The huge generation of Americans born between 1946 and 1964, called baby boomers, drove economic expansion in their youth. As they age, they are retiring in large numbers and opening up jobs for younger workers. (see Ref. 1) At the same time, the average retirement age in America has climbed to 62, according to a 2014 Gallup poll. This is the oldest average age since Gallup first asked the question in 1991. (see Ref. 2)
The retirement age has been trending upward since 2002, according to Gallup. It was 59 from 2002 to 2004 and climbed to 60 from 2005 through 2009. It then dipped to 59 in 2010 before continuing its upward climb. The average retirement age finally reached 62 in 2014. (see Ref. 2) Americans are working longer on average because they don't have enough money saved to retire and suffered losses from the Great Recession, Gallup reports. (see Ref. 2)
Many people don't stay in the workforce as long as they had planned. On average, working Americans expect to retire at age 66, four years later than the average age of retirement, according to Gallup. The expected retirement age has also gradually climbed over the years, starting at 63 in 2002 and peaking at 67 in 2012 before settling at 66 for 2013 and 2014. (see Ref. 2) Health problems, disabilities and layoffs are the main reasons people take retirement earlier than planned, according to U.S News. Some people retire earlier because they can afford it, but that's not typical. (see Ref. 7)
Average Life Expectancy
Retirees can also expect to live longer than in the past. According to the Social Security Administration, a male turning 65 in 2015 has a life expectancy of 84.3 years, while a female has an average life expectancy of 86.6. The average life expectancy for the entire population, male and female, is more than 85 years. (see Ref. 5; add both figures and divide by 2) You own lifespan may differ from the average, but the Census Bureau expects average life expectancy to continue to increase. (see Ref. 3 p. 4)
Length of Retirement
If you retire at age 65 and live until 85, you'll spend 20 years in retirement. In fact, that's the average length of retirement, according to the U.S. Department of Labor. (see Resource 4) The U.S. Census Bureau counted 1.9 million people age 90 and up in 2010. (see Ref. 4) Those who retire at 65 and live to 90 or older will spend at least 25 years in retirement, typically while collecting Social Security benefits. According to the Social Security Administration, 90 percent of Americans 65 or older are receiving benefits. (see Ref. 6).