What Are The Benefits Of Delaying Retirement? 

Delaying your retirement could be an option if you do not have a solid financial plan for old age.

Outlook Money
October 13, 2023
Retirement Delay

Retirement Delay

While the buzz around ‘Financial Independence, Retire Early (FIRE) gets louder by the day, one thing may be clear: many people might be open to retiring early if their financial circumstances allow. Still, there are some who may want to delay their retirement if they are not prepared yet. So, for them, age is not a compulsion for retirement, which typically happens between 58 and 65, as long as they can carry on with what they have been doing in their respective fields. 


Starting savings early and consistently is the key to creating a strong retirement corpus; however, it is easier said than done. It is because most people, early in their careers, focus on improving their living standards or fulfilling their materialistic pursuits instead of saving for retirement. But by the time they learn about handling money wisely, several years of their work life will already have passed. So, some of those people may want to compensate for the lost years by working after retirement or delaying retirement for a few years to build the required financial corpus. 

Let us see how seniors can benefit from delaying their retirement. 

Financial Benefits: 

Due to better medical services and facilities, people’s life expectancy has increased, and so need a bigger retirement corpus. Say, if one retires at 60 and the life expectancy is 85 years, he has to have enough funds to last his next 25 years. But if one retires at 65, the corpus would be for 20 years, and he will have more money in the fund for five extra years of work. So, by delaying retirement, you get more time to build your corpus. Moreover, at retirement age, they may be at the peak of their earning potential or higher-end income flow, so continuing work for a few more years will enable them to contribute more to their retirement corpus, making a significant difference in financial security for old age.

Moreover, the additional work years would provide more time for the savings and investments to grow, which is a win-win situation.

Delaying retirement can also help in ensuring good health.

Health Benefits:

Retirement is generally linked with age. The study on the impact of post-retirement work on the psychological well-being of the elderly, published in the Indian Journal of Mental Health in 2018, said, “Ageing is not biological but a social and psychological process as well. Reducing physical capacities, changing roles in the family and society, financial dependency of children, and lack of opportunities to use their knowledge and wisdom can bring new challenges to the elderly. A lot of unutilised free time can add to this challenge. Hence, readjustment with family and society and channelising their resources is essential.”

Keeping engaged in some activity even after retirement and utilising time productively is good for psychological and overall health.

Continuing work in their golden years reduces the chances of cognitive issues in seniors as they have a purpose to work for. It keeps them active mentally as well as physically. However, retirement from an organisation is not a full stop to their work life if they want to continue; they may look for ways to stay financially, physically, and mentally strong and independent, which may all be possible by delaying retirement.

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