The Top 9 Reasons Americans Spend Their Golden Years Working

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Retired worker
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Americans who used to dream of working until age 65 and getting a gold watch for their efforts are waking up to a new reality: continued employment well into their golden years.

A growing number of older Americans now work, according to U.S. Bureau of Labor Statistics data. BLS data show that the share of Americans ages 65 to 74 who are still in the workforce rose from 23.6% to 26.8% between 2006 and 2016. By 2026, 30.2% of people that age are projected to be working.

So, why are so many workers willing to punch the clock during their golden years? According to the 20th annual Transamerica Retirement Survey of Workers, 78% cite financial reasons. The most common ones include:

  • Wanting the income (cited by 51% of surveyed workers who are working or plan to work in retirement, past age 65 or both)
  • Being unable to afford to retire because haven’t saved enough (31%)
  • Concerned that Social Security will be less than expected (31%)
  • Needing health benefits (26%)

But money isn’t the only factor pushing people to work longer — 78% also want to work during their senior years for what the Transamerica Center for Retirement Studies describes as “healthy-aging reasons.” These include:

  • Wanting to be active (50%)
  • Keeping their brain alert (40%)
  • Enjoying what they do (38%)
  • Having a sense of purpose (34%)
  • Maintaining social connections (23%)

Interestingly, the intention to work beyond the traditional retirement age — defined here as 65 — cuts across age cohorts. Overall, 57% of workers of all ages plan to work full time or part time after they retire.

Among millennials and members of Generation X — the two generations born after the 1946-64 baby boomers — 19% say they plan to work full time into their “retirement” years. That’s higher than the 12% of baby boomers who plan to work full time.

In addition, the reasons why people say they plan to work during their golden years vary by age.

Baby boomers are especially likely to cite wanting more income as their prime motivator compared with other generations. Members of Generation X are slightly more likely to cite a lack of savings, while millennials are significantly more likely to point to a desire for personal development.

How working longer pays off

Continuing to work well past the age when people may once have taken up shuffleboard can have big benefits.

As we have reported, working longer allows you to avoid dipping into — and depleting — your savings. We also note another benefit of having extra income:

“In addition, you’re allowed to tuck more away for your nest egg. People over age 50 have higher annual retirement contribution limits thanks to what the IRS calls ‘catch-up contributions.'”

For more, check out “7 Unexpected Benefits of Delaying Retirement.”

Whatever you do, don’t stop working until you are certain that you have the financial foundation to do so. Asking — and answering — some important questions can help you determine whether you are ready to say “so long” to work.

To begin the process, read through Money Talks News founder Stacy Johnson’s story “Your Top 5 Retirement Questions, Answered.”