Reasons Why Americans Are Working Past Retirement Age

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

Most of us can't wait until the day that we become eligible to retire, but unlike our parents' and grandparents' generations, retirement age may not come so soon anymore. While 65 has been accepted as retirement age for quite some time, the percentage of Americans that are 65 years of age or older and STILL working has risen to just about 20%, and that's the greatest percentage of people since before Medicare was first established in the 1960s.

Now onto the question everyone is asking - why are so many older Americans still working? Aside from the fact that there are job opportunities out there that people of this age can handle, here are some of the major reasons why people are not choosing to leave their jobs:

Paychecks are still needed.
Most employers today use retirement plans such as 401(k)s, which are primarily funded by the employees themselves. For those who have not saved enough in their 401(k) to retire comfortably, a job at this age is still a necessity since the paychecks are needed to help them cover even the most basic of expenses. Even for those who do have enough saved to retire at 65, many elect to keep working so that they can create a financial safety net for themselves when they eventually decide to leave the workforce.

People are living longer.
Did you know that the life expectancy for a man who turns 65 today is 5.5 years longer than it was for a man who turned 65 years old in 1970? The life expectancy for females has increased too! That said, those who feel like they have a little more oomph left in them may choose to stay at their job longer since longer life expectancies means more time to enjoy retirement.

Social Security benefits could increase.
A large majority of people claim Social Security benefits as soon as they stop working, however, to become eligible for full benefits, you'll need to be 66 or 67, depending on when you were born. If you choose to delay your claiming of benefits, though, you could see your benefit grow by approximately 8% each year until you turn 70 - that's a lot more money in your pocket!

Although more people are working past retirement age, everyone is different and will have their own time that is right to leave the workforce - in a previous blog, we covered five signs that suggest you're ready for retirement.

If you know that you'll be retiring in the near future, now is the time to work with a financial planner and make sure that all of your finances are in order - let us help! We are staffed with several financial planning professionals that specialize in retirement planning, so we can work with you to make sure you are on the right path for a successful retirement.

To speak with an advisor, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

Information above courtesy of Emerald Connect.