Making the Case for Working Longer
Remaining on the job for a few more years may not appeal to many older Americans who long to retire.
But in the above video, a compelling case for working longer is made by Steven Sass, an economist with the Center for Retirement Research, who also edits this blog.
Sass explains that delaying retirement improves a retiree’s financial security in three critical ways:
- The worker can continue to save money for a few more years and will have more time to earn investment income on his savings.
- For each year he works past age 62, he’s also increasing the size of his future Social Security checks by about 7 percent to 8 percent.
- Working longer reduces the number of years in retirement that must be paid for.
For those who don’t have a pension and haven’t saved enough, working longer may be the only viable solution.
Full disclosure: The video was produced and recently posted online by Fidelity & Guaranty Life, which is a corporate partner of the Center for Retirement Research; the Center funds this blog. To hear Sass being interviewed about other topics, including why people don’t use 401(k)s and how to draw down one’s retirement income, click here.
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