Raise Retirement Age Now, Actuaries Say

Actuaries are urging policy makers to raise the retirement age as the first step to shoring up Social Security and keeping younger workers from bearing the brunt of painful tax increases. The American Academy of Actuaries issued a policy statement suggesting that "holding the retirement age constant is a certain prescription for future financial problems." The normal retirement age for Social Security was last raised in 1983, from 65 to 67 over a phased-in period. All workers born in 1960 and after have to wait until age 67 to receive full benefits. In order to avoid major disruptions to the Social Security system, officials should raise the retirement age now, they said. The organization's VP for pension issues said they think if you dig in and make these changes now it gives people time to plan. It gives people time to anticipate that now I'm age 35, I'm looking at an age 68 or 69 retirement for Social Security, and that gives you a lot of years to plan for it, he said. The org. pointed to figures showing that, since 1940, the life expectancy of American men who reached age 65 had increased by nearly five years. Women who reached 65 saw their life expectancy increase by nearly six years in the same period. He said raising the retirement age isn't going to solve the whole problem and likely would be part of a package of solutions, but noted that because of the long-term projections, the retirement age is the best place to start. He said if we delay and wait, we're more likely as a nation to have to sort of jolt the system much more potently and hurt a lot more people unexpectedly. Presumptive presidential nominees Sens. Obama and McCain skirted the issue in policy statements on Social Security. But Obama's advisers recently pledged that he wouldn't raise the retirement age, a step McCain hasn't taken.