When politicians discuss changing the retirement age, many seniors feel worried. Changes in retirement laws can affect how much Social Security benefits seniors receive.
Since many people depend on these benefits for their daily needs, it’s important to know what changes might happen. Recently, there has been talk about raising the retirement age in the United States.
Conservatives Propose Raising Retirement Age to 70
Some conservative groups believe that the retirement age should be raised to 70. Rachel Greszler, a senior research fellow at the Heritage Foundation, suggested this idea to help solve funding problems with Social Security.
According to the Social Security Administration’s 2023 Trustees Report, Congress needs to act soon to prevent Social Security funds from running out by 2035.
The Problem with Social Security is Bigger than Retirement Age
Rachel Greszler believes that raising the retirement age is only one part of the solution. She also says that adjustments for inflation are needed.
Raising the retirement age might fix 20 to 30 percent of the program’s issues. Adjusting for inflation could solve another 20 to 25 percent of the problems.
Not Everyone Agrees with Raising the Retirement Age
Not all experts agree with Rachel Greszler’s proposal. Financial analyst Stephen Kates argues that raising the retirement age is a negative way to cut benefits.
People can start receiving Social Security benefits at 62, but the full retirement age is 67 for those born after 1959. If benefits are started early, the monthly income might be about 30% lower.
Potential Impact on Future Retirees
Stephen Kates warns that raising the retirement age will lead to lower benefits and a later start date for future retirees. The Center for Budget and Policy Priorities (CBPP) says that if the retirement age is raised,
benefits will decrease similarly to what is expected in the 2030s if no changes are made. Future retirees should watch for updates on this proposal and consider other sources of income and savings.
Gradually Raising the Retirement Age
Rachel Greszler suggests that the retirement age be increased slowly from 67 to 69 or 70. She proposes raising it by one or two months each year and linking it to life expectancy.
This gradual change could help fix Social Security’s funding problems. Additionally, better health care and less physically demanding jobs mean older Americans can work longer.
Benefits of Older Workers in the Workforce
Keeping older workers employed has several advantages. Their experience and knowledge can guide younger workers. Older employees also have more chances to transition into retirement gradually rather than leaving their jobs suddenly.
Proposed changes to the retirement age are meant to address funding issues for Social Security. While some experts support this idea, others are worried about its impact on benefits. It’s important to stay informed and plan for financial alternatives if you’re a future retiree.
1. What is the current retirement age in the United States?
The full retirement age is 67 for people born after 1959. Benefits can be started as early as age 62, but with a lower monthly amount.
2. Why do some people want to raise the retirement age?
Some believe raising the retirement age will help solve funding problems with Social Security and ensure the program remains stable.
3. How much will benefits decrease if the retirement age is raised?
Benefits might decrease by about 30% if you start receiving them before the full retirement age, and changes in retirement age could affect future benefits similarly.
4. What are the potential benefits of older workers staying in the workforce?
Older workers can share their experience and knowledge with younger employees and have a smoother transition into retirement.
5. What should future retirees do while waiting for changes to be decided?
Future retirees should stay informed about any changes and consider finding other sources of income and saving money to prepare for retirement.
