Is Retiring Early Putting Too Much Pressure On The System?
Because of the thousands of lost jobs and an increase in early retirement claims due to laid off workers, Social Security (S.S.)has a long battle ahead. Not only is S.S. on the way to bankruptcy, but now more than ever seniors are seeking social security. S.S. at this time and over the next two years will shell out out more in benefits than it collects in payroll taxes.
Retirees contributed to the fund throughout their working lives and now it’s failing them. Between 2010 and 2011 estimates forecast the bills will reach $19 billion. These deficits won’t affect the payment that seniors are getting but they will add to the federal deficit.
Since the recession, S.S. authorities have acquired 23 percent more applications for retirement benefits and 20 percent more for disability claims. Officials anticipated these claims to rise because of the growing numbers of baby boomers that are reaching retirement age. Although with the economy the way it is, officials have seen thousands more applications than they expected.
These ever increasing numbers have an explanation behind them. Some of the first workers to lose their jobs were potential retirees. Consequently they opted to retire, when they might otherwise have continued working.
However, the downturn has forced many other probable retirees to stay working. Many saw their life’s investments evaporate before their eyes and now they have to work and try to save up once more, with retirement age fast approaching.
Regrettably, many seniors are facing the choice of whether to accept social security or not. Some are trying to put it off as long as possible and find other jobs, because the longer they wait to take S.S. the higher their monthly check will be.
Even though many workers want to put off their S.S. checks, they are struggling to find a job. With limited job openings, and lots of workers available, many employers prefer hiring younger workers. So these baby boomers are not only competing against young college graduates, but also young professionals that have families to support.
Most retirees are able to pay nearly all of their bills, but it can be hard if they have lots of prescriptions and no health insurance. Most seniors want to continue working so they have more money than what is required to cover the bills.
Over 2.2 million people applied for retirement benefits from October through July and at the same time the year before it was 1.8 million. This means premature retirements are not only hurting the country in the short-run but also the long-run.
Social Security will have run out of funds by 2037, because of the way it was established. Unless Congress acts: the program is going to fall apart. Over 43 million retirees and 9.5 million disabled Americans are reliant on Social Security. The system will not be able to support them and future retirees unless Congress makes some changes.
Diane Johnson graduated with a Bachelor of Science from the University of Utah and enjoys writing about current events, politics, college degrees, education online, and the office.
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