A study from a team of researchers at Oregon State University shows that the longer you wait to retire, the longer you will likely live. So if you are planning to put off retirement until after 65, get your retirement plan ready — you’ll want to make sure you have planned to afford the extra longevity! (Though, actually, everyone should make sure they plan for adequate longevity.)
The longevity delta for a delayed retirement is striking. The research found that among “healthy retirees, a 1-year older age at retirement was associated with an 11% lower risk of all-cause mortality.”
The study looked at 2,956 participants who were working in 1992 and retired sometime between 1993 and 2010. Healthy retirees were 11 percent less likely to die per year past retirement age. And people who said they were not healthy at the time of retirement showed a similar decrease in mortality.
What’s more, the study found that “there was no evidence that the effects of retirement age on mortality were modified by socio-demographic characteristics,” like wealth, race, gender, or education level, “suggesting that the beneficial effect of retiring late may be universal across different socio-demographic profiles.”
There are a lot of theories about why some people live longer than others. Some studies have purported to show that staying married, owning a dog, or visiting art museums are the keys to a longer life. Other studies show a link between higher educational attainment or living in a “blue” state and longevity.
Of course, exercise is often linked to longer life, either walking or running.
And having money doesn’t hurt: A study published in January, 2020 estimated that the wealthiest people live an average of eight and a half more years than the poorest people in their study. Mmmm … maybe the people who own dogs, visit art museums, and have more advanced degrees also happen to have more money?
Retiring later also means you will probably have saved more for retirement.
The findings of the 2016 study suggest that the most profound reason people who retire later live longer is the same reason people in Okinawa, Japan have the longest life expectancies. In Japanese it’s called “ikigai,” which literally means “life worth,” and implies “something or someone that gives a person a sense of purpose or a reason for living.”
The authors of the Oregon State study explain why working longer may result in a longer life: “One possible explanation is employment is a key component of individuals’ identity that provides them with substantial financial, psychosocial, and cognitive resources.” “Additionally, retirement could be a stressful life event associated with cognitive decline, difficulties in daily activities, morbidities, anxiety, and depression.”
Work gives life purpose to many folks, and the longer you delay the transition out of the purposeful context of work, the better off you are.
Some of us love our work and intend to keep going as long as possible. Others are stressed out and want to get away from their current employment A.S.A.P. Still others are in jobs that are so physically taxing that an early retirement is necessary.
If you want to reap the benefits of work, how can you stay in the workforce as long as possible? Here are some ideas:
If it is the longevity enhancing aspects of work that you are after, you can retire and find a different kind of job doing something you love.
Social scientists call your ability to make money at a job as your “human capital.” Your ability to run a spreadsheet or manage employees is the capital your employer leverages to make their business profitable.
As you approach retirement age, you can leverage your human capital to build alternative sources of income and life purpose. The oldest tried and tested way to transition human capital is to take a skill or hobby and make it a post-retirement job.
- If you are handy around the house, you can invest your time and savings into rental properties.
- If you have more people skills than material skills, you can make an extra room in your house into a rental or B&B.
- People who are skilled at writing and editing, get freelance gigs using a freelance referral site like Upwork.
The key to successfully building post-retirement purpose that also creates income is making sure what you’re doing is something you love.
No one says that working full time is necessary to reap the benefits of work. Reduce your hours and reap the rewards of both work AND retirement.
Here are 7 tips for getting a great part-time retirement job.
Maybe you just need a break from work to recharge.
Sabbaticals are a growing trend for people near retirement age in need of a reboot. Learn more about a pre-retirement sabbatical.
More than ever, workers over 50 are looking toward careers in the nonprofit world, seeking a second chance at purposeful work.
Here are 6 tips for making an impact.
And here are 8 more ideas about the benefits and options for work near retirement age.
Plus:
When researchers say postponing retirement leads to a longer life, they are not saying you should grind away at a job that kills your soul. The key finding of the Oregon State study is that life satisfaction — ikigai in Japanese — comes from having a purpose.
One of the main benefits of work is that it keeps you engaged with other people. Work is often a social endeavor.
Researchers in Australia found that retirees who are members of groups experience better life expectancy than retirees who aren’t, and the positive benefits increase with the number of groups. Reaching out to colleagues and friends who are close in age to face the transition from work to retirement should be a part of your retirement plan.
Having places to go and things to do — on a regular basis — is key to staying vital.
Here are some tips for keeping up a retirement schedule!
Like it or not, work keeps your brain active. When you retire, you want to be sure to stay engaged in activities that keep your brain active and on its toes!
Use it or lose it!
Work is comforting because you know you have a paycheck to cover life’s expenses. Retirement can be stressful if you don’t have a solid funding plan you really believe in.
Use the award-winning NewRetirement Planner to create and maintain a comprehensive plan. Everyone can find confidence and ease about their retirement finances.
Whether you are planning to live longer because you are working longer or because you are formulating a life with meaning — ikigai — a long life requires an extra solid retirement plan.
True though that retirement planning can feel confusing when one of the biggest factors — your longevity — is completely unknowable.
Here are a few strategies for creating a plan for a long life:
Most retirement calculators and even many retirement financial advisors use simple averages when calculating your retirement financial needs.
You need to understand this and make sure you are okay with the calculations.
The NewRetirement Retirement Planner allows you to enter a goal age for you (and your spouse if applicable). With this tool, you can control how long you want to be able to fund your retirement.
You may want to create different retirement plans based on an optimistic life expectancy and a pessimistic life expectancy. For example, you might have a solid financial plan that takes you from age 65 until you are 80 years old.
And your back up plan might be to use home equity or some other source of wealth thereafter.
It is important that you assess and refine your retirement plans regularly. Quarterly is recommended, but you should check in anytime your finances and health change.
Retirement planning is not something you do once and forget. It should be a part of a routine.
Most people approaching retirement are focused on figuring out how much savings they need.
However, you might be better off figuring out how much income you need every month and then taking steps to guarantee that income for your lifetime.
The two most popular sources of guaranteed lifetime income for retirement are:
- Social Security: Social Security is income that is guaranteed for life — no matter how long you live. Because it lasts for as long as you do, it may be worth delaying the start of Social Security to maximize your monthly benefit. Try different options in the NewRetirement Planner.
- Lifetime Annuities: Lifetime annuities can be another source of guaranteed lifetime income. If you can afford a lifetime annuity, they can enable you to stop worrying about running out of money before you die.
As Spock said: “Live long and prosper!”
