Thursday, March 25, 2010

Why Don't We Higher the Age For Collecting Social Security Benefits?

Posted by Teresa at 9:26 AM
Social Security payouts now exceed more than it receives in
payroll taxes, according to The New York Times. I read this
today on the Social Security web site:

If we look at life expectancy statistics from the 1930s we
might come to the conclusion that the Social Security
program was designed in such a way that people would
work for many years paying in taxes, but would not live
long enough to collect benefits. Life expectancy at birth
in 1930 was indeed only 58 for men and 62 for women,
and the retirement age was 65. But life expectancy at
birth in the early decades of the 20th century was low
due mainly to high infant mortality, and someone who
died as a child would never have worked and paid into
Social Security. A more appropriate measure is probably
life expectancy after attainment of adulthood.

As Table 1 shows, the majority of Americans who made
it to adulthood could expect to live to 65, and those who
did live to 65 could look forward to collecting benefits for
many years into the future. So we can observe that for
men, for example, almost 54% of the them could expect
to live to age 65 if they survived to age 21, and men who
attained age 65 could expect to collect Social Security
benefits for almost 13 years (and the numbers are even
higher for women).

Why don't we just raise the age of when Americans can receive
Social Security benefits? It makes sense to me.

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