Employee Benefits News
Several studies are showing that the average age for retirement has increased by three to four years, but why? Social Security may be one of the main contributing factors as the U.S. government raised the age to claim full benefits to 67. Those born after 1960, who try to claim their Social Security benefits before 67, will face a penalty. Additionally, the switch from pension plans and annuities to company sponsored 401(k) plans may have impacted the rise in retirement age. In 1940, nearly 58% of American households had a pension or annuity. By 1965, however, less than 5% did. Healthcare is another top contributor as employer-provided health plans for retirees has decreased, leaving individuals to purchase coverage from the marketplace, which can come with quite the price tag. On a more positive note, however, employees are generally healthier and are living longer, making them able to work for longer. So, will we see the retirement age continue to rise or we will revert back to our previous trends?