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There’s renewed focus on the Social Security retirement age, thanks to recent Republican presidential debates.
The Social Security board of trustees projects the program’s combined funds will run out in 2034, when just 80% of benefits may be payable. To prevent that, lawmakers may generally raise taxes, cut benefits or a combination of both.
One possible change — raising the retirement age — was debated when the Republican presidential candidates took the stage in November.
“What we need to do is keep our promises,” Republican presidential candidate Nikki Haley said. “Those who have been promised, should keep it. But for my kids in their 20s, you go and say we are going to change the rules, change the retirement age for them.”
The retirement age has been raised before. In 1983, when Social Security faced similar solvency issues, legislation was passed that made a host of changes, including boosting the full retirement age from 65 to 67. That change is still getting phased in today.
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Full retirement age is when beneficiaries may receive 100% of the benefits they have earned. Those who claim earlier than full retirement age will have their monthly checks permanently reduced.
Those who wait — up until age 70 — stand to receive up to an 8% boost for every year they wait past full retirement age.
“The difference between an age 62 benefit and an age 70 benefit is about a 77% increase,” said Jason Fichtner, chief economist at the Bipartisan Policy Center. “That’s huge.”
If the retirement age is raised again, that may make it so early claimants face a steeper cut.
Despite the benefits of waiting until age 70, almost 90% of today’s retirees claim earlier.
“For the vast majority of people, waiting longer to collect Social…
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