How long should I continue working before retirement?

  • Make sure you can afford it: Don’t stop working until you prove you can afford to – as long as you are healthy.
  • Work until full retirement age: Aim to work at least until your full retirement age (66-67). This produces many benefits, including:
    • Larger monthly Social Security payment: By delaying taking Social Security, you will receive a larger monthly payment, and all Social Security retirement benefits are adjusted for inflation.
    • Increased savings: You will keep adding to your retirement nest egg instead of depleting it too quickly.
    • Health care: You will keep your employee health care and other benefits longer.
  • Plan ahead: Assume you must spend less once you retire. Some costs will be higher and your disposable income may decrease due to inflation.
  • Phased retirement: If you are considering phased retirement, know what impact scaling back will have on your retirement income, retirement benefits, health care coverage, job security and other life situations.
  • Work part time: Consider part-time work as a good way to supplement your retirement income.
  • Be cautious of buy-outs: View buy-outs with caution and evaluate lump sums carefully: A lump-sum payment may be attractive, but ongoing payments could have more advantages in the long run. Income taxes are spread out over time and payments provide an ongoing "paycheck."