U.S. research explains why Americans should delay retirement

For Americans with their 60th birthday behind them, a retirement research recently explained why it might be a better choice for them to keep their jobs a bit longer.

The Center for Retirement Research at Boston College, a non- profit research institute based at Chestnut Hill, Massachusetts, said in its report that for Americans, working longer is the key to a secure retirement.

According to the report, changes in the provision of retirement income together with a decline in retiree health insurance played important roles in senior citizens' decisions to put off their retirement.

Before mid-1980s, workers were entitled to a defined benefit pension that provided a fixed income stream. However, thanks to the 401(k) plan, workers are now responsible for their own retirement income through their 401(k) accounts.

Under the 401(k) plan, retirement savings contributions are offered by an employer and are deducted from the employee's paycheck before taxation.

"Studies show that workers covered by 401(k) plans retire a year or two later on average than similarly situated workers covered by a defined benefit plan," the study found.

The decline of retiree health benefits and the rapid rise in health care costs should also be considered when making the decision to retire, the report suggested.

"Given that the earlier factors contributing to later retirement appear to have run their course, the most potent level at this point may be educating workers about the enormous payoff to working longer and delaying claiming retirement benefits," said Alicia Munnell, director of the center, in a interview with the TV network NBC News. Endite