More than 10,000 people turn 65 every day in the United States, and that number is expected to peak at about 12,000 in the summer of 2024. As more baby boomers reach traditional retirement age, this demographic bubble will affect everything from healthcare and politics to demographics. Leading the workforce into the future of Social Security and Medicare.
“This is a demographic shift in some ways, but it has huge implications for our society and how it operates,” said Gal Wetstein, senior research economist at Boston University’s Center for Retirement Studies.
Social security is one of the schemes that is expected to be burdensome as it is funded by workers paying into the scheme. “The funding issue has been known for some time,” Wetstein said. “It’s not surprising. But the issue has been ignored.”
In the United States, there’s a term for when most people ever reach the traditional retirement age: “Peak 65.” It will happen in 2024, probably in the summer when birthdays increase.
Jason Fichtner, director of the Retirement Income Institute at the nonprofit Alliance for Lifetime Income and chief economist at the Center for Bipartisan Policy, wrote about Peak 65 in 2021. white paper for the sake of the alliance. Fichtner said it’s important to think about the fiscal stress caused by an aging population in two ways.
“Aging from above leads to changes in social spending,” he says. “This will lead to higher health care costs, higher pension spending, and lower education spending. Aging from the bottom up will lead to changes in income as the number of workers decreases relative to the total population.”
Is there social security for retirees?
The Social Security General Trust Fund will be depleted in 2034, at which point only 80% of benefits will be paid. In his State of the Union address this year, President Joe Biden vowed to defend Social Security and Medicare.
read: Social Security expected to fail to pay in full a year earlier than expected
Lawmakers have also made various proposals to strengthen social security, such as raising taxes on the ultra-rich and creating a special sovereign wealth fund, but none of them has received much support.
“Social Security is already under great pressure. While 65 is no longer the age of full retirement, people between the ages of 62 and 70 are joining Social Security for the first time, and the pressure on the system is increasing. It’s going up,” said Joanna Leahei, a professor at the Bush School of Public Administration. Served at Texas A&M University.
For baby boomers, full retirement age Somewhere between 66 and 66 years and 10 months. For those born after 1960, that age is he is 67. People can start receiving reduced benefits from the age of 62.
“Government programs such as Social Security may need to start leveraging general funds rather than self-funding, something that would have been unthinkable five to 10 years ago,” said Lahey, referring to baby boomers. generations will likely also need to keep working longer to supplement social security income, he added.
New School economics professor Teresa Guilarducci says the impact of baby boomers reaching retirement age is no secret, but the situation is getting more dire for the average baby boomer with each passing year. Stated.
“Each year, the typical member of the new group of 65-year-olds has less retirement income security. people tend to have less secure assets and less social security,” Ghirarducci said.
“Economically insecure older adults will increasingly seek part-time and full-time jobs, which means more people will compete for jobs, putting downward pressure on wages and working conditions. It will happen,” she pointed out. “We are already seeing some low-wage industries relying on low-wage older workers. [such as] Home care and personal care occupations, managed services, etc.,” said Ghirarducci.
Also read: “This is a win-win”: Federal programs help the “most vulnerable” seniors find jobs and help employers facing labor shortages.
In addition to modernizing the retirement system, the safety net needs to be strengthened in the United States, where an ever-growing proportion of older people in the population, says Catherine, chief executive and president of the Transamerica Institute, a private research and education foundation.・ Mr. Collinson points out. Transamerica Center for Retirement Studies. “We need new solutions for affordable housing, an aging society, long-term care services and support so that every American can live out their final years with dignity and security,” she said. .
Baby boomers still have political power
Lahey said he expects to see a number of workplace and technology innovations focused on helping older workers continue to be productive.
“I think we are already seeing this kind of innovation in the medical field, for example, with machines that help nurses lift patients. It’s something we’re looking forward to, and we’re seeing more of it,” she said.
Experts agree that baby boomers have not lost their power to change things.
Since the birth of the first boomers, they have made their presence felt both politically and culturally. “This trend will continue and probably increase as they retire and have more time to vote and be politically active,” Lahey said.
And because the group constitutes a large voting bloc, politicians will spend more energy on topics focused on people over 65, Wetstein said.
Collinson said the same thing. “Baby boomers have been rethinking and rewriting the rules of society at every stage of their lives. , is paving the way in old age, which is an important part of the solution,” she said.
“Socially, baby boomers need to continue to drive positive change to pave the way for future generations. They have strength in numbers, voting power and voice.”
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