Increasingly, Americans are pushing back their ideal retirement age. The age workers expect to retire rose from an average of 60 in 1995 to 66 in 2011, according to a recent Gallup poll. And a Harris Interactive survey released in July found that Americans age 55 and older plan to work until they're 69, up from age 64 in 2001.
Working longer has a variety of economic and social benefits. "At the bottom end of the socioeconomic scale, people need the money and the insurance to make ends meet, and at the upper end, people are working because they want to," says Joseph Quinn, a Boston College economics professor.
Here are 10 reasons you may want to consider delaying retirement:
More time to save. The years immediately before you retire are often some of the best years to save. That's because you'll likely earn more during these years than you did earlier in your career. And once children become financially independent, parents have a unique opportunity to significantly boost their retirement savings. Workers over 50 can delay paying taxes on an extra $5,500 in a 401k and an extra $1,000 in an IRA, compared with their younger counterparts. (Are you saving enough for retirement? Check MSN Money's calculator to find out.)
Fewer retirement years to finance. Many healthy baby boomers can expect to spend 20 or even 30 years in retirement. Postponing retirement means there will be fewer years without income from work that you'll need to finance. Even working part time in retirement can allow you to draw down your savings more slowly.
Continue to delay taxes. Withdrawals from traditional 401ks generally become required after age 70½. However, if you are still working and don't own 5% or more of the business sponsoring the retirement plan, you can continue to delay paying income tax on retirement savings within a 401k. Withdrawals from traditional IRAs will still be required, even if you keep working into your 70s. (How much will your 401k provide? Find out with MSN Money's calculator.)
Higher Social Security checks. Your Social Security payments will increase for each year you delay signing up between ages 62 and 70. A worker born in 1965 currently earning $50,000 per year can expect to receive about $1,340 per month if he or she begins collecting benefits at age 62, according to AARP's new Social Security benefits calculator.
That amount will increase to $1,915 per month if he or she delays claiming until 67, and to $2,374 monthly at age 70. The age you can claim the full amount you are entitled to is in the process of being increased from age 65 to 67, which means you will have to work longer than your parents did to get a comparable level of Social Security benefits.
Health benefits. Workers can't sign up for Medicare until age 65. Finding affordable individual health-insurance coverage, if you qualify at all, can be extremely difficult for people who lose the group coverage provided by an employer. Holding on to your job or finding a part-time job with benefits can be the most cost-effective way to find health insurance before age 65.
Improve your social life. Money isn't the only thing our jobs provide. We form friendships with colleagues and become part of workplace communities. "A lot of people have their main social interactions with their colleagues at work," says Jay Wintrob, the president and CEO of SunAmerica Financial Group. "They become friends and get to know one another's families, and work keeps them in the mix and being viewed as being productive."
