This is Mary Walden with economist MW, welcoming you to the economic perspective. Today’s program looks at working longer before retiring. Mike, the financial devastation created by the Great Recession for many people motivated older workers to reevaluate their retirement decision. Is there a big financial benefit to workers eligible for retirement working a few more years?
- According to a new analysis by economists at the NBER, the answer is a yes
- Four benefits
- Working more allows more to be contributed to retirement funds
- Working more allows money already in retirement funds to grow more
- If want to convert retirement funds to an annuity that promises annual income as long as live, the annuity will be cheaper to buy the older you are
- Last – working more and waiting to take Social Security increases what you will get from SS – and this is particularly true for lower income workers
- Of course, against all this must weigh psychic benefit of retiring