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(c) 2016 Jon L Gelman, All Rights Reserved.

Thursday, March 20, 2014

Delay Retiring: A ‘Smart’ Decision

Today's post was shared by CRR Boston College and comes from squaredawayblog.bc.edu

If postponing retirement can improve one’s financial security in old age, why do so many people rush to retire when they reach age 62?

Much research has explored the financial and health reasons that explain why so few people choose to retire later. Taking a different tack, a new study found that individuals with higher cognition foresee a higher probability of working longer.

There were two steps to this research.

First, participants in an Internet survey were asked if they planned to continue working full-time after age 62 and, separately, if they expected to work past 65. Participants were between the ages of 45 and 61.

Next, the researchers measured each survey participant’s “crystallized intelligence,” which is the wisdom acquired with age. This type of intelligence helps to compensate for declining “fluid intelligence” – the ability to think quickly – which peaks in young adulthood. To measure their crystallized intelligence, participants took a standard psychology test in which they are shown pictures – perhaps a goat, maracas, a sextant (an astronomical instrument) – and asked to name them.

It’s an “adaptive” test that is able to measure the gamut of cognitive abilities. If an individual labels the first set of pictures accurately, then the second set of pictures he is given is more difficult to identify.

Those who scored higher on this test were...

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