We Are Living Longer
Using data for 2009 from death certificates in all 50 states, the national Centers for Disease Control has concluded that we are living longer. A male infant’s projected life span has risen .2 years to 75.7 while a female infant’s life expectancy is up .1 years to 80.6. An interesting chart in the report notes projected longevity for ages 0-100. Females at age 100 are estimated as having 2.2 years left. 65-year old males have a projected life span of 82.3.
- Gradually increase the age that we start to receive Social Security benefits.
- Gradually increase Social Security taxes.
- Decrease what higher earners receive.
- Encourage more personal retirement saving.
The Economic Lesson
The future of Social Security takes us to two basic concerns.
- Life expectancy: When Social Security was created in 1935, the average lifespan was 64 and benefits could begin at age 65. Now, life expectancy can extend beyond 80.
- Ratio of workers to beneficiaries: Called pay-as-you-go, the Social Security system has current workers funding retirees’ benefits. Because of the baby boomers, the worker/retiree ratio is plunging. In 1950 there were 16 workers for every beneficiary and now it is 3:1. The projection for 2025 is a ratio of 2.3 workers for every retiree.