Saving for retirement may be low priority for most new workers. But, the younger generation, experts say, should start saving now and put away more, because their government benefits likely will be less than their older cohorts.
Reducing benefits is one suggested fix to Social Security, which expects a deficit in 2018, when it will pay out more benefits than it collects in payroll taxes. According to a recent AARP poll, the fixes most favorable to people 50 and older include increasing the payroll tax by 0.5 percent and increasing the wage cap on payroll taxes to $150,000. Most don’t favor raising the age of full benefit to 70.
According to the Bureau of Labor Statistics, people already are working longer. Of those 65 and older, 51 percent worked in 2005, up from 36 percent in 1990.
Retirees can cut their retirement income needs in half, just by working from age 63 to 65, said John Rother, director of policy and security for AARP.
Longer life spans, combined with fewer births, is putting a strain on government pension programs worldwide, said Rudolph Penner, senior fellow with the Urban Institute.
A big problem with the U.