Should the (US) retirement age be raised?

Great Debates
1

I considered putting this in General Questions, but I figure it will end up as somewhat of a debate so here it is.

First, my own background. I’ll turn 65 next week, but for my age group, “full” retirement age has advanced to 66. However, since I never made a lot of money and didn’t make the sacrifices necessary, I’m planning/hoping to work until I’m at least 70.

And that’s what has prompted my question – how much real difference would it make if the retirement age was raised to 70? The way it works now, individuals can begin collecting Social Security as early as age 62, although at a reduced amount. When I receive my annual statement, it says that my “full” retirement age is 66. But if I defer my benefits, the monthly amount continues to increase until I reach the age of 70, at which point I will be entitled to a maximum benefit. Why is 66 designated as the “full” retirement age if the amount continues to increase?

I’m guessing that many people in my position will make the same choice I’m making, if they’re able to do so. I’m also guessing that people who managed to accumulate pensions, annuities, investments, or other savings will make different choices, depending on how much they’ve accumulated. Some of them will retire in their fifties, although they may not begin drawing Social Security until sometime in their sixties.

What I’m trying to say, although not succeeding very well, is that it seems to me that the age at which people choose (or are forced) to retire varies for many reasons, of which Social Security is only a part. Do those in favor of raising the age envision doing away with the early-out (reduced benefit) option? Or will the early option be moved higher as well? I realize that until legislation is drafted, there’s no real structure to analyze, but again, I’d be curious to know what kind of projections are out there for potential savings.

I’m leaving this pretty wide open since I don’t really have a strong opinion. I’d be interested in hearing opinions and projections from all sides.

2

Aside from moving the full age from 67 to 70 the agenda being pushed by Boehner involved raising the minimum from 62 to 65. So it is both the minimum age and the full retirement age going up.

Should it be raised? No. The tax cap should be raised. If that doesn’t raise enough funds, then look into mild raises on the age, regressive tax hikes and benefit cuts.

But I have read raising the rate from 12.4% to about 14.2% would keep SS solvent until 2080. That is w/o benefit cuts, lifting the cap or age increases.

http://www.factcheck.org/article302.html

Obama was pushing a window esqe plan where income from 100-250k wasn’t taxed, then it was taxed at 4% to fund SS. Something like that could work.

3

Who is going to hire 20 million old geezers ?

Where are jobs for all these old people who have been laid off, and most of which have numerous health problems?

(note: be specific, name specific job openings for all 20 million currently available job openings, real company names and their addresses )

4

We can’t possibly be that specific, Susanann, until you name all 20 million people, real names and their addresses. How can we find jobs for them if we don’t know who they are or where they live?

Meanwhile, back in the real world, a proposal to raise the retirement age does not mean cancelling the pensions of all those currently under 70, and compelling them all to work, regardless of their state of health. It means adjusting the future entitlements of those currently of working age, so that the terms on which they become entitled to a social security pension reflect an expectation that, in the future, people will normally work to, e.g., age 70. Many countries have done something like this without needing to embark on the exercise that Susanann suggests.

5

Originally Posted by Susanann View Post
Who is going to hire 20 million old geezers ?
Where are jobs for all these old people who have been laid off, and most of which have numerous health problems?
(note: be specific, name specific job openings for all 20 million currently available job openings, real company names and their addresses )

  1. You are being nonsensical, or trying to be funny. It is a well known fact that there are millions of people in America who are aged 62 - 70 years old. The age bracket of age 60 - 70 is the fastest growing segment of our population. They will all need jobs if you raise the retirement age, and so far, you have not come up with even a “1” single million currently available job openings for elderly people.
  2. You are in a different world that we are. The world we are in does not have 10 million available jobs for elderly people, most of whom are sick and have medical problems. There is no employer in America who wants to hire millions of old geezers.

The proposal of raising the retirement age in America to 70 at a time when there are even some healthy young people out there who may be having a little difficulty finding good paying fulltime work with health benefits, would be laughable if it werent so silly.

6

From my upper 50s vantage point, thanks to current 401k fund values, I’m no longer envisioning retirement. Just hoping Wal-Mart needs to hire millions of greeters…

7

Cite?

No. It means many currently working just postpone retirement.

Cite?

Well, there are quite a few employers out there right now that have off-shored jobs so that there is nothing available for many people. And there are many employers with jobs available right now that will only hire people currently working, and will not hire the unemployed, regardless of their age, their health and their skills.

8

Yes, raise it, and I am not all that far away. But not to 70, all at once. I think I need to be 67 for full? Then make it 68 for me, 69 for the gen behind me, 70 for the gen behind them, etc. As UDS and other sez, no one is suggesting cutting benefits for those already retired, just raising it a bit. Let’s face it, today 65 isn’t that old, medical technology and lifestyle changes are allowing us to live longer and live healthier lives.

The cap should also be going up, 10K a year.

9

I was 58 years old last time I was laid off. Being 58 and looking for a job was hard. I was even asked 3 times “just how old are you”. I ended up having to take a job in SF, over an hour commute one way. I hope I can retire at 66, I am now 63. The building where I work could be sold anyday which will put my job at question. If I lose this job I do not know if I will be able to land another in my profession. Right now I have 3 years in question. Increase the age to 70 and there would be 8 years. Also if I work 8 more years then it will keep some young kid from getting my job.

Part of the idea of SS was to open positions for younger workers by getting the old timers out of the job market.

10

It already is 67 for those born after 1960.

I think the biggest qualms I have is that people in their 50s who are unemployed are not going to be able to jump back into the job market with ease. If the minimum age goes up to 65, what is a 59 year old who finds himself laid off supposed to do the next 6 years? Employers discriminate against the elderly all the time. So unless our society creates an extra 50 million jobs to employ all the eldery (and the young people who would otherwise take their jobs) this isn’t going to work. There aren’t enough jobs to go around to deal with the unemployed elderly and unemployed youth.

Plus 65 can be old depending on the vocation. I know several people in their late 50s/early 60s who are pretty much disabled. They couldn’t work any kind of manual labor jobs. Maybe office jobs, but nothing involving a lot of movement and activity.

Not only that, but social security is only taxed on the first 106k in income. Just raise the cap and slightly raise the tax to 13% or so. That’ll keep it solvent until the 22nd century.

I think the cap is on the bottom 90 (or 95%, can’t remember) of income brackets. So if 95% of people earn 106k or less, that is the cap. So it goes up each year, just not fast enough. Medicare used to have a cap like SS where only the first 95% of wages were taxed, but Bill Clinton abolished it in 1993 and probably saved medicare from bankruptcy because of it.

Another potential solution is reducing income inequality. If you are going to only tax the first 100k or so, having all the income growth go to people making well over 100k is going to bankrupt a regressive tax like SS.

SS taxes are 6x higher than they were several decades ago. They used to be about 2% of wages, now they are 12.4%. Despite that life span at 60 is only about 30% longer. People are living a bit longer, but we are paying far more in SS taxes too. It isn’t like people today are getting a free ride on SS.

11

Raising the social security retirement age - in so far as it keeps people in the workforce, of course - will increase the total size, and therefore the total productive capacity, of the US workforce. This will increase competition for jobs, but the supply of jobs is not fixed; the availability of more workers makes it easier for employers to hire or retain, and of course if we are talking about older workers they will be more skilled and experienced, and so in many ways attractive to hire and (especially) to retain. Thus total employment should rise, though not necessarily by the same amount as the total workforce rises.

But there is another side to this that has to be taken into account. Retired workers have to be supported by active workers, whether through social security, through funded pensions, or through other mechanisms. Every older person who remains in work is not just one more worker, but also one less dependent, so decreasing claims on the work output of active workers, and leaving a greater share of what they produce available to them. Hence even if increasing the workforce does create downward pressure on wages, that is at least partly offset by an improved dependency ratio.

12

Then they should get disability benefits. That doesn’t imply that healthy people should get pension benefits at the same time, surely?

13

I’m 43 and I’m expecting to work until 70 or even later.

14

Most old people do not have numerous health problems. Old people are simply more likely to have health problems in general. However, plenty of people are perfectly healthy at 65, and many of those people would be more productive than a given unemployed 20-something.

Your nonsensical demand for someone to name 20 million job openings aside, the number of available jobs is not fixed.

More people in the workforce means more jobs will exist. Old people who continue to commute to work 5 days a week require more infrastructure than those who play golf 5 days a week, for example.

15

Under what supply/demand law is that reasoning found?

Commuting to a job requires different infrastructure than commuting to a golf course?

Plus, the % of jobs directly related to infrastructure is actually only a small part of the total workforce, or at least the non-government funded one.

16

Originally Posted by Susanann View Post
Who is going to hire 20 million old geezers ?
Where are jobs for all these old people who have been laid off, and most of which have numerous health problems?
(note: be specific, name specific job openings for all 20 million currently available job openings, real company names and their addresses )

You continue to avoid the question.

**WHERE ARE ALL THE JOBS??? ???
**
What employer currently has millions of job openings and who also wants to hire old people in their sixties?

17

Good luck with that!!!

WHO??? do you think is going to want to hire YOU when YOU are 69?

Why do you think that YOU will not have health problems in your old age(assuming you would even still be alive at age 69)?

Maybe you could give some tips to other people on how to get a good paying job when a person is in their 60’s and are applying for employment?

As an employer, tell me why would I want to hire an old person in their 60’s, when I can have my pick of thousands of young healthy people who are able to really work hard and are able to give me extra overtime and able to perform with quick reactions, agility, provide me with a worker who has a keen sharp mind, and who would not cause my company-provided dental and health insurance premiums to increase?

18

Why are you assuming that the “old person in their 60’s”:rolleyes: are re-entering the workplace, as opposed to simply continuing their job?

You’d pick the older person as they have more experience, and are more stable. It’s less likely they will be job shopping, surfing the internet or texting while working.

As for “quick reactions, agility”, not many jobs call for those anymore. Keen sharp mind? You really think that dudes in their 60’s are usually senile already? :dubious:

19

It depends on the job. A person doing a desk job who is 65 most likely can still do it at 70, but if you’re doing manual labor or factory work or assembly line work it gets harder and harder each year.

So it’s difficult to say

20

Yes, it should be raised. Since the inception of Social Security the % of Americans who live past the age of 65 has increased by 34.1% for men (from 53.9% to 72.3% (%'s are of all men who lived to the age of 21)) and 38% for women (from 60.6% to 83.6% (%'s are of all women who lived to the age of 21)), while at the same time the life expectancy of Americans who reach the age of 65 has increased by 20.4% for men (from 12.7 years to 15.3 years) and 33% for women (from 14.7 years to 19.6 years), while the “full retirement age” has only increased by 3%, from 65 to 67.

http://www.ssa.gov/history/lifeexpect.html

The solvency of SS wouldn’t even be in question if the retirement age was continually adjusted to the original 1935 life expectancy norms.