We have been talking about the solvency problems that Social Security in the United States could soon face. As the debate on this issue continues in the various governmental instances at the federal level, we may see more changes in the retirement age in the future.
And we are going to analyze how the warnings of experts such as Grant Cardone and Drew Powers warn that Americans are going to have to wait longer and longer every year to be able to retire. The most pessimistic speculations are that the retirement age could be increased by up to 10 years.
You’ll Have to Wait Longer to Retire in the United States
A millionaire has issued a strong warning to Americans about a possible significant increase in the Social Security retirement age, warning that the social safety net program could run out of funds soon. However, other financial experts consulted by various US media have divided opinions on this prediction.
Until 2024, Social Security benefits are available from the age of 62, although the full retirement age varies between 66 and 67, depending on the year of birth, and some choose to wait until 70 to get the maximum payment, which, for this year, is $4,873.
However, Social Security is predicted to become insolvent in the 2030s, which has prompted millionaire Grant Cardone to warn that future retirees could be forced to work until the age of 73.
Who Is Grant Cardone and What Does He Warn About the Retirement Age in the USA
Grant Cardone, a well-known private equity fund manager and real estate investor, believes that the retirement age will increase significantly in the coming years. “You won’t retire at 63; it will probably be 10 years later,” Cardone told specialist website GOBankingRates.
According to his predictions, the Social Security Administration (SSA) will only be able to make full payments until about 2035. From that year, the system could face a severe funding crisis due to the retirement of the baby boom generation and the insufficient number of young workers to sustain the system.
Lawmakers have proposed several solutions to save Social Security, the most likely being reducing payments or increasing the retirement age. Cardone insists that Americans should prepare for the second option. “The money is going to run out,” Cardone said. “This system has been bankrupt all my life. So if you can’t keep people retired, people have to keep working to earn money.”
The increase in the retirement age might seem logical given that Americans are living longer. However, many fear that this will harm the retirement plans of many people. “Right now, 10,000 people are leaving the labor market every day,” Cardone explained. “Some of these people are 65 or 66 years old. They’ll live to be 91, not 84.”
Another Expert Says That the Retirement Age Will Be Raised, and That It Is Almost Inevitable
Drew Powers, founder of Powers Financial Group in Illinois, agrees with the idea that the full retirement age will be delayed. “There have been warnings about the solvency of Social Security for decades,” Powers told the Newsweek news website.
“As Americans are living longer and better, they’re collecting Social Security for longer, and there’s incredible pressure on the trust fund. Although no one will want to wait any longer to get paid, the even more unpopular options are to increase taxes or reduce monthly benefits.”
Positions Against These Alerts Want to Chill the Discussion
However, other experts doubt that the federal government will be able to implement this change without facing significant rejection. “It’s not happening, as necessary as it is to maintain the Social Security program long-term,” said Alex Beene, a financial literacy instructor at the University of Tennessee at Martin. “We have seen riots in France and other countries in recent years with an age-related increase in Social Security-like benefits that was much lower than the jump to 73 proposed in the United States.”
Beene added that the public would probably react with anger and violence if the retirement age were to rise significantly after so many years, and that changes to Social Security will need to be gradual. “Even raising the age by one year could cause panic, so the strategy and implementation should be well-thought-out, explained and issued in a way that taxpayers don’t feel they are being cheated and robbed of the benefits they have been paying for years,” Beene explained.
The Risk for Future Retirees: More Working Years
For Americans who perform physical jobs until an old age, the change in retirement age could cause serious problems, as their bodies are not able to keep up with work, or lead to worse health outcomes. “I think gradually raising the retirement age is a possible solution, but it’s nowhere near 73,” opined Michael Ryan, a finance expert and founder of michaelryanmoney.com.
“A more likely scenario is a gradual increase up to the age of 69 or 70 over several decades, combined with other measures such as adjusting the payroll tax limit.”
Historical increases in the retirement age in the United States
The retirement age in the United States has undergone several significant changes over the years. In 1935, when Social Security was first implemented, the retirement age was set at 65. It was not until the 1980s that this age began to change.
In 1983, Congress passed a series of Social Security reforms that included a gradual increase in the full retirement age. These reforms established that, for people born in 1938 and later, the full retirement age would be increased from 65 to 67 years in a staggered manner.
For example, for those born between 1943 and 1954, the full retirement age is 66 years. For those born in 1960 and after, the full retirement age is 67.
