Winning Physically and Financially: How Working to 70 and Delaying Social Security Stack the Deck in Your Favor

For many Americans, the dream is to retire young with a large enough bank account to live comfortably for the rest of their lives. However, for the majority of us, that's simply not in the cards -- and research shows that may be OK.

No matter how old you are, if you struggle with when you can retire, you may be surprised by the benefits of hanging on until age 70. That doesn't mean you have to stay in your current job. Even if you transition into a position that's less physically or mentally taxing, the benefits are there, especially if working allows you to postpone Social Security.

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Financial power of delaying Social Security

While you can claim Social Security benefits as early as age 62, every year you wait increases your monthly check, up to age 70. After your full retirement age -- 67 if you were born in 1960 or later -- each year you delay earns 8% in delayed retirement credits. For example, if your Social Security benefit at age 67 is expected to be $2,000 per month, it would be $2,480 at age 70.

In addition, continuing to work allows you to save more and avoid tapping your portfolio too early. The longer you can go without making portfolio withdrawals, the more time your money has to potentially grow.

Health benefits of working until 70

Before diving into the health benefits associated with working longer, there is one important caveat. If you're seriously ill and are expected to have a shorter-than-average life, there's no question that retirement -- even early retirement -- may be the best thing you can do for yourself.

However, if you're healthy, repeated research shows that employment later in life can lead to lower mortality, better self-rated health, and stronger preservation of cognitive function. In fact, a CDC study found that people who work past 65 are about three times more likely to report good health, and roughly half as likely to have serious health conditions like heart disease or cancer.

What's more, a study conducted on behalf of the Japan Geriatrics Society found that full-time employment may even reduce the risk of dementia and physical decline in frail older adults.

Many of those benefits may be associated with maintaining a routine and physical activity. However, working longer can help provide continued social interaction and a sense of purpose, two key ingredients for emotional well-being and protection against isolation and depression. Simply staying mentally engaged through communication, problem-solving, and learning new skills can help maintain cognitive ability.

Naturally, if you began planning and investing early and have plenty of money by the time your retirement age rolls around, you've already covered your financial bases. That said, if you're concerned about maintaining your physical, mental, and emotional well-being after full retirement age, you may want to continue working anyway. That, or explore volunteer opportunities, as studies show they offer many of the same benefits.

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