Should You Delay Retirement for a Bigger Nest Egg?

8 May 2025

Retirement – the golden years of relaxation, travel, and finally doing what you love. But how do you ensure you have enough money to truly enjoy them? Many people are faced with the tough decision of whether to retire at the traditional age or work a little longer to build up a bigger nest egg.

Is it worth postponing your well-earned retirement for financial security? Or should you stick to your original retirement plan, even if it means a tighter budget? Let’s break it down.

The Case for Delaying Retirement

1. More Time to Save and Invest

One of the biggest advantages of delaying retirement is the extra time you get to build your savings. If you continue working for a few extra years, that’s additional income that can be saved, invested, or used to pay off remaining debts.

Think of it like filling up a bathtub—if you keep the faucet running a little longer, the water level rises significantly. Similarly, working just 3-5 more years can lead to a drastically larger retirement fund.

2. Higher Social Security Benefits

Did you know that delaying your Social Security benefits past full retirement age can significantly boost your monthly checks? If you wait until age 70, your benefits increase by about 8% per year. That’s a guaranteed return you won’t find in most investments!

For example, if your full retirement age is 67 and you’re eligible for $2,000 per month, delaying until 70 could bump that up to around $2,480. Over time, that extra income really adds up.

3. Fewer Years of Withdrawals

The longer you work, the fewer years you’ll need to rely on your savings. If you retire at 62 and live until 90, that’s 28 years of withdrawals. But if you retire at 70, you only need to fund 20 years. This means your nest egg won’t have to stretch as thin, giving you more financial security.

4. Employer Benefits Stick Around

Many jobs offer health insurance, 401(k) matching, or pension contributions. By working longer, you extend these perks—sometimes saving thousands on healthcare costs alone. Considering how expensive medical bills can get in retirement, keeping employer-sponsored insurance for a few extra years could be a game-changer.

5. A Better Lifestyle in Retirement

Delaying retirement doesn’t just mean more money—it can also mean a better quality of life. With a bigger nest egg, you won’t have to cut corners. You can travel, dine out, and enjoy new experiences without constantly checking your budget.

The Downsides of Delaying Retirement

1. You Might Not Be Able to Work Longer

Let’s face it—working longer sounds good in theory, but life doesn’t always go as planned. Health issues, job layoffs, or even burnout can force an earlier retirement, whether you like it or not.

According to research, nearly half of retirees end up leaving work earlier than expected due to circumstances beyond their control. Banking on working until 70 might not be a safe bet.

2. Less Time to Enjoy Retirement

Retirement should be about enjoying the fruits of your labor. If you work until 70, you’ll have less time to travel, pick up hobbies, or simply relax. After all, what’s the point of having a larger retirement fund if you’re too tired to enjoy it?

Many people regret not retiring earlier, realizing too late that they missed out on valuable years of good health and energy.

3. You Could Sacrifice Your Happiness

Working longer may boost your finances, but is it worth it if you’re miserable? If you love your job, great! But if every day feels like a grind, pushing retirement back could put unnecessary stress on your well-being.

Mental health is just as important as financial health. There’s no sense in working longer if it means sacrificing your happiness.

4. Market Risks Still Exist

Even with a bigger nest egg, there are no guarantees in the stock market. A market downturn could still impact your savings, and delaying retirement doesn’t automatically shield you from financial risks.

Plus, working longer doesn’t always mean higher returns. If your investments aren’t managed wisely, extra savings might not make as big a difference as you expect.

How to Decide What’s Best for You

So, should you delay retirement for a bigger nest egg? The answer isn’t one-size-fits-all. It depends on your personal situation, goals, and priorities. Here are a few questions to ask yourself:

- Do you enjoy your job? If yes, working longer may not be a burden. If not, retirement might be the better option.
- How’s your health? If you’re in good shape and enjoy working, delaying may be fine. If not, retiring earlier could be smarter.
- Do you have enough saved? If your retirement savings feel inadequate, waiting a few more years can give you financial peace of mind.
- What do you want retirement to look like? If your dream retirement involves lots of travel or hobbies, working longer might give you more freedom to enjoy it.

Finding a Balance

For some, a middle ground is the best approach. Instead of working full-time longer, consider a phased retirement.

- Part-time work: This provides income while still allowing more free time.
- Consulting or freelancing: Use your experience to earn money on a more flexible schedule.
- Delaying Social Security but retiring earlier: You can retire at, say, 65 but use savings for a few years before tapping into Social Security benefits at 70.

Retirement doesn’t have to be all or nothing. Finding a way to balance financial stability with personal happiness is key.

The Bottom Line

Delaying retirement for a bigger nest egg has clear benefits, but it’s not the right choice for everyone. It comes down to how much money you need, your health, and how you want to spend your time.

There’s no right or wrong answer—only what feels right for you. The best strategy is to plan wisely, weigh the pros and cons, and make a decision that aligns with your financial goals and lifestyle. After all, retirement should be something to look forward to, not a source of stress.