If You’re Delaying Retirement for 5 More Years, Do These Things Until Then

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Retirement at 65 used to be the norm. You worked 40-plus years, sometimes for the same company and retired with a pension or Social Security benefits and a paid-off house. But times are changing, and some people are delaying retirement past 65 — sometimes, way past.

There are lots of reasons to put off retiring. Medical advances mean that people are staying healthier longer, and you may not feel ready to leave the working world at 65. Recent changes in Social Security rules mean that you can’t take your full retirement amount until 67 if you were born in 1960 or later. And some people may just not feel confident that they have saved enough, or that the social safety net will be there, to retire.

If you are planning to delay your retirement for five years or so, here are three things you can do in the meantime to set yourself up to leave work.

Take Advantage of Catch-Up Contributions

If you are over 50, you can contribute more to tax-advantaged retirement plans than your younger coworkers. Here’s what the IRS said you can put away.

If you have a 401(k) plan, you can contribute up to $23,500 for 2025, regardless of your age. If you are over age 50, you can contribute an additional $7,500 as a catch-up contribution, for a total contribution of $31,000. However, if you are 60, 61, 62, or 63 in 2025, your catch-up contribution limit is $11,250, which means you can contribute a total of $34,750.

If you are contributing to an IRA, you can contribute up to $7,000 at any age in 2025. If you are over 50, you can contribute an extra $1,000 as a catch-up contribution.

If retirement is in your sights, it makes sense to contribute the most you possibly can during your last five years of working.

Practice Living on Your Retirement Income

A good exercise to undertake if you’re approaching retirement is to figure out what your income is likely to be, and then “practice” living within that amount.

First, determine how much your Social Security benefit will be. You can find this out on the Social Security website, under “Get a Benefits Estimate.” If you have a pension, get an estimate for that too — your human resources department should be able to help with this.

If you plan to work part-time during your retirement, estimate how much you’ll earn from that and add that in, too. Then, determine how much you are comfortable withdrawing from your retirement savings on a monthly or annual basis.

Add this all up to get the amount of money you will have to spend in retirement. Now, adjust your current budget so you’re spending that amount.

This exercise accomplishes two things: It gives you a rough idea of how much money you’ll need in retirement and what your lifestyle might look like; and it may help you to save more in those last few years before you stop working. It can also help you decide if you are ready to retire or not.

Get Ready To File for Social Security Benefits

Once you decide it’s time to retire, you’ll want those benefits to start right away. That’s why now is a good time to get the documents you’ll need to file and keep them handy.

Here’s what you’ll need to file for your Social Security retirement benefit:

• If you were born outside the United States or its territories, you’ll need the name of your birth country at the time you were born, and your Permanent Resident Card if you’re not a citizen.
• If you are or were married, you’ll need the name of your current spouse, and any prior spouse if the marriage lasted more than 10 years or you were widowed. You’ll need your spouse’s date of birth and, if possible, their Social Security number. You’ll need the beginning and ending dates and the locations of your marriage(s).
• If you have children who are disabled or are under 19, you’ll need their names and dates of birth.
• If you are a veteran, you’ll need the dates of your service, type of duty and branch.
• You’ll need the name of your employer for the current and past two years, and the dates your employment started and ended. If you’re self-employed, you’ll need your business type and total net income for that same period of time.
• You’ll need your bank account and bank routing number for direct deposit.

The easiest and fastest way to file is online. To do this, you’ll need to create a Social Security account on the Social Security Administration website. You can do this at any time, and it’s a good way to check what your benefit will be and to be sure your earnings are recorded correctly.

By preparing now for your future retirement, you’ll be able to make a smooth transition from your work life to your next chapter — whatever that looks like for you.

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