Expect to live a long life? Then you may delay retirement

People who expect to live into their 70s and 80s are likelier than previous generations to delay retirement, according to a new study.

Americans who think they’ll live to at least 75 are more apt to remain in the workforce compared to those in the past with shorter expected lifespans, according to the report by the Center for Retirement Research at Boston College.

There is “a statistically significant relationship between an individual’s subjective life expectancy and his expectations of when he’ll retire,” according to the study. “As individuals become more optimistic about living to ages 75 or 85 … they push out their planned retirement dates and increase their expectations about working” longer in life.

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The willingness to delay retirement is sparked by two forces – people’s expected need for money in later years and the belief that they’ll be healthy enough to remain in the workforce.

The study indicates that Americans are slowly coming to terms with the financial realities associated with increased longevity.

In 2012, the average 65-year-old man was expected to live to nearly 84, the study said. In 1980, by contrast, the average lifespan was just shy of 80.

“A longer life requires greater wealth to finance consumption,” according to the analysis. And “greater longevity is likely associated with better health during one’s working years, making continued work more feasible.”

The willingness to collect a paycheck as long as possible is encouraging given the chronic shortcomings in Americans’ retirement planning.

But that doesn’t mean people will necessarily be able to work longer. Untimely health issues or layoffs frequently shorten Americans’ working lives.

In other words, it’s still prudent to save wisely early in life because there’s no guarantee of a paycheck down the line.

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