Washington, D.C. — As the debate around Social Security continues on Capitol Hill and evidence of the widening gap in life expectancy between the richest and poorest Americans continues to mount, the Center for American Progress urges that now is the time to expand and strengthen Social Security, not cut it. Not only would raising the retirement age reduce benefits for all future beneficiaries, lower-income workers would bear the brunt of these cuts. A new CAP column highlights how the growing life expectancy gap is shrinking lifetime Social Security benefits for lower-income workers.
“Conservative calls to raise the retirement age are wildly out of step with growing evidence that life expectancy is increasingly based on income,” said Rebecca Vallas, Managing Director for the Poverty to Prosperity Program at CAP. “Raising the retirement age would be a needless blow to low-income workers’ economic security in old age.”
The widening life expectancy gap in the United States has significant consequences when it comes to Social Security. Since the wealthiest tend to live longer, lower-income earners, on average, receive much less in Social Security benefits over their lifetimes. Raising the retirement age—to 70 years, for example, as some conservatives have proposed—would shorten the total period over which workers—particularly lower-income workers—can access the benefits they have earned. And raising the early retirement age from 62 would move critical retirement benefits out of reach for older workers who need to retire in their early 60s for health, family, or economic reasons.
As inequality has risen and economic mobility has fallen, being born in poverty increasingly means being stuck in poverty, robbing Americans of years—or even more than a decade—of life. Because of this, Social Security will play an even more significant role for future generations who seek even modest financial security in retirement. However, lower-income Americans are already the least likely to be economically prepared for retirement: Only 8 percent of those in the bottom one-fifth of the family income distribution ages 32 to 61 have any retirement savings at all, compared with 88 percent among the top one-fifth.
It is time to expand and strengthen Social Security to protect Americans from falling into poverty in old age—not push them deeper financial instability by eroding their already meager benefits.
Read the full column, “Yet Another Reason Raising the Social Security Retirement Age Is a Terrible Idea” by Rebecca Vallas, Jackie Odum, and Rachel West, online here.
For more information on this topic or to speak with an expert, contact Liz Bartolomeo at firstname.lastname@example.org or 202.481.8151.