The unexpected benefits of delaying your retirement

You can build a bigger bank by working a bit longer, but there are other benefits as well.

The unexpected benefits of delaying your retirement

With older Australians increasingly concerned that greater longevity means their retirement savings may not go the distance, the thought of working longer and delaying retirement becomes more attractive.

While the financial reward of working longer is obvious, there are a number of less expected benefits that come with delaying retirement. Here are some of them.

Social engagement
My mother-in-law, who turns 72 this year, says she has no intention of retiring any time soon. She does clothing alterations from home and for various dry cleaning stores in the area. Working isn’t just about the money for her, but about maintaining a sense of social engagement as well. She isn’t alone in that regard. According to a YourLifeChoices survey, 24.5 per cent of respondents who were still working said they were doing do it to remain socially connected.

Making the transition easier
Working beyond retirement age, particularly in part-time employment, might provide you with the opportunity to think through some important retirement issues. For example, how will you go about filling in your time during retirement? It’s possible that working beyond retirement age might spark new ideas to making your retirement more interesting or lead to your engagement with new hobbies and interests.

Better for your health
There is increasing evidence that the payoff of working past the age of 65 may go beyond finance. Studies have linked working past retirement with better health and longevity. A 2016 study of about 3000 people suggested that working even one year beyond retirement age was associated with a nine to 11 per cent lower risk of dying during the 18-year study period, regardless of health. A 2015 study of 83,000 older adults over 15 years suggested that, compared with people who had retired, people who continued working beyond age 65 were about three times more likely to report being in good health and about half as likely to have serious health problems, such as cancer or heart disease.

Fewer retirement years to finance
According to YourLifeChoices research, the biggest fear for retirees is outliving their money. Although half the survey respondents said the reason they worked beyond retirement age was for the money, it also works the other way around. That is, you are closing the retirement gap in two ways at once. As well as building up a bigger bank of money for retirement, you are also reducing the number of years you will have to finance day-to-day without work income.

Did you work past retirement age? Aside from the financial benefits, did you discover any other advantages?


    Disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.


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    9th May 2019
    I worked in a casual capacity until turning 75. Even then I was reluctant to retire as I it gave my days purpose and provided me with invaluable social engagement.. However, my husband's increasing dementia and Parkinson's meant that he needed a higher level of care and supervision. Now I am pretty much socially isolated and getting older by the day!
    9th May 2019
    I believe there are a lot of self funded retirees that have to work part time just to generate an income that is approximately equal to those on a full aged centrelink pension. I am one anyway. Any comments ??
    9th May 2019
    Pretty sure financial circumstance (ie low incomes & high cost of living -current economy-prior to retirement will force many to work longer, not to mention the difficulty associated with applying for (& receiving the pension if you are an older Aust citizen)!! I'm 57 & would retire (from manual labour shiftwork) in a flash if i could get the old age pension NOW! Body is old a worn out, as is the brain from doing this gig 17yrs now, but to pay the basic bills there is absolutely no choice but keep going unfortunately :(
    9th May 2019
    John, if you are a SFR and working part-time yet only bringing in about the same as an aged pension then I'm guessing you missed out on pension due to the assets test. Perhaps you need to have a heart to heart with your advisor to see how you can rearrange your affairs to change your situation, your choice.
    12th May 2019
    thanks for replying farside. Dont have an advisor now as had too many bad experiences with fin. advisors; so now looking at alternatives.
    9th May 2019
    I think the gist is to stay busy and stay engaged with other people. Its really easy in retirement to do neither....although I never seem to have time to spare after my chores.
    Chris B T
    9th May 2019
    At 48 I was Told Your Becoming To Old In a Trade Related Job. That was along time ago now.
    So how is working beyond 65 going to work out.
    I tried for casual employment, offered at 2 hours a day 5 days a week with 30 to 45 min travel each way just stupid. No full day offering.
    This is the way some employers view older workers, nothing to do with willingness to work to a particular age.
    Every one's situation is unique, what is good for one is out of the question for others.
    9th May 2019
    Vote for Mr Shorten then because he has 'promised' jobs for the over 55s! He is even going to pay the employer to give you one, in fact you AND the kid next door.
    Chris B T
    9th May 2019
    As union leader/secret dealer is a major Problem.
    Any one Else But Him, can't Trust This Government Than You Do Not Want Shorten As Prime Minister.
    Brace Yourself He Will Be Worse Than Any Prime Minister We had before.
    Witnessed His Dodgy Dealings AS Union Leader.
    He is For Himself.
    As I'm self a funded Retiree his 55 plus job has little interest to me.
    9th May 2019
    Shorten does not have a Labor bone in his body.

    He has just hi-jacked the party for his own advancement.

    Rusted on LNP supporters are no better off - the forgotten people of Robert Menzies have once more been forgotten. We are all political orphans.

    ScoMo attacked modestly well-funded retirees - Shorten didn't object - Keating neither - another just like him (who comes out of the woodwork now and again to protect his record that of Thatcherising Australia from the Labor benches).

    Shorten now promises to make it worse by refusing franking credit refunds - ie forcing retired non-taxpayers to pay tax while letting much more properous people off altogether.

    It must be frustrating for Labor Party members - Shorten is just dreaming this stuff up as he goes along. Surely they would have expected to make input into a platform to put to the people - not have a bully-boy leader making it up at the last minute and being forced to go along with it for the sake of party loyalty.

    Destroy your ballot paper. It's the only way for retiree voters of either complexion to show the major parties that there's a swag of votes available for the asking. In the absence of lobbyists or donors batting for us it's the only thing they understand.

    Voting for independents/minor parties and preferencing th emajor parties low is dangerous
    unless you have an absolutely sound independent - in which case they'll get up anyway - your vote is likely to go to one of the majors in the preference distribution.

    "None of the above" is the only safe vote.

    It saves you voting for your hated opponents if you are normally rusted on to one of the majors and has people from both sides of politics sending in the same message.
    9th May 2019
    Not sure if this is correct but after age 70 your employer does not have to pay super and there is no work cover.
    9th May 2019
    No a bit out of date ozrog.

    Since 1 July 2013, eligible employees who are 70 years or older have had Superannuation Guarantee contributions paid to super funds, by employers. The previous rules stopped SG entitlements when an employee turned 70 years of age.

    But you are correct about work cover.
    9th May 2019
    I was fortunate enough (and worked hard) to be able to retire at 60 financially. As I am fit and healthy, I believe the 60-70 age decade is when I can put back into the community. I have never been so busy. There are many opportunities to keep your mind and body going in retirement. I cannot understand why I will be likelier to die earlier just because I am retired. Those who are bored in retirement must be boring people
    9th May 2019
    I agree. Now is also the time to do all the things you never had time for. I actually felt sorry for the writers mother sewing from home. How can her job really be social and she would have tight deadlines to meet.
    9th May 2019
    I chose my time to ‘retire’ from full time teaching at 62 & my wife as well & we have not once regretted our decision. Our weekly diary is now so unpredictable & hectic (our choice now) makes life that much fulfilling (teaching was too). We still do some casual supply work when it suits. Yes, social contact, family commitments (babysitting), physical exercise & activities to promote cognitive functioning are vitally important. We made two jobs for others as a bonus. BTW. We, like countless other retirees are not a drain on the pension system & even if we were so what. We worked & paid our taxes over the decades.
    9th May 2019
    "the biggest fear for retirees is outliving their money"

    That can't apply to many people surely - only those with a huge pension pot from which they finance a lavish (tax free short of a salami slice that ScoMo (as treasurer) took when he took the entire part-pensions of most modest retirees away - and not a squeak from pseudo-Labor Shorten) existence.

    For most people their pension pot, once you get into the clawback range, only substitutes for the governemnt age pension - so once it's gone you join the people who for all that time have been doing just as well as you, only at the government's (ie your) expense.

    Waste of time working and saving in the first place.

    In fact I struggle with the notion of "retirement age" - since in the future most working people will get zilch - so retire whenever you can see your way through to age pension age.

    The only exception being for those who can see their way to the >$1m sweetspot.

    OTOH get ready for the future - once the money is behind the super wall it's not really yours. In the future they will *force* people to buy a lifetime annuity - ie that will replace the govt age pension.

    It's theoretically your money but they tell you what to do with it.

    Obviously for now you can draw down what you want and splurge. That tends not to happen because the sort of people who work and save just don't like to do that sort of thing.

    Welcome to the land of the fair go.
    9th May 2019
    Retire when you can and hopefully when you want . You are a long time dead ! Life is short so enjoy it .
    10th May 2019
    Money? more super ? bigger pension? I have no idea, what if you are purely just stuffed physically , thats what happened to me, not compo or anything like that I got out because my job was heavy as anything that anyone has to do, and there would be hundreds and thousands of older workers who are done in! There are or were a few very physical jobs around, people I doubt these days would even know that.
    Instead of the question about delaying retirement why not make retirement a better option for everyone, it still should be 65 for all workers but not compulsory if they want to keep working, but for people who get into their 60's and have had it, there is nothing to do but go, and don't believe the "there are lots of jobs that are different" rubbish. So I went a little earlier than 65 not to go ranging around the world . But because my job had become so heavy and hard to keep up with and my body told me, I am not a compo typed person never have and never will claim that.
    I have a part pension and another pension from work but far far from wealthy. Never left these shores.
    So sometimes people can't wait longer, AND THEY SHOULD NEVER HAVE TO NOR EVER HAVE MONEY PROBLEMS AFTER A LIFETIME OF WORK. You do lose some contact with people but you can rectify that. when you wake up! Positive is the go!
    10th May 2019
    The other side of the coin is that there are many social benefits with retiring earlier. Not only are retirees able to volunteer, travel and do all those bucket list items, but by leaving the paid workforce they open up opportunities for younger workers. This is important to a workforce that is under pressure from increasing automation, imports and loss of unskilled and entry level jobs. We already see high youth unemployment and more long term unemployed in the 45+ age group.
    10th May 2019
    The other side of the coin is that there are many social benefits with retiring earlier. Not only are retirees able to volunteer, travel and do all those bucket list items, but by leaving the paid workforce they open up opportunities for younger workers. This is important to a workforce that is under pressure from increasing automation, imports and loss of unskilled and entry level jobs. We already see high youth unemployment and more long term unemployed in the 45+ age group.

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