Wednesday, April 13, 2011

More Pension Penciling

To solve the pension problem, make workers work longer: I've heard it before and I've passed judgment on the point, however briefly. But here's a point which (though it cannot be original with me) I have not seen in the debate so far. That is: consider retirement protection as a function of lifespan.  The average American 65-year-old male can look forward to something north of 17 years of life.   In 1940, by Social Security's own account, it was more 12.7 years.  Translated into percentages, that means that a 1940 retiree was looking forward to a retirement equal to 16 percent of his working life.  The comparable figure today would be 20 percent.  So to have the same percentage of life in retirement, today's retiree should keep working until he is a bit over 68 1/2.


Anonymous said...

As has been mentioned before, though, the 'able to keep working longer, having a longer lifespan' portion of the population is the wealthier portion which is not as reliant on things like social security etc. anyhow.

Any extension of retirement age will be a proportionally greater burden on the poorest members of society. It is easy to talk about not retiring for a few more years when you work at a desk job like myself. I doubt that things are nearly so rosy for a lifelong construction worker.

Buce said...

Copy that. I'm 75 and I work because some people are just lucky, that's all (I might even consider doing it for free but you don't need to tell that to the boss). I'm sure I'd operate under a different utility function were I a hod carrier.

dilbert dogbert said...

I stopped working at 65 because I was taking up a high pay slot that the younger workers needed more than I.
Stopped working for pay that is. I do a lot of work related to maintaining a house, cars, horses, wife and children. I just spread 3 yards of decomposed granite in various spots around the horse turnout area and garden. I used to joke with the wife that I went to work to rest up from all the stuff I did for her.

Ebenezer Scrooge said...

@dilbert dogbert:
My wife and I go to work to seek an oasis of serenity and calm. Yes, we do have a three-year-old and a large young dog. Why did you ask?