Saturday, February 21, 2015

I don’t Know Anyone Waiting Until 70 to Retire

I keep reading and hearing advice about waiting until age 70 to retire.  And there was even an article on MainStreet.com entitled, “Retirement Delayed: Why age 70 is the new 65”.  It notes, “More Americans are holding off on retirement until they reach their seventies. A recent research paper published by the Center for Retirement Research (CRR) at Boston College reveals that Social Security’s real retirement age is now 70.”

But for those with whom I associate, this isn’t the case.  Far from it in fact.  Most people I know who are retiring or nearing retirement are either doing so at or before age 65.  So why are they not heeding the advice to delay their retirement?

Social Security payments will go up…if you live that long
The Mainstreet.com article I previously mentioned states, “Delaying your Social Security benefits has the potential to increase the total amount of income you'll receive throughout your lifetime by $100,000 or more.”

To me, and many other future retirees, the key word in that quote is “potential”.  Sure, you might recoup all or even more than the amount in benefits you’d receive by retiring on time, but how long will that take?  While longevity and family health history can certainly play a part in this equation, figuring out just how much longer you’d have to live to make higher payment amounts worth the missed five years of monthly payments worthwhile may be a worthy endeavor before assuming delaying payments is the right move. 

Part-time work
Some of the retirees that I know find part-time work is a strong possibility in their retirement years.  And while this work may not be through a regular employer, it garners them income through activities that they enjoy doing and that make them feel useful and/or productive.

This not only makes for a more meaningful and satisfying retirement in which there is a maintained sense of purpose, but it provides further financial stability (even if the income made from such activities isn’t substantial compared to previous income levels) that can allow for an on-time retirement.

Family is a powerful force
Family can be powerful force when it comes to determining a retirement age.  Many of the people I know are retiring to be closer to family – especially grandchildren.  However, there is more to the retirement question than just proximity when it comes to family.

A family can also be a critical support system that can add security to a retirement and bolster confidence in an early retirement decision.  Knowing that family is there to provide support services (transportation, home repairs, yard work, monetary security, etc.) as well as a potential living situation, should it come to that, can add to the conviction that an earlier retirement may be a better move than delaying those golden years.


Disclaimer:

The author is not a licensed financial professional.  This article is for informational purposes only and does not constitute advice of any kind.  Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.

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