retirement

Rethinking Retirement: Opinions, Obstacles, Opportunities

David White — Tue, 15 Jul 2008 08:39:45 -0400

More than just numbers: Public Agenda president Ruth Wooden and Rich Wolf, economics reporter for USA Today, talk about the challenges and opportunities the nation faces with an unprecedented number of Americans at or near retirement age.

What's retirement going to be like for you? Your parents? Your neighbors? With an unprecedented number of people closing in on that milestone, how is the U.S. going to change? How should it change? Does the graying of America present opportunities as well as challenges to a nation already wrestling with a stressed economy and an oversubscribed federal budget?

Hundreds joined us in person and online Wednesday, June 25th, in Washington, D.C., for "Rethinking Retirement: Opinions, Obstacles, Opportunities," a panel discussion on an issue that affects us all - from the tens of millions approaching retirement, to citizens so young they can barely imagine studying a Social Security statement or launching a second or third career.

The forum, sponsored by the Urban Institute, Civic Ventures and Public Agenda, was held at the Urban Institute, which has an audio webcast of the event available for those of you who missed the event.

Rich Wolf, economics reporter for USA Today, was the moderator. The panelists were: John Gomperts, president of Civic Ventures and CEO of Experience Corps; Eugene Steuerle, Urban Institute senior fellow and vice president of the Peter G. Peterson Foundation; Ruth Wooden, president of Public Agenda; and Sheila Zedlewski, director of the Income and Benefits Policy Center at the Urban Institute.

Future generations of older Americans will be better educated than their own elders and probably healthier too. Declines in the need for physical strength to perform many kinds of jobs will allow some older Americans to work longer, a trend that may partly offset demographic pressures. The talents and energy of older people may also be harnessed in new, socially rewarding "encore careers" or volunteering. At the same time, many in the diverse older population don't have the job skills that will be in demand and many won't be healthy enough to work or volunteer.

Beginning with a demographic profile of the nation's 77 million Baby Boomers and their elders, experts at the Rethinking Retirement conference took a look at new data on how those approaching or in retirement are thinking about retirement and later life and how their attitudes fit with economic and social realities and their own preparations.

Subjects on the agenda also included the ways retirement has changed over the past half-century and why it will continue to evolve. What new institutions, social policies, and career arrangements are needed to meet the needs of seniors and younger generations while at the same time addressing economic priorities and realities including red ink in the federal budget?

Another key topic: with the number of Americans age 65 and older set to double in the next 40 years, the cost of retirement, health and long-term care benefits could impact public spending on other priorities. A surge of retirees could also shrink the labor pool, threatening economic growth and living standards.

Early retirement is an act of selfishness

Peiting Chen — Fri, 23 May 2008 11:36:00 -0400

From Minneapolis Star-Tribune

When I hear my fellow baby boomers gleefully talk about their elaborate plans to retire ASAP, head for the Tuscan hills, or otherwise continue their lifelong quest for "self-actualization," I have to bite my tongue.

It's not that I'm all work and no play. But there's just something - make that lots of things - wrong, in general, with retiring at 55, 62 or even 65. I would go so far as to call it profoundly selfish and unpatriotic.

Dropping out of the work force while still in one's prime means ending one's contributions to America's strength, mortgaging our children's and grandchildren's future and leeching trillions of taxpayer dollars from the economy. An exaggeration? Perhaps. Some people, it is true, do not have the good health to continue working. And yes, many jobs are pretty miserable; it's easy to understand the desire to say, "Arrivederci, 9-to-5."

However, if Americans retired later, either staying in their current jobs or taking up "encore careers" - what Marc Freedman of Civic Ventures calls do-good, later-life jobs - we could significantly slow the growth of our multitrillion-dollar national debt, which is largely driven by rising Medicare and Social Security costs (as yesterday's Social Security trustees' report makes abundantly clear). We also could keep more people in a labor force that would no longer be growing appreciably if not for immigrants.

Thus, working longer would increase national output and personal wealth. And given our nation's crying need for teachers, social service workers and public servants, millions of "seasoned citizens" could serve our communities while giving meaning and money to people with decades of life and activity left in them.

When Social Security was enacted in 1935, with full benefits kicking in at 65, the average life expectancy in America was 63 and the average American worked nearly until he (or she) died. Today, life expectancy at birth is 78, and the average retirement age is 62. Well, maybe all of this is about achieving the "good life," "pursuing happiness" and other bromides suggesting it is great to stop working as soon as possible. Some Silicon Valley multimillionaires retire in their 40s and are widely envied.

However, since most Americans are much healthier at 60 or 65 than their grandparents were, we should be able to work longer. Few 62-year-olds in our youth-obsessed culture would want to be called "old." Yet three-fourths of 62-year-olds draw benefits from Old Age, Survivors and Disability Insurance - otherwise known as Social Security. No wonder that the Urban Institute's C. Eugene Steuerle calls Social Security a "middle-aged retirement program."

For individuals, working longer can mean more income and savings and something to bequeath to one's children. For the nation, if millions of us worked until 67 instead of 62, Americans' wealth and consumption would increase appreciably, fueling stronger economic growth. That added income would provide about $800 billion in additional tax revenues, and reduce government benefit costs by at least $100 billion in 2045, according to Urban Institute calculations. This alone would cut the projected deficit in 2045 by 159 percent.

To encourage such behavior, Social Security benefits taken before age 66 or 70 could be more highly taxed, and employee rates of Social Security taxation could be progressively reduced for each year worked after 66 or 70. Or the government could provide a similar sliding tax credit for Americans who continue working beyond age 70.

Democratic Sen. Herb Kohl of Wisconsin has introduced legislation to reduce lost public and private benefits for those who work until 72. Other disincentives to working longer could be eliminated. Democratic Rep. Rahm Emanuel of Illinois has proposed creating 401(l) accounts - tax-deferred accounts with employer matches - to help middle-aged workers fund their retraining and education.

For everyone's good, Americans should at least be able to work as long as their shorter-lived, poorer grandparents did. By doing so, they would be unselfishly helping preserve and strengthen our nation's future by alleviating - rather than worsening - our national debt and making hands-on contributions to our children and communities.

Andrew L. Yarrow, Washington director and vice president of Public Agenda and a professor of U.S. history at American University, is the author of the forthcoming book "Forgive Us Our Debts." His e-mail is ayarrow@publicagenda.org.

Elusive Consensus

Jenny Choi — Wed, 21 May 2008 11:44:54 -0400

Although majorities say the Social Security program is in trouble, few can agree on proposed ideas for changing it. About half of Americans say the government needs to make changes to the system sooner than later, but other legislative issues such as Iraq and terrorism rank even higher.

Mixed Messages on Responsibility

Jenny Choi — Wed, 21 May 2008 11:39:23 -0400

There are often inconsistencies between how people define their own financial responsibilities and how willing or able they are to save for retirement. Few Americans say individuals should be asked to pay for a greater share of the nation's retirement system. And although less than one-quarter of Americans believe Social Security will be able to pay them full benefits when they retire, majorities say they're confident about having enough money to live comfortably. Yet few have calculated how much they will actually need. Furthermore, most Americans believe that most people don't save enough money for retirement.

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jwilliams — Thu, 08 May 2008 12:55:26 -0400

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jwilliams — Wed, 07 May 2008 11:47:53 -0400

Make economic security in retirement a personal responsibility