In a recent study by human resources consulting firm Willis Towers Watson, about 25% of American workers said they expect to retire at age 70 or later. But while retiring later in life may not be ideal from your perspective, here are a few late retirement benefits that might change your mind.
1.Your savings will last longer – According to a recent study the average size of a retirement account is about $95,000. While that is certainly a good sum of money, the average applies to those workers between 30-50 years of age. Meanwhile, Americans are living longer these days. According to the Social Security Administration, the average 65-year-old man today can expect to live until 84.3, while the average 65-year-old woman can expect to live until 86.6. Therefore that sum of $95,000 is not going to be very good for someone about to retirn that may live until their 80’s.
2. Your Social Security benefits will get a boost. – Waiting until your full retirement age means you’ll get to collect your Social Security payments in full, but if you hold off past your full retirement age, you’ll get an 8% boost in benefits for every year you delay, up until age 70. But aside from allowing you to delay claiming benefits, working longer can also help you increase your full benefit amount. Your Social Security payments are based on your top 35 years of earnings. Most people, however, earn more at the end of their careers than at the beginning. If you work a few years longer at a higher salary, you’ll knock out some of your lower-earning years for a higher average overall.
3.You won’t get bored as fast – According to a 2016 TD Ameritrade study, 24% of baby boomers and 35% of millennials said that being bored or not having enough to do in retirement was a major concern. And it’s a legitimate worry. A study by the Institute of Economic Affairs found that retirement increases the probability of suffering from clinical depression by 40%, and increases the likelihood of a physical ailment by 60%.
Feel free to contact the office if you have further questions on retirement.
Written by: Doug Rodrigues