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A recent paper published by Boston College’s Center for Retirement Research examined changes in the SS claiming age since 1985, and more recently during the Covid pandemic. The study shows that there has been a fairly dramatic decline in the percentage of those people claiming at 62 in the 20 years leading up to Covid, and that trend has remained steady since then. The study also shows that the average claiming age has increased by about 2 years. The study looks at several sources of data, and describes some interesting demographic anomalies (like a large spoke in the number of 62 year olds per year due to the baby boom). It’s an interesting read and seems to indicate a gradual move toward retiring later, as has been discussed previoulsy in various HD posts
Rick,
Always enjoy your posts. One nit to pick however is this sentence, “It’s an interesting read and seems to indicate a gradual move toward retiring later” where the study is about Social Security claiming.
These are two different, distinct choices. My wife and I both retired (I define as stopping a regular work schedule) at 62, but will not claim Social Security until 70, living off retirement assets and a small pension.
David, thanks. You are correct about the distinction, and my wife and I made similar choices to you and your wife. In the referenced article the CRR provides a different number for average retirement age and average cleaning age. I thought about addressing that but chose not to make the post longer, assuming interested people could read the full article. The article states that the average retirement age went up 3 years while the average claiming age went up 2 years. Thanks for pointing out an important distinction.
I’m 60 and struggle to open a water bottle. I swear they krazy glue them on just for fun.
I’m with you on the tiny bottle caps.
Plus after the 3rd or 4th attempt, I’m missing about 3 layers of skin on my fingers
A recent NY Times article on May 16 suggests that recent events have reversed the trend reported in the Boston College study.
Why Are So Many Retirees Filing for Social Security Earlier?An additional 276,000 people filed for Social Security benefits so far this fiscal year, up 13% from a year ago. Anxiety appears to be a driver.
An additional 276,000 retirees claimed benefits on their earnings record this fiscal year through April, according to the Urban Institute, a research group, a 13 percent jump from the same period a year ago. Officials inside the Social Security Administration called the rise “dramatic,” and though there were some other reasons for the surge, program experts say anxiety appeared to play a meaningful role.
“It is worrisome because for most people, claiming early is not a good decision,” said Jack Smalligan, a senior policy fellow at the Urban Institute. “They’re nervous about the threats to the Social Security Administration and their benefits, while simultaneously looking at their 401(k), if they have one, and worrying about that.”
Thanks. That is an interesting take. I found the Urban Institute article. One of the interesting impacts this year is the change in SS law due to the SS Fairness Act, as well as uncertainty with the SSA and market volatility. Who knows what direction this will take.
I’m very sensitive to the issue of raising the retirement age on certain occupations requiring physical labor. I have union carpenters and electricians in the family. I’ve done a fair share of DIY carpentry, plumbing, and electrical work and know how tough it is. But, as Dan says below, the current SS Normal Retirement Age (NRA) of 67 makes it an issue already. Technology will help (think power tools, modular home components, lifting equipment, …) some. the union retirement plans I’m familiar with allow person before SS NRA and help bridge the gap. I’m familiar with a number of retired tradespersons who supplement their retirement with “side jobs”. they can be a great source of extra income, and they can pick and choose the jobs. Good, reliable, experienced tradespeople are worth every penny.
Makes sense, as the number of manual labor, grueling jobs goes down, claiming ages ought to go up.
The WSJ had an interesting opinion article yesterday about Denmark changing their retirement age to 70 for those born in 1971 and later. That change by Denmark tied their retirement age to average life expectancy at age 60.
There are occupations that few people can physically perform to age 70 (let alone age 67). Still, considering how long we live now, compared with 1938, it makes sense that working longer may be part of the solution to funding SS.
I wonder if current workers were told the only two options (I know they are not) were to have a later retirement age of 1 year, or increased Social Security tax rate on pay of 5% shared by them and their employer, which they would choose.
I’ve had the same thought regarding some kind of multi-tier payroll tax for SS.
All you actually need is an increase of 1.75% on each for 75 year solvency and then adjust the rate and taxable wages regularly and automatically as needed to maintain solvency with no political action required.
What we have gotten into is unnecessary and inexcusable.
…. I’ll add disgusting to your list of adjectives Dick.
Dan,
Good comment!
I was a “professional” computer geek for over 40 years. (‘You mean they PAY me to do this fun stuff?’)
I was certainly physically able to continue working past 61. The heaviest thing I lifted was a computer to place it into a server rack.
Roofers and Carpenters and Plumbers and Construction Workers and many, many others do what has to be exhausting PHYSICAL work day in and day out.
Winston, I have lived the difference in occupations. Thirty years delivering beer from a side load truck; I have never known anyone who could do that to their 70th year.
Last 20 years preparing tax returns; I had no problem working until age 70. Heck, the tax gig was so simple that I now volunteer to do it for free.
Bill, thanks for the link. I had seen the announcement, but not read the article. I’ve seen suggestions that the US should change FRA to 70, and allow a reduced SS benefit at earlier years. A report by the American Academy of Actuaries shows that average life expectancy at 65 in 1940 was 11.9 years for men, and 13.9 years for women. In 2019 it had increased to 18.1 years for men and 20.7 years for women. It is expected to increase another 4 years by 2090.