The Social Security Administration was created in 1935 when the age to retire was set at 65. However, few Americans reached the age to retire because life expectancy was much lower at that time.
While men in the USA had a life expectancy of 59.9 in 1935, women lived about 63.3 years. Therefore, there were not many citizens who could live to get retirement benefits and others did not collect them for long. Currently, life expectancy is about 79 years for Americans, so they could get benefits for 17 years.
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IS RAISING THE AGE TO FILE FOR SOCIAL SECURITY SENSIBLE?
Some experts believe that it would be necessary to raise the age to retire. Many retirees rely on Social Security benefits for more than 20 years. When the system was created, retirees did not collect retirement checks for so long.
Other experts claim that it is not possible to get enough taxes from high earners to fund Social Security benefits. What is more, other people believe that there is no need to retire.
Working can be a way to be active and have a purpose in life. Raising the retirement age could also delay the date when Social Security could run out of money. The 2022 OASDI Trustees Report revealed that the reserves could be depleted in 2034.
REASONS TO DELAY FILING FOR SOCIAL SECURITY
If things remain the same, Americans can decide whether to file at 62 or to wait until they reach the Full Retirement Age. Others may prefer to delay retirement until they are 70.
Each worker may have a different reason for filing at 62, 67, or 70. In general, early retirement reduces your benefits by 30 percent, but you have more chances to get more monthly payments from Social Security.
The only way to get 100% of your benefits is to file at Full Retirement Age. That is 67 if you were born in 1960 or later. Filing at 70 is the best thing you can do to get 24% extra from the Social Security Administration.