Ever think about how long you’ll have to work before you can finally retire and enjoy your golden years? If you’re like most Americans, you probably think you’ll work until 65 or even 70. But the truth might surprise you!
As someone who’s spent years researching retirement trends (and worrying about my own retirement timeline) I’ve discovered some fascinating insights about the actual working life of the average American. Let’s dive into the truth about how long most people work before retirement and what that means for your own retirement planning.
The Reality vs. Expectations Gap
Here’s the surprising truth: the typical American retires at age 62 – not 65, 70, or 80 as many might expect. This information comes from annual surveys conducted by both the Transamerica Center for Retirement Studies and the Employee Benefit Research Institute (EBRI).
But here’s the interesting part: most of us don’t really plan to retire that soon. Transamerica’s research shows that workers over 50 can expect to retire at age 67 on average. That makes a big difference of 5 years between when people think they’ll retire and when they actually do.
As Catherine Collinson, CEO of the Transamerica Center, puts it: “Often, it does appear that it’s out of their hands.” Their research shows that 56% of retirees retired earlier than they expected, while only 37% retired on their own schedule, and just 7% retired later than planned.
How Many Working Years Is That?
Let’s break down what this means in terms of actual working years:
- If you start working at 18 (right after high school) and retire at 62: 44 working years
- If you start working at 22 (after college) and retire at 62: 40 working years
Compare this to what some retirement systems seem to expect:
- Social Security maximizes benefits at age 70, suggesting a target work life of 48-52 years
- The average retirement age varies by state, but ranges between 61-67, with most states averaging between 62-65
Why Do People Retire Earlier Than Planned?
The reasons for earlier-than-expected retirement are eye-opening:
- Health issues: Nearly half of early retirees cite physical limitations, disease, or disability
- Job-related factors: About 40% blame unemployment, downsizing, being pushed to retire, or job dissatisfaction
- Economic conditions: Layoffs and difficulty finding new employment as an older worker
Howard Hook, a certified financial planner in Princeton, New Jersey, notes: “You see it now, with a lot of companies laying off people. Are a lot of those people going back to work? Some may; some may not.”
The Retirement Age Around the World
Interestingly, America’s implied target work life of 48 years (based on Social Security’s maximum benefit age) is among the highest in developed nations:
- United States: 48-52 years (depending on education)
- Norway, Poland, Italy, Israel: 44-45 years
- Turkey, Korea, France, Greece: Under 40 years
Planning Realistically for Retirement
So what does all this mean for your retirement planning? Here are some key considerations:
1. Plan for potential early retirement
Since more than half of Americans retire earlier than planned, it’s wise to prepare for the possibility that you might not work as long as you expect. This means:
- Saving more aggressively earlier in your career
- Building an emergency fund that could bridge the gap if you retire before qualifying for full Social Security benefits
- Considering disability insurance to protect against health-related early retirement
2. Understand your Social Security options
- Earliest claiming age: 62 (with reduced benefits)
- Full retirement age: 66-67 (depending on birth year)
- Maximum benefit age: 70
Remember that only about 10% of Social Security recipients claim at the maximum benefit age of 70, and those who do tend to be higher-income individuals.
3. Consider healthcare coverage
Medicare doesn’t kick in until age 65, creating a potential coverage gap if you retire at the average age of 62. Options to bridge this gap include:
- COBRA (though potentially expensive)
- ACA marketplace plans
- Spouse’s insurance
- Employer-provided retiree health benefits (increasingly rare)
How Much Do You Need to Save?
The amount needed for retirement depends on various factors including:
- Your desired lifestyle
- Expected retirement length (now averaging 18.6 years for men and 21.3 years for women)
- Healthcare costs
- Location
- Other income sources (Social Security, pensions, etc.)
Most financial experts suggest aiming to replace about 70-80% of your pre-retirement income. According to a recent survey, most Americans believe they need around $1.8 million to retire comfortably.
Special Retirement Situations
Some careers offer earlier retirement options:
- Military service: Typically eligible for pension after 20 years of service
- Police and firefighters: Often can retire after 20-25 years
- Unionized workers: Some unions like United Mine Workers and United Auto Workers offer “thirty and out” pension programs
The Changing Landscape of Retirement
The concept of retirement continues to evolve due to:
- Increased life expectancy: People are living longer, requiring more retirement savings
- Shifting economic conditions: Economic fluctuations impact savings and investment returns
- Changing social norms: Retirement ages and career paths are becoming more flexible
Bottom Line: Be Prepared for the Unexpected
We can’t always retire when we want to, which is a harsh truth. “Radical departure” from what employees expect is what Transamerica calls retirement in the United States.
Many workers envision gradually leaving their jobs on their own schedules. However, actual retirement usually comes suddenly and unexpectedly, triggered by health issues or business decisions beyond our control.
So while Social Security might be designed with the expectation of a 40-52 year working career, the reality for many Americans is quite different. By understanding this gap between expectations and reality, you can better prepare for whatever retirement timeline life has in store for you.
What’s Your Retirement Plan?
I’d love to hear from you! How many years do you expect to work before retirement? Have you factored in the possibility of retiring earlier than planned? Share your thoughts in the comments below!
Remember, retirement planning isn’t one-size-fits-all. Your personal circumstances, career path, and retirement goals should shape your strategy. Consider consulting with a financial advisor who can help tailor a plan to your specific needs and help you navigate the often unpredictable journey to retirement.
Working with an advisor can be particularly valuable in developing contingency plans for early retirement scenarios and ensuring you’re financially prepared regardless of when your working years come to an end.
Social Security and Work: How Much Can You Make in 2025?
FAQ
How long do people usually work before retiring?
If you spend four years in college before starting your career at 22, you’ll work for 40 years before you can claim your Social Security benefits. The average age of retirement, however, is about 64. If you start working at age 18, you’ll have a 46-year career, and if you graduate from college, you’ll have a 42-year career.
Can you retire after 20 years of work?
Yes, you can retire after 20 years of work, but eligibility and the amount of your benefits depend on your age, your retirement plan (e. g. , federal, private sector), your Social Security credits, and how much you’ve saved. For federal employees, 20 years of service allows for immediate, unreduced retirement if you are at least 60 years old, but for early retirement, the benefit may be reduced.
Can I retire at 62 with $400,000 in 401k?
Can You Retire at 62 With $400,000 in a 401(k)? It’s certainly possible to retire early on $400,000, but it won’t be easy. If you have the option of working and saving for a few more years, it will likely give you a significantly more comfortable retirement.
Do people who work past 65 live longer?
In one, researchers looked at 2,956 Americans 50 and older over 18 years and compared those still working with those who had retired. They found that those who postponed retirement one year, from age 65 to 66, saw the risk of death drop 9 to 11 percent over 18 years.
How long do you have to work to retire?
The number of years you have to work to retire depends on, among other things, when you start working. And not to mention how much you earn and your current age. You could work for 52 years if you start working in the private sector at age 18 and wait until age 70 to get the most out of Social Security.
How long does it take to retire from Social Security?
SS seems to be based on the idea that people will work for between 40 and 52 years. But many Americans don’t actually work that many years before retiring. In the early 1990s, the average American retired at age 57. How long does it take for the average person to retire? The average is now 66 years old.
What is the average retirement age?
In 45 states, the average retirement age is between 62 and 65. The average retirement age is 64 for a work life of about 42 years, not anywhere close to 48 or 52 years. And less than 10% of Social Security recipients get the maximum benefit by claiming at 70, and those that do are the highest-income individuals.
When should you retire?
Most Americans now expect to retire at age 65 or later. [See The 10 Best Places to Retire in 2012.] “It’s just not possible for people to work for 30 or 40 years and support themselves on their assets for another 20 or 30 years,” says Alicia Munnell, director of the Center for Retirement Research at Boston College.
When should you stop working and retire?
However, based on these findings, once you reach 55, after 37 years of work, you may well be ready to stop working and retire. The number of years you have to work to retire depends on, among other things, when you start working. And not to mention how much you earn and your current age.