Waiting for Social Security

The age at which Americans become eligible for full Social Security benefits has climbed to 66, but many still choose to retire at 65. Why do so many older Americans jump the gun, reducing their retirement income? That's the question posed by researchers at the Center for Retirement Research at Boston College, and their analysis shows why: Medicare eligibility.

Because people become eligible for Medicare at age 65, many choose to retire then rather than wait for full retirement age at 66. Interestingly, workers without access to retiree health benefits through their employer are much more likely to take their job and shove it as soon as they become eligible for Medicare. Those with access to retiree health benefits through their employer are more likely to wait the additional year before collecting Social Security. "The result fits into extensive research showing that access to health insurance is an important component of the retirement decision," the researchers conclude. So too is job quality. Workers with access to retiree health benefits through their employer are likely to have better jobs, which makes it easier to wait for full retirement age.

Source: Center for Retirement Research at Boston College, Sticky Ages: Why is Age 65 Still a Retirement Peak?