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Congress plans to raise the retirement age to 67

Work/retirement crossroads sign.

TEXT OF STORY

STEVE CHIOTAKIS: A whole lot of ideas are coming out of President Obama's budget deficit commission. So far, what the panel's discussing is considered a starting point, with a December 1st deadline to submit a final plan to Congress.

But Marketplace's Alisa Roth reports, there's no number in the document as important as the retirement age.


ALISA ROTH: Right now, the retirement age is 66. Congress already decided to raise it to 67. And if this proposal passes, it would eventually go up to 69.

Andrew Biggs is a former Social Security official. He says raising the retirement age would keep people in the workforce longer. Which would be helpful

ANDREW BIGGS: Raising the early retirement age has a very small effect on Social Security's effect but a pretty large effect on the Federal budget as a whole because people continue to work for a few extra years.

So not only are they waiting longer to draw their benefits. But they're earning more, they're generating more taxes, and they're saving more for retirement. The new proposal would have a special exemption for people who physically can't work past 62, which is the current early retirement age. None of this is going to happen very soon though. The retirement age wouldn't hit 69 until 2075. Meaning the first people who need to plan for that won't start kindergarten until next year.

I'm Alisa Roth for Marketplace.

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