(Bloomberg View) – You're 49 years old, you make $113,000 a year and you're starting to get worried about financing your retirement.
You could take the drastic step of upping your retirement savings by 10 percent of your salary.
Or you could achieve the same result by retiring two years and five months later than you had been planning to.
This is one of a number of such comparisons in a remarkable new National Bureau of Economic Research working paper, "The Power of Working Longer," that I imagine is going to become a staple of retirement advice in the coming years.
The authors are Gila Bronshtein, Jason Scott, John B. Shoven and Sita N. Slavov. Shoven is a Stanford economics professor and longtime retirement guru who, at age 70, is practicing what he preaches. Bronshtein, Scott and Slavov all got their doctorates in economics from Stanford in the past 15 years and are now working at, respectively, Cornerstone Research, Financial Engines and George Mason University.
The authors look at scenarios for different incomes, living arrangements and rates of return. But the findings all point in the same general direction:
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