A model for examining the two basic approaches of encouraging later retirement is presented in which the coercive approach relies primarily on negative incentives such as benefit reductions, and the voluntary approach encourages continued employment through positive incentives and increased employment opportunities. The degree to which these approaches maximize four policy objectives is assessed in terms of: (1) providing work incentives for older workers; (2) offering adequate incomes; (3) maintaining equitable treatment; and (4) meeting financial commitments of the social security system. Costs and benefits of these approaches to healthy and unhealthy older workers, women, and minorities are identified. The paper concludes that, in the absence of improvements in employment opportunities for older workers, voluntary approaches provide the only equitable means of encouraging later retirement. (JAC)