A well thought out retirement plan will allow you to feel confident when choosing the "right time" for you to retire- we can help you pursue your goals.