Senior Spotlight: The Retirement Age Debate Is On

Did you know that 2024 is poised to see the greatest surge of Americans turning 65 in one year? If you look at the Peak 65 website, you can see how many people have turned 65 today alone (as of this posting at 9:33am on 2/14/24, 4,751 people have had this milestone birthday today!). The Retirement Income Institute at the Alliance for Lifetime Income estimates that 11,200 Americans turn 65 everyday, which accounts for 4.1 million people per year and is projected to continue for the next 3 years.

The age of 65 has traditionally been considered the retirement age, as this denotes when individuals become eligible for Medicare coverage. CNBC also summarizes that “…for Social Security benefits, the full retirement age — when a qualifying worker is eligible for 100% of the benefits they earned — is moving to 67 for anyone born in 1960 or later.”

You may be wondering why the retirement age is a topic of debate, and maybe even be surprised to hear that it is controversial in the US and around the world. (Last year, France endured fierce protests when their pension reform moved the retirement age from 62 to 65.) There are two main ways in which the retirement age impacts aging Americans. First of all – it is a question of funds. Moving the retirement age older shifts when funds are distributed and benefits are paid out, a huge governmental concern as funds dwindle and more beneficiaries age into Social Security and Medicare. Raising the retirement age is deemed a benefit cut, one that accounts to a 20% reduction in lifetime benefits for recipients (according to the Center on Budget and Policy Priorities).

The second issue is that certain industries are aligned to work only until retirement age. Pilots face age caps from commercial airlines who do not enable them to fly past 65; similarly, there are issues with doctors getting insurance to perform surgery or practice past a certain age. Naturally every worker from every industry is impacted when they cannot draw benefits or receive Social Security at the age they have been planning for.

The retirement age debate is an ongoing one, and an example of why having a diversified retirement income and a strategic retirement plan is necessary for your future. You have always heard not to put all your eggs in one basket… and now there is a shift towards staying in the coop longer! How do you feel about the retirement age being raised?

Resources Used: As Baby Boomers Hit ‘Peak 65’ This Year, What The Retirement Age Should Be Is Up For Debate ; Peak 65, Baby Boomers Are Reaching ‘Peak 65,’ But Retirement Age Debate Continues

Best wishes,

Bobbi

Bobbi Decker
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