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What Should The Retirement Age Be For SS?

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JoeTheEconomist

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MarketWatch published three columns on the retirement age for Social Security.

This piece is from Jason Fichtner from Mercantus says that retirement age needs to move to 70. "The harsh reality is that Social Security wasn’t designed to finance 20 to 30 years of retirement."

The retirement age for Social Security needs to rise to 70 - MarketWatch

This piece is from Chris Farrell from MarketPlace which says that retirement age needs to move to 76.

Should the Social Security retirement age be 76? - MarketWatch

I contributed a contrast piece which said that the problem isn't that we are living longer. The problem is that more of us are living average. Up to now, the changes in life expectancy have made the system more solvent not less.

Why the age for Social Security benefits doesn’t need to go up to 70 - MarketWatch
 
There are a number of ways to fix SS.

I favor a mix of the available options. The first is to stop pretending it's something different, it's just another govt program, fold it into the general fund. Second, SS will run massive surpluses in the future. Let it run a debt for a while, the surpluses will take care of it. Third, stop the weaseling by the wealthy.

If you did all of them, we could reduce the cost of SS on young workers, which would also be a smart thing to do.
 
late said:
There are a number of ways to fix SS.

I favor a mix of the available options. The first is to stop pretending it's something different, it's just another govt program, fold it into the general fund. Second, SS will run massive surpluses in the future. Let it run a debt for a while, the surpluses will take care of it. Third, stop the weaseling by the wealthy.

If you did all of them, we could reduce the cost of SS on young workers, which would also be a smart thing to do.
Click to expand...
Please outline the conditions in the future where SS will run massive surpluses?
 
I have slowly talked myself out of the idea that Social Security can be repaired exclusively by moving the Retirement Age around. We are going to have to revisit the program in its entirety to see what can be done for future generations.
 
longview said:
Please outline the conditions in the future where SS will run massive surpluses?
Click to expand...

Elementary, my dear Watson.

SS will be in the near future sending out more than it's taking in. (It won't be out of money; it won't be in the red.) This is because there will be more beneficiaries than the number of contributing workers in the work force. This is a time-generated problem because of the baby boom post-WWII.

As the boomers die off, the next generation will begin to retire. There will be far fewer beneficiaries. There will also be, at the same time, more workers in the work force, because of America's economy and birth rate. The SS fund will begin to build a large reserve, as it takes in much more than it is sending out.

In the meantime, for those who are nervous, a small uptick in payroll taxes (tiny tiny) would have a big effect on the SS reserve.

Time to really put the SS fund in a lockbox. It was taken not long ago to contribute to the Iraq War and pay for tax cuts for the wealthy. The govt is or will be paying it back, but I wonder how much investment return was lost because of that.
 
Viewing the SS problem as folks living too long is the same as saying that they simply work for too few years. If that is the case then why can folks working for the government retire at a much lower age than those relying on SS? Would (should?) we also up the retirement age for government workers and the IRA withdrawl age to that mandated for SS as well?

In a slow growth economy the main way that a "new" job opens is for a current worker to retire or to get promoted. Forcing many more folks to work more years means even fewer job openings for those wishng to get promoted or to get an entry level position.

Raising the SS retirement age has already shown us that more will become disabled thus drawing even higher SS benefits for their remaining years. IMHO, the best solution is not to try limiting benefits, by raising the retirement age, but by increasing the "contribuions" of the payroll tax by raising the employee and employer "contribution" from 6.2% to 7%.
 
JoeTheEconomist said:
MarketWatch published three columns on the retirement age for Social Security.

This piece is from Jason Fichtner from Mercantus says that retirement age needs to move to 70. "The harsh reality is that Social Security wasn’t designed to finance 20 to 30 years of retirement."

The retirement age for Social Security needs to rise to 70 - MarketWatch

This piece is from Chris Farrell from MarketPlace which says that retirement age needs to move to 76.

Should the Social Security retirement age be 76? - MarketWatch

I contributed a contrast piece which said that the problem isn't that we are living longer. The problem is that more of us are living average. Up to now, the changes in life expectancy have made the system more solvent not less.

Why the age for Social Security benefits doesn’t need to go up to 70 - MarketWatch
Click to expand...

If it wasn't designed for that, then restructure it. Few companies want to keep people in their 60s much LESS until 70. Actuaries can fix it. We'll all have to pay more, but that's the breaks. Without a mandatory program to cover people in retirement, we'll be supporting people through welfare programs. You work? You contribute to mandatory retirement benefits.
 
JumpinJack said:
Elementary, my dear Watson.

SS will be in the near future sending out more than it's taking in. (It won't be out of money; it won't be in the red.) This is because there will be more beneficiaries than the number of contributing workers in the work force. This is a time-generated problem because of the baby boom post-WWII.

As the boomers die off, the next generation will begin to retire. There will be far fewer beneficiaries. There will also be, at the same time, more workers in the work force, because of America's economy and birth rate. The SS fund will begin to build a large reserve, as it takes in much more than it is sending out.

In the meantime, for those who are nervous, a small uptick in payroll taxes (tiny tiny) would have a big effect on the SS reserve.

Time to really put the SS fund in a lockbox. It was taken not long ago to contribute to the Iraq War and pay for tax cuts for the wealthy. The govt is or will be paying it back, but I wonder how much investment return was lost because of that.
Click to expand...
There will be fewer and fewer workers for each beneficiary.
I think they can still fix SS, but the changes at this stage would be unpleasant.
I look for them to start means testing income, where say each $2 of outside income above $3000 a month,
reduces the persons SS by $1.
They used to do something this for people on SS, who still worked before age 70.
I could easily see them applying it to all types of earnings.
 
late said:
There are a number of ways to fix SS.

I favor a mix of the available options. The first is to stop pretending it's something different, it's just another govt program, fold it into the general fund. Second, SS will run massive surpluses in the future. Let it run a debt for a while, the surpluses will take care of it. Third, stop the weaseling by the wealthy.

If you did all of them, we could reduce the cost of SS on young workers, which would also be a smart thing to do.
Click to expand...

Walk me through your idea. You want a general fund subsidy to pay Bernie Sanders and his wife $50,000 per year while workers labor under 100,000s in student loan debt? Walk me through the logic of that. Separately, no one projects surpluses in the future of SS - ever.
 
OrphanSlug said:
I have slowly talked myself out of the idea that Social Security can be repaired exclusively by moving the Retirement Age around. We are going to have to revisit the program in its entirety to see what can be done for future generations.
Click to expand...

It does not repair anything. There is no meaningful difference between a benefit cut by legislation and a benefit cut caused by insolvency. All this policy does is explain to me how the program is broken. Now I know how my benefits will be cut rather than face the uncertainty about the shape of the cuts. Oh boy! Thanks.
 
longview said:
There will be fewer and fewer workers for each beneficiary.
I think they can still fix SS, but the changes at this stage would be unpleasant.
I look for them to start means testing income, where say each $2 of outside income above $3000 a month,
reduces the persons SS by $1.
They used to do something this for people on SS, who still worked before age 70.
I could easily see them applying it to all types of earnings.
Click to expand...

So the existing Social Security will not have any surpluses. Your new and improved version of Social Security will have surpluses.
 
JoeTheEconomist said:
So the existing Social Security will not have any surpluses. Your new and improved version of Social Security will have surpluses.
Click to expand...
No, I do not see any surpluses in SS future!
I do not think they have the political will to fix it, and so will apply band-ads,
until it is no longer functional.
I see means testing as simply a likely way they will try to keep the system alive longer.
They will hold up someone like Bill Gates, and ask, does he really need his $2000 a month SS check?
The down side is such means testing is effectively a tax on those of us who are actually preparing for retirement.
 
JumpinJack said:
Elementary, my dear Watson.

SS will be in the near future sending out more than it's taking in. (It won't be out of money; it won't be in the red.) This is because there will be more beneficiaries than the number of contributing workers in the work force. This is a time-generated problem because of the baby boom post-WWII.

As the boomers die off, the next generation will begin to retire. There will be far fewer beneficiaries. There will also be, at the same time, more workers in the work force, because of America's economy and birth rate. The SS fund will begin to build a large reserve, as it takes in much more than it is sending out.

In the meantime, for those who are nervous, a small uptick in payroll taxes (tiny tiny) would have a big effect on the SS reserve.

Time to really put the SS fund in a lockbox. It was taken not long ago to contribute to the Iraq War and pay for tax cuts for the wealthy. The govt is or will be paying it back, but I wonder how much investment return was lost because of that.
Click to expand...

What? My generation is having less children than the baby boomers. How in the world will there be more working then taking out? Birth rates are technically below replacement rates while population growth is held up by the age of the population and immigration. If a male birth control pill ever works(this recent one works but is turning out to be extremely risky and likely will be dropped) then you will likely see birth rates below 1 easily.
 
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JoeTheEconomist said:
Walk me through your idea. You want a general fund subsidy to pay Bernie Sanders and his wife $50,000 per year while workers labor under 100,000s in student loan debt? Walk me through the logic of that. Separately, no one projects surpluses in the future of SS - ever.
Click to expand...

You don't need me to hold your hand.

Your lame dodge tells me you understand it, an actual fix simply doesn't comport with your equally lame agenda.
 
late said:
There are a number of ways to fix SS.

I favor a mix of the available options. The first is to stop pretending it's something different, it's just another govt program, fold it into the general fund. Second, SS will run massive surpluses in the future. Let it run a debt for a while, the surpluses will take care of it. Third, stop the weaseling by the wealthy.

If you did all of them, we could reduce the cost of SS on young workers, which would also be a smart thing to do.
Click to expand...

Or you could just handle it like a very conservatively managed IRA with approved, super low-risk investments and a low tax on the earnings to fund indigent needs. Allow the monies to be inherited (with the stipulation that they go into the heirs retirement accounts) to keep the excesses out of the gov't hands and in the private sector's. A 20 year phase in period with existing accounts rolled up into private accounts would work just fine.

Now start telling me all the things that are wrong with my proposal since I didn't make every single nit-picking detail perfectly clear, so that you can dismiss a working solution that your ideology hates.
 
Lutherf said:
After the purges there will be a surplus!
Click to expand...

That's right. Let's make physicians assisted suicide legal nationwide and make sure that anyone over the age of 65 is mailed their own personal suicide packet with a note from their gov't assigned Dr. informing them that due to their advanced age and high potential for long term health risks, they are already pre-approved for suicide. :mrgreen:
 
faithful_servant said:
Or you could just handle it like a very conservatively managed IRA with approved, super low-risk investments and a low tax on the earnings to fund indigent needs. Allow the monies to be inherited (with the stipulation that they go into the heirs retirement accounts) to keep the excesses out of the gov't hands and in the private sector's. A 20 year phase in period with existing accounts rolled up into private accounts would work just fine.

Now start telling me all the things that are wrong with my proposal since I didn't make every single nit-picking detail perfectly clear, so that you can dismiss a working solution that your ideology hates.
Click to expand...

I have a portfolio. The waitress that warms up your coffee doesn't have a portfolio.

There are a number of other problems, but the tenor of your post tells me you are aware of them. Don't forget to build the poorhouses.
 
JoeTheEconomist said:
MarketWatch published three columns on the retirement age for Social Security.

This piece is from Jason Fichtner from Mercantus says that retirement age needs to move to 70. "The harsh reality is that Social Security wasn’t designed to finance 20 to 30 years of retirement."

The retirement age for Social Security needs to rise to 70 - MarketWatch

This piece is from Chris Farrell from MarketPlace which says that retirement age needs to move to 76.

Should the Social Security retirement age be 76? - MarketWatch

I contributed a contrast piece which said that the problem isn't that we are living longer. The problem is that more of us are living average. Up to now, the changes in life expectancy have made the system more solvent not less.

Why the age for Social Security benefits doesn’t need to go up to 70 - MarketWatch
Click to expand...
Only the wealthy are living longer to any measurable degree. The deal needs to stay as it stands, it was their deal, they took the money so now they need to make good on it, oh and they need to put back the money that they stole (opps, borrowed, silly me).
 
late said:
I have a portfolio. The waitress that warms up your coffee doesn't have a portfolio.

There are a number of other problems, but the tenor of your post tells me you are aware of them. Don't forget to build the poorhouses.
Click to expand...

I thought you were supposed to be build the poorhouses while everyone else paid for them.
 
longview said:
No, I do not see any surpluses in SS future!
I do not think they have the political will to fix it, and so will apply band-ads,
until it is no longer functional.
I see means testing as simply a likely way they will try to keep the system alive longer.
They will hold up someone like Bill Gates, and ask, does he really need his $2000 a month SS check?
The down side is such means testing is effectively a tax on those of us who are actually preparing for retirement.
Click to expand...

Sorry I conflated your response with the guy who thinks that there are surpluses in the long-run. Means-testing does very little, but you have to ask if we are going to means-test the program why have it at all. It is a highly inefficient form of welfare. If that is your belief, why not just end the program and transfer the resources to a real welfare program. Faster solution, at a fraction of the price.
 
Casper said:
Only the wealthy are living longer to any measurable degree. The deal needs to stay as it stands, it was their deal, they took the money so now they need to make good on it, oh and they need to put back the money that they stole (opps, borrowed, silly me).
Click to expand...

I would be careful of those studies. It is very difficult to measure the chicken and the egg. Poor health is a factor in wages. So it may not be that low-wages cause shorter life-expectancy. It may be that crappy health causes both low-wages and shorter-life expectancy. I can show you studies that conclude that income inequality is not a primary driver of shorter life expectancy.
 
faithful_servant said:
That's right. Let's make physicians assisted suicide legal nationwide and make sure that anyone over the age of 65 is mailed their own personal suicide packet with a note from their gov't assigned Dr. informing them that due to their advanced age and high potential for long term health risks, they are already pre-approved for suicide. :mrgreen:
Click to expand...

Remember Logan's Run? That will be us.
 
longview said:
There will be fewer and fewer workers for each beneficiary.
I think they can still fix SS, but the changes at this stage would be unpleasant.
I look for them to start means testing income, where say each $2 of outside income above $3000 a month,
reduces the persons SS by $1.
They used to do something this for people on SS, who still worked before age 70.
I could easily see them applying it to all types of earnings.
Click to expand...

The boomers had a declining birth rate near the end of that generation...toward 1975. So as the older ones die, the number of beneficiaries should decrease somewhat.

The birth rate increased from 1975 to 1990.

The labor force has continually increased from 1990 to 2015, despite the birth rate going up and down. Influx of immigrants after Reagan's amnesty in 1986, plus more women entered the work force (which also contributed, I imagine, to the lower birth rate).

But it never hurts to have a surplus, so if it's tweaked to make it more sound, that might be the way to go. They've done it before.
 
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