Delay Retirement — Live Longer, Better

Finally a reason to delay retirement that is not because you didn’t sock away enough money! If we live long enough, at some point our functional status begins to erode. The good news is that working past age 65 may stall this gradual decline while retiring earlier may be a risk factor for a shorter life.

In a recent U.S. News article, Chenkai Wu, the lead author in a study at Oregon State University, explains that “delayed retirement, which could potentially mean keeping cognitively and physically active and socially engaged, may, at least partially, help delay the onset of that decline.” Mr. Wu examined data collected from 1992 through 2010 through a long-term study of U.S. adults led by the University of Michigan and funded by the National Institute on Aging. He narrowed his focus on people who began the study in 1992 and had retired by the end of the study in 2010. “Most research in this area has focused on the economic impacts of delaying retirement. I thought it might be good to look at the health impacts.”

According to the announcement on the OSU.edu website, researchers found that healthy retirees who worked a year past age 65 had an eleven percent lower risk of dying. The unhealthy retirees who also worked a year past age 65 had a nine percent lower risk of death. Delaying retirement can have a positive impact on your life span regardless of your health.

This study caught my eye when I read an article by Emily Brandon. She is a senior editor at U.S. News & World Report and the author of a new book, Pensionless: The 10-step Solution for a Stress-Free Retirement. It’s a good read with useful information some of which I have not seen in similar consumer books about retirement planning. I like the retirement planning checklist that includes a comprehensive list of important ages for retirement planning plus important calendar year deadlines. These ages and dates cover trigger points for retirement fund distributions, Social Security deadlines and Medicare deadlines.

A lot of baby boomers are internet-savvy and prefer to get their information online. If that is you, check out Emily’s blog at http://money.usnews.com/money/blogs/planning-to-retire. She cranks out quality blog posts on relevant and useful retirement topics about every four days. You can find additional articles on money.usnews.com/money/retirement. Her twitter username is @aiming2retire. If you are a twitter person, you might want to follow her for announcements of her latest blog posts and articles.

In a recent blog post, 5 Websites Every Retiree Needs to Visit, Emily explains the advantages of familiarizing yourself with these five websites prior to and after your retirement date. Emily explains how to sign up for Social Security and Medicare from your computer, how to get the best prices for your medications covered by Medicare Part D and how to assess healthcare coverage if you are thinking about retiring before your Medicare eligibility date.

In a February 2016 article on usnews.com, Emily writes about two ways to increase your Social Security income. The commonly known way is to delay signing up for Social Security, but Emily explains a second way to increase your benefit. “Social Security payments are calculated using the 35 years in which you earn the highest salary. If you earn more now than you did earlier in your life, this year’s higher salary will be factored into the calculation. And if you haven’t yet worked for 35 years, working an extra year will prevent a zero from being averaged into your retirement benefit calculation and dragging down your retirement payouts.” Replacing a zero earning or lower earning year with a currently higher earning year will permanently increase your benefit for your lifetime.

In my line of work, I occasionally hear clients exaggerate and complain about needing to work for the rest of their lives to make up for having to share their retirement next egg in their divorce. The Oregon State University study puts a positive spin on working past age 65. You may get to live longer with additional good quality years when you delay retirement. When I add that to the financial benefits of delaying retirement, I can now reply to my clients, “Lucky you!”