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No Social Security until age 65?

By Jennie L. Phipps · Bankrate.com
Sunday, October 31, 2010
Posted: 10 am ET

I've already made up my mind that part of my retirement planning is to continue typing on this keyboard until my fingers don't work anymore. So I'm inclined to believe that a proposal from the American Enterprise Institute, a conservative think tank, to get rid of the option to take Social Security at age 62 is a good idea. The report advocates raising the first opportunity to claim benefits to full retirement age -- 66, rising to 67 in about 2020.

The author of the recently released report, Andrew Biggs, a scholar in residence at the institute, outlines these advantages:

  • Prolong the life of the Social Security trust fund by five years, a modest but significant increase.
  • Raise median income of older Americans by $7,500 a year, including both increased Social Security benefits and savings and other pension income.
  • Boost gross domestic product by about 5 percent through increased productivity, adding billions to the economy and tax revenues.

Biggs says keeping people working until 66 or 67 isn't a physical problem for most these days. He points to another study by David Cutler, a Harvard researcher, conducted for the Retirement Research Center in Boston, that concluded that 65-year-old men have the capacity to work 90 percent as hard as men in their late 50s, and work capacity only declines to 70 percent at age 75.

So Biggs says to keep most people who were born in 1952 and later on the job for another four or five years, while continuing to make Social Security disability available to those who are physically or mentally unable to work that long.

Biggs would offer one big concession. He suggests reducing significantly or eliminating Social Security payroll taxes for people who work and contribute to Social Security longer than 35 years, because the formula for calculating Social Security doesn't reward longer service. "The median individual receives only around 2.5 cents of additional benefits in exchange for $1 of additional taxes at the end of his work life," he writes.

Eliminating payroll taxes would "sweeten the pot" for those asked to work longer, he says.

That would make me lots happier. How do you feel about it?

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214 Comments
Pat Crowley
December 17, 2010 at 9:11 pm

All of this gibberish about raising the retirement age and/or eliminating the "early retirement at age 62" option does not address critical issues. One of the critical issues is that as folks are forced to work longer and longer, they do not make available jobs for others, which include younger Americans. Forcing people to work longer makes for nothing but a lot rhetoric; it certainly does not make sense. The simple fix is fund social security by taxing as much income as an employee makes. Don't give a free ride to those currently making over $109,000 per year. Tax it all. Fund it properly, and do not turn over social security to the Wall Street gangsters who were largely responsible for our economic meltdown.l

JLAB
December 17, 2010 at 6:09 pm

To say that keeping a 66 or 67 year old man working isn't physically a problem is pure B.S. Tell that to a 62 year old man who has spent his whole life working in construction! These so called experts don't have a clue!

sandra robertson
December 17, 2010 at 9:07 am

i started on ss at age 62 and sill working, i have a problem with them pentalizing me because of this . Why cant i draw my ss and make all i want before full retirement age. I am paying in and drawing too but what you draw isnt enough to live on so lots of us must continue to work.

Steve
December 17, 2010 at 8:31 am

Enough of this crap. I'm so tired of people suggesting they change the rules along the way to suit themselves. My company raped the pension fund in 1999 so the executives can line their pockets and they screwed the very folks that kept the company alive. I've paid into SS for 36 years and by the time I'm 62, when I WILL take my pension, I'd have paid into the fund for 44 years. If you want to change things, change it for young folks, who have time to attempt to secure their own funds for retirement.

Janet
December 17, 2010 at 8:19 am

I believe that Social Security was intended to supplement people that did not have enought to live on when they were too old too work.
But all of that has changed and S.S. is given to all kinds of people (even non american's). For instance to suplement a child that lost a parent. Even if one parent is still alive and no matter what the income is of that living parent. This is just one of many things that Social Security is being used for that was not in the eyes of those who wrote the S.S. laws. I believe that this program is and has been seriously abused. And it needs fixing so no elderly person suffers.

Richard
December 17, 2010 at 7:37 am

I am unemployed and cannot find a job due to my age (61 years, 4 months). I am praying each day to reach 62 years to draw social security, and you want to stop that. I will not say what I think of you.

carlos a
December 17, 2010 at 2:11 am

Let's cut the pay of the ineffective congress by $24,000 a year and put that money into the social security fund which would increase the fund by about 10 mil a year -- that ought to help the system out. No doubt the congressional members aren't earning the $174,000 a year they are being paid.

Richard Wang
December 17, 2010 at 1:04 am

You gotta be kidding me! How about THIS instead: eliminate the artificial "cap" on what income you have to pay social security taxes on! Why does it even exist? As of now, only the first $106,800 is subject to the tax. Why?? Do we stop taxing income for federal (or state) income taxes if one earns more than "X"? No! And how about doing more to get the unemployed back to work so that they are (a) earning more such that they can spend more in the economy and help grow it, and (b) be paying INTO the system instead of sucking public benefits OUT of it. And someone please explain WHY we want to give the top 2% of earners in the USA a gigantic stimulus (some are calling it a "tax break") on the backs of the rapidly-disappearing middle class and the rapidly-expanding lower class? If that's the program, why don't we just revert to feudalism and have just the elite "lords" and the lowly "peasants\serfs"?

Ed
December 17, 2010 at 12:57 am

I would like to see all the people who advocate raising the retirement age get off their fat asses and get out in the hot summer sun and swing a pick axe or dig a ditch eight or ten hours a day. I would bet that most of them couldn't even find a real job, let alone do one.

One problem I have yet to see these "brains" solve who want to keep people working longer: where are these jobs going to come from for these additional people in the work force?

Joe
December 16, 2010 at 10:35 pm

I have been paying into the system for 44 years. I turn 62 in 3 weeks. I intend to work for another 18 months and retire. I want the benefits that I have paid for, over $200,000 in SS tax alone including company contributions. Also, there are not enough jobs to go around now. Do you really want to keep all of the 62-66 year old people in the workforce denying younger people of the chance to work.