SS Fix / Peg it to Life Expectancy

This seems like such a simple idea and yet I haven't really heard much talk about it at all.

For each year the national life expectancy average goes up by 6 months raise the full benefits age for taking SS by 6 months for people under 50. Once you hit 50 your personal benefits are "locked in."

SS was never designed to take care of people for decades and decades at a time. This automatic adjustment would mean we can leave it on auto pilot and not worry about having this debate over and over again every decade.

Haven't heard much of it? Over here the pension age is being raised, precisely because life expectancy also increased. And it will rise with it in the future.

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Originally Posted by Lewkowski

This seems like such a simple idea and yet I haven't really heard much talk about it at all.

For each year the national life expectancy average goes up by 6 months raise the full benefits age for taking SS by 6 months for people under 50. Once you hit 50 your personal benefits are "locked in."

SS was never designed to take care of people for decades and decades at a time. This automatic adjustment would mean we can leave it on auto pilot and not worry about having this debate over and over again every decade.

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That's the traditional private Insurance Model used for Life Insurance, not pension plans. What you're missing in the equation is that most retired / elderly also use Medicare for their costs of health care, but it's not modeled on private health insurance. If it were, the oldest and sickest could never afford the premiums.

Besides, if people work from age 50 to 70, and have their wages deducted to go into SS, they should benefit from feeding the kitty. If you "lock in" SS benefits at age 50, with no room for hope of increasing monthly pay-out.....no one would work past age 50. :donkey:

*Or they would, but wouldn't want to lose wages paying SS deductions they don't benefit from*

And if elders did keep working, think of the impact that would have on the job market.

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Originally Posted by Being

And if elders did keep working, think of the impact that would have on the job market.

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It already has made an impact on attrition, and younger workers wanting in but can't find a spot as retirement age is extended. Retirees are already "going back to work" at least part-time, to make up for 401-K losses, just trying to make ends meet.

We can fiddle with retirement age and life expectancy until the cows come home. What we really need to do is ask if SS is a national retirement pension plan everyone can rely upon, a supplemental insurance plan with limits and caps, or elder welfare.

Lewk, it's absurd you think this is news. The fix for SS has always been increasing the eligibility age a little bit.

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Originally Posted by wiggin

Lewk, it's absurd you think this is news. The fix for SS has always been increasing the eligibility age a little bit.

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Agreed that Lewk is being absurd. But he's an insurance shill, so there ya go.

I disagree that increasing age eligibility is a panacea. As it is, SS can't be considered a reliable "pension" for anyone. The elder poor either need supplemental SS disability, veterans benefits, Medicaid, food stamps, rental assistance, utility and transportation subsidies as adjuncts to SS. Not many people can live on $15,000 a year. Especially the elderly that couldn't make it to $250,000 of retirement savings just to pay for expected medical costs or long-term care.

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Originally Posted by wiggin

Lewk, it's absurd you think this is news. The fix for SS has always been increasing the eligibility age a little bit.

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Yes as a one time fix. Or gradually increase age up to X age. I've yet to hear a major politician suggest permanently attach it to life expectancy.

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Originally Posted by Being

And if elders did keep working, think of the impact that would have on the job market.

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http://en.wikipedia.org/wiki/Lump_of_labour_fallacy

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Originally Posted by Lewkowski

Yes as a one time fix. Or gradually increase age up to X age. I've yet to hear a major politician suggest permanently attach it to life expectancy.

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You also have yet to hear any major politician suggest it should be means-tested. Because that would mean changing SS to Elder Welfare. And we all know what Republicans think of any type of Welfare, and the recipients. :donkey:

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Originally Posted by GGT

You also have yet to hear any major politician suggest it should be means-tested. Because that would mean changing SS to Elder Welfare. And we all know what Republicans think of any type of Welfare, and the recipients. :donkey:

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SS already is means-tested. If you have other income coming in the SS on top if it is taxed at a higher bracket.

Why lock it at 50? So life expectancy raises in a few more years to over a hundred and not even half-way through people's lives its already locked?

Also 6 months/year is an exaggeration, 2 years/decade is more like it, which is 2.4 months per year or 10 weeks per year.

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Originally Posted by RandBlade

Why lock it at 50? So life expectancy raises in a few more years to over a hundred and not even half-way through people's lives its already locked?

Also 6 months/year is an exaggeration, 2 years/decade is more like it, which is 2.4 months per year or 10 weeks per year.

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More certainty in retirement planning.
Ease of passing the law (if only effects people currently under 50 AARP is going to bitch less about it)

That being said I wouldn't mind adjusting the age it locks in as life expectancy increases as well.

But life expectancy changes rapidly, as medical science evolves. Those born today in the US can expect an average life expectancy of 75-78 years, depending on gender. It's not really gender that's the variable, but medical science knowledge and its advances. Those things that benefit from *cough* federal funding.

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Originally Posted by GGT

But life expectancy changes rapidly, as medical science evolves. Those born today in the US can expect an average life expectancy of 75-78 years, depending on gender. It's not really gender that's the variable, but medical science knowledge and its advances. Those things that benefit from *cough* federal funding.

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As I stated before there are benefits for locking in benefits. Both for passing the measure and for the ease of use in terms of long term financial planning. Its hard to make retirement decisions if your benefits can change rapidly.

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Originally Posted by Lewkowski

As I stated before there are benefits for locking in benefits. Both for passing the measure and for the ease of use in terms of long term financial planning. Its hard to make retirement decisions if your benefits can change rapidly.

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Translation: the insurance industry would rather "lock-in" benefits at age 50, so they can also "lock-in" the science of that time. Biomedical science is moving too fast for the insurance industry to find rationale for their exclusions. If it turns out that 99% of cardio-pulmonary disease is NOT related to lifestyle choices like smoking or over-eating, or intake of "bad fats", but pre-determined genetics, the insurance companies are screwed.

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Originally Posted by GGT

Translation: the insurance industry would rather "lock-in" benefits at age 50, so they can also "lock-in" the science of that time. Biomedical science is moving too fast for the insurance industry to find rationale for their exclusions. If it turns out that 99% of cardio-pulmonary disease is NOT related to lifestyle choices like smoking or over-eating, or intake of "bad fats", but pre-determined genetics, the insurance companies are screwed.

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Boggle. I have no idea what you are ranting about.

But anyway its pretty settled that there is a strong correlation between life style choices (eating junk food, not exercising) and having shorter life spans. Do you disagree?

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Originally Posted by Lewkowski

Boggle. I have no idea what you are ranting about.

But anyway its pretty settled that there is a strong correlation between life style choices (eating junk food, not exercising) and having shorter life spans. Do you disagree?

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Yes, I disagree with how you portray life expectancy and lifestyle. Life span is correlated to much more than life style choices, even though those choices evolve and change over time, along with science and cultural changes.

Just seen the UK's annual budget and the Chancellor has just announced plans for a "more automatic" mechanism for increasing retirement age with life expectancy :up:

Quite apt given this discussion. Will we be the first nation to do this?

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Originally Posted by RandBlade

Just seen the UK's annual budget and the Chancellor has just announced plans for a "more automatic" mechanism for increasing retirement age with life expectancy :up:

Quite apt given this discussion. Will we be the first nation to do this?

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Congratulations...you may be the first man to retire at age ninety. :up:

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Originally Posted by GGT

But life expectancy changes rapidly, as medical science evolves. Those born today in the US can expect an average life expectancy of 75-78 years, depending on gender. It's not really gender that's the variable, but medical science knowledge and its advances. Those things that benefit from *cough* federal funding.

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A) life expectancy doesn't change rapidly, it changes fairly slowly. B) I think you're misinterpreting what Lewk said. Of course life expectancy changes, that's why he wants to put a mechanism into place to start adjusting for that. *technically there already is one, Congressional fiat, but handling this legislatively hasn't proven to be the best idea* And people who were eligible three months ago but are not now eligible are a bureaucratic nightmare so that adjustment mechanism needs to get "locked" to stop pushing back their benefits eiligibility at some point before they start collecting the full amount.

Well if he can work and wants to, more power to him...:p

However, SS is not a retirement package, was not meant to be. I'm not planning on it, and anyone here 40 and younger (and US citizen) should not be either.

It's supplemental at best, and was originally designed to not be awarded anyway (life expectancy vs. when you could collect), or at least for not very long.

By the time I'm 62/65/67 or what ever the age is/will be, I don't expect to be retired even if I have a gazillion $$$ between my ROTH IRA and 401k, as I don't see myself being bored for the next 20-40 years.

Also by that time those in their 20's now reach 'retirement age' I would expect it to be higher. If we are living to 100 with 70 to 80 being still functional/productive, why not? SS paying out for 30+ years will only further burden the system.

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Originally Posted by RandBlade

Just seen the UK's annual budget and the Chancellor has just announced plans for a "more automatic" mechanism for increasing retirement age with life expectancy :up:

Quite apt given this discussion. Will we be the first nation to do this?

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What's the employment data looking like on elderly job seekers in the UK? And what's UK youth unemployment like these days?

Our country decided to do it too, though it's not completely automatic.

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Originally Posted by RandBlade

Just seen the UK's annual budget and the Chancellor has just announced plans for a "more automatic" mechanism for increasing retirement age with life expectancy :up:

Quite apt given this discussion. Will we be the first nation to do this?

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Nice!