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We Americans aren't that great at delayed gratification. So it's not surprising that most of us bail out of the workforce as soon as we qualify for Social Security benefits, or at least not long thereafter. The average retirement age for women in the U.S. is 62, according to Boston College's Center for Retirement Studies, and the average man retires at 64.

Some people don't have much choice, of course. They get laid off or disabled, or a spouse gets sick and needs their help.

But plenty of people who could stick it out don't. Some probably share the thinking of a reader who told me he planned to bail as early as possible:

"Which is really better? A smaller Social Security check starting at age 62 that you are still young enough to enjoy for years? Or a much larger Social Security check beginning at 70 that you get for a much shorter period and then just gets signed over to the nursing home or assisted-living facility where you wind up?"

Liz Weston

Liz Weston

The problem is that retiring early can be an expensive mistake. You're locking in a dramatically lower Social Security benefit for the rest of your life. Tapping retirement funds, rather than letting them grow, greatly increases the risk you'll run out of money.

So here's the good news: You may not have to choose between fun and sufficient funding.

The good folks at T. Rowe Price have crunched the numbers and discovered something surprising: Many people can stop saving for retirement at age 60. Instead, they can start using the money that would be going for retirement contributions to travel, spend time with the grandkids and enjoy their hobbies and anything else they were planning to do in retirement.

The only catch: They can't quit work.

The key to this "practice retirement" is putting off the day you tap into Social Security and your savings, so that both can grow. The result is more money, both in your 60s and beyond.

The T. Rowe Price research discovered that retirement contributions in your 60s don't make nearly as much difference to your wealth as delaying the day you start withdrawals:

  • Social Security benefits grow an average 8% a year between age 62, when you're first eligible, and age 70, when your benefits max out. In other words, the size of your check could nearly double, and it's guaranteed for the rest of your life.
  • The longer you delay retirement-plan withdrawals, the less you need to save. You might need $1 million to retire comfortably at age 62 if you wanted to replace 75% of a $75,000 annual salary. Wait until age 67, and you would need $675,000. Wait until age 70, and your required nest egg would be $525,000.

So you can use the money you might otherwise save to start having more fun.

T. Rowe Price uses a hypothetical couple, John and Mary Smith, both 60, to illustrate. The Smiths earn $100,000 a year and have $500,000 saved. If they retired at 62, they could count on $30,700 a year in combined Social Security benefits plus a $21,100 initial withdrawal from their savings -- the maximum amount they could take while still having a reasonable chance of not running out of money.

Those two sources of income combined would replace only 52% of their pre-retirement income.

Instead, they decide to work longer but suspend their $15,000 annual retirement contributions starting at age 61. With more money to enjoy life, continuing to work doesn't seem like such a raw deal.

Even without contributing a dime to their retirement savings in their 60s, they can still retire at 66 with more money -- $40,700 from Social Security and $27,300 from their savings, or nearly one-third more income. If they wait until they're 70, they can replace nearly 90% of their pre-retirement income -- all while spending tens of thousands of dollars more than they did in their 50s.

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Now this approach won't work if you got a late start or got wiped out and have hardly anything saved by age 60. But you don't have to be a "1 percenter," either.

If you've saved an amount somewhere around five times your annual income by the time you're 60, this approach should work, said Christine Fahlund, T. Rowe Price's senior financial planner.

"It won't work if you've only saved two times your annual income," Fahlund said. "The sweet spot is somewhere between four and eight times your income."