American workers are retiring later now than in the past three decades.
The current average retirement age among US retirees is age 61, up from age 57 in 1991, according to a Gallup Poll released in July. If Americans who are still working retire when they plan to, the average retirement age will increase even further in the coming decades. The poll showed the expected retirement age among non-retired workers is age 66, up from age 60 in 1995.
Several factors likely influence the increased expected retirement age. Changes to Social Security payouts enacted in the 1980s are coming into play for today’s workers of retirement age. The changes also provide incentives for people to stay employed longer to maximize their monthly benefits after they retire.
The full Social Security benefit retirement age is 66 if you were born from 1943 to 1954. The full retirement age increases gradually if you were born from 1955 to 1960, until it reaches age 67 for anyone born in 1960 or later.
If you delay receiving social security benefits beyond your full retirement age, the amount of your monthly retirement benefit will continue to increase up until age 70. There is no financial incentive to delay claiming social security benefits after age 70.
Longer life spans for US adults may also be a factor in later retirement ages, with workers perhaps seeing a need to save more money, anticipating a retirement that could last 20, 30, or more years. Current increases in the cost of living also likely factor in.
I read the Gallup retirement age poll results on the eve of my 61st birthday. Frankly, I cannot imagine retiring at this point in my life. I feel like I’m just getting started! My husband has a very different view of the perfect retirement age. The sooner the better, from his perspective.
If early retirement is for you, you can get Social Security retirement benefits as early as age 62. However, your monthly benefits will be reduced if you start receiving benefits before your full retirement age.
Beyond the financial benefits of working longer, there are documented health benefits as well.
One study published in the Journal of Epidemiology and Community Health found that working for one additional year after age 65 was associated with an 11% lower risk of mortality, leading researchers to suggest that “prolonged working life may provide survival benefits among US adults.”
Research also suggests a job you don’t particularly care for can still be better than no job at all. Even a less-than-ideal work situation is better than social isolation because the workplace can provide cognitive challenges that keep the mind active and healthy, according to an article published by the National Bureau of Economic Research.
It is possible to keep your brain active and to maintain social connections in retirement, but it requires intentionality without the workplace to provide you with a ready-made source of human contact and mental challenges.
If retirement is for you and you’re looking for ways to stay connected to community, explore purpose, new possibilities, and maximize your latter decades of life, the Lynn & Freeborn Kellogg Campus for Creative Aging is a great place to explore new possibilities and connections. The Campus themes of creativity, purpose, growth, and learning can open up a new world of social connection and renewed purpose. Find information at CampusforCreativeAging.org or by calling Amy at (269) 982-7748.
Everyone’s retirement is unique. Beyond deciding when to begin receiving retirement benefits, there are other factors that can affect your Social Security benefits. You can explore your Social Security benefit options at www.ssa.gov.