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More Than Half of Workers Expect to Work Past 65. Here's Why You Should Plan to Do the Same
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More Than Half of Workers Expect to Work Past 65. Here's Why You Should Plan to Do the Same

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More Than Half of Workers Expect to Work Past 65. Here's Why You Should Plan to Do the Same

Early retirement has been in the news a lot lately, with stories of 30- and 40-somethings socking away half of their income in the hopes of leaving the workforce well ahead of their peers. But not everyone expects to retire early. In fact, 52% of workers today expect to work past the age of 65, according to a recent Transamerica survey. This sentiment is particularly prevalent among baby boomers, 68% of whom expect to or are already working beyond age 65.

Of course, not everyone gets the option to work past 65. Health issues, layoffs, and other hiccups could actually force you into retirement sooner than you'd like. But assuming you have the option to keep plugging away, here are three good reasons to continue working well after your 65th birthday has come and gone.

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1. Americans are living longer

The life expectancy of a 65-year-old today isn't the same as it was 10, 20, or 30 years ago. If you extend your career, there's a good chance you'll still have plenty of time to enjoy retirement. But you'll also lower your risk of boredom and the mental health issues that can come with it by not pulling the plug on your career too soon.

2. You'll have more time to save

The typical senior spends $46,000 a year in retirement and collects about $18,000 a year from Social Security. The gap between those two numbers needs to be bridged by savings, and the longer you work, the more opportunity you'll have to pad your 401(k) or IRA. Saving more money won't just give you the option to travel more or spend extra on leisure as a senior -- it'll also buy you some protection against mounting healthcare costs, long-term care, and other expenses that may be unavoidable as you age.

3. You'll shrink your Social Security benefits if you claim them too soon

Many people associate age 65 with retirement because that's when Medicare eligibility kicks in. But full retirement age for Social Security purposes -- the age at which you're entitled to your full monthly benefit based on your earnings history -- is somewhere between 66 and 67, depending on the year in which you were born.

If you stop working at 65, you may have to sign up for Social Security at that point, thereby shrinking your monthly benefit for life. On the other hand, if you work until at least full retirement age, you'll have a more robust benefit to look forward to. And if you delay your Social Security filing past full retirement age, you'll increase your benefits by 8% for each year you do, up until age 70 -- and that's a good way to boost your retirement income for life.

Some people want nothing more than to retire early, while others are forced to go that route. But there are plenty of good reasons to work a bit longer than you may have initially planned to, so think about the many things you stand to gain by delaying retirement before making your final decision.

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