The benefits of delaying your retirement

Written on the 14 September 2021 by Parkside InvestorPlus

The commonly held notion of retiring at age 65 or thereabouts, is slowly but surely changing.

While the thought of having more time to yourself, or enjoying overseas trips, spending endless days on the golf course (not for me by the way) or seeing your grandkids more often may sound very enticing, the thought of retirement at the notional age of 65 for many Australians may not be what it’s cracked up to be or even worse, just not possible because they don’t have enough in their super tank.

Our changing economic circumstances and the resultant pandemic have made the possibility of delaying retirement more relevant and may be even more beneficial.

Before we look at the benefits of delaying your retirement, we need to understand some of the circumstances that have made it even possible to delay your retirement.

Firstly, there has been a measurable shift towards service-based jobs in the marketplace, which means less reliance on the more physically demanding jobs.  The obvious outcome of this shift means people can keep on working longer in roles such as consulting, freelancing, bookkeeping, accounting, and the like.

There has also been a shift over the last decade or so regarding how older workers are perceived in the labour force.  This primary shift has been from ‘you are past your prime’, to the importance of retaining knowledge, expertise and even providing mentorship to the younger workforce.

Thanks to a range of policy measures, more women have been given the opportunity to continue their engagement with the labour force through paid paternity leave (for both men & women), affordable childcare and a strong focus on gender equality.

And finally, an increased acceptance by businesses to openly accept part-time work assignments by older workers, which in large has been beneficial for businesses.

So, given this backdrop that has made delaying retirement possible, what then are the benefits of delaying your retirement.

The benefits of delaying your retirement

Save more (wealth accumulation)

When you retire, you stop investing for the future and start tapping into your retirement savings.

Staying in the workforce longer allows you to continue investing in your longer-term future.

And remember, as you continue to age, you will eventually need the services of aged care, and this will come at a cost.

Test drive your retirement

While still participating in the labour force albeit in part-time mode, you get the best of both worlds, you are still working and earning, and you can trial your retirement lifestyle.

Mental health benefits

Working and engaging with others provides structure to your day and social connections.

Many retirees struggle to find that same purpose after leaving the workforce.

That can cause depression and other health problems.

Delaying your retirement can help to promote physical and mental benefits and ultimately help with life longevity through a healthy mind/body state.

At Parkside InvestoPlus, we look at your retirement planning holistically to ensure you enjoy your retirement with peace of mind and knowing that you will be looked after in those later years.