The Erroneous Selection of the Full Social Security Age as the Terminal Date for Lost Earnings Projections

2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Patrick A. Gaughan ◽  
Charles L. Baum
Keyword(s):  
Social Security ◽  
Personal Injury ◽  
Retirement Age ◽  
Social Security Benefit ◽  
Social Security Benefits ◽  
Selection Of

Abstract It seems to be increasingly common that some personal injury lost earnings projections are being extended by some experts to the “Normal Retirement Age” (NRA) – the age where workers can receive full, unreduced Social Security benefits. The selection of this age often implies a rejection of the worklife expectancy. However, statistics on claiming behavior of Social Security benefit recipients show that only a minority of recipients wait until the NRA to claim benefits. We use actual claiming behavior and the respective ages to show the use of the NRA for determining the ending date of lost earnings projections, instead of the well-researched worklife expectancy, results in exaggerated and speculative lost earnings damages.

What is the optimal age for withdrawing Social Security Benefits? Full Retirement Age, Late Withdrawal Age of 70, or Early Withdrawal Age of 62

2021 ◽  
Vol 8 (12) ◽  
pp. 175-192
Author(s):  
Anurag Pant ◽  
Raj K. Kohli
Keyword(s):  
Social Security ◽  
Family Income ◽  
Retirement Age ◽  
Single Family ◽  
Marginal Tax Rate ◽  
Family Responsibilities ◽  
Tax Rate ◽  
Early Withdrawal ◽  
The Individual ◽  
Social Security Benefits

When to retire is an individual decision based on many criteria like health of the individual, family responsibilities, expected life of the individual, single family income or dual family income, and other such considerations. A financial consideration can also be made. Retiring early will imply a reduction in social security benefits for the rest of your life. Retiring later than your full retirement age can mean a significant bump in benefits for the rest of your life. This paper simulates different conditions to estimate how long a life one needs to live to recover from the reduction in benefits resulting from earlier retirements.  Specifically, we model four permutations of the time value of money and the marginal tax rate on early benefits. Our results show there are significant advantages of withdrawing early benefits in most cases where life expectancy is shorter. But when expected life terms are much higher above 83, delaying retirement can significantly enhance the payout of benefits.

Comparing Social Policies: Some Problems of Method and the Case of Social Security Benefits in Australia, Britain and the USA

1988 ◽  
Vol 17 (3) ◽  
pp. 267-288 ◽  
Author(s):  
Helen Bolderson
Keyword(s):  
Social Policy ◽  
Social Security ◽  
Comparative Study ◽  
Social Security Benefit ◽  
Mixed Economy ◽  
State Sector ◽  
Evaluative Criteria ◽  
The Usa ◽  
Social Security Benefits ◽  
Cross National

ABSTRACTThe cross-national works of development sociologists and of political scientists have sought to disentangle some of the determinants of welfare, whereas studies in comparative social policy have been mainly evaluative. These have laid themselves open to charges of being, variously, a-theoretical, unsystematic and narrowly focused on the state sector. However, a case is made here for the continuation of such studies with a clear focus on social policy rather than the mixed economy of welfare, using more explicit evaluative criteria and a range of methods. A small comparative study of social security benefit levels in Australia, Britain and the USA is used as an illustration of the potential in this approach and the problems of method involved.

In Debt and Approaching Retirement: Claim Social Security or Work Longer?

2018 ◽  
Vol 108 ◽  
pp. 401-406 ◽  
Author(s):  
Barbara A. Butrica ◽  
Nadia S. Karamcheva
Keyword(s):  
Older Adults ◽  
Social Security ◽  
Labor Force ◽  
Social Security Benefit ◽  
Older Americans ◽  
The Past ◽  
Using Data ◽  
Social Security Benefits ◽  
To Receive ◽  
Retirement Study

Over the past couple of decades, older Americans have become considerably more leveraged. This paper considers whether household debt affects the timing of retirement and Social Security benefit claiming. Using data from the Health and Retirement Study, we find that older adults with debt are more likely to work and less likely to receive Social Security benefits than those who are debt-free. Indebted adults are also more likely to delay fully retiring from the labor force and claiming their benefits. Among the sources of debt, mortgages have a stronger impact on older adults' behavior than do other sources of debt.

scholarly journals THE ENDOGENOUS DETERMINATION OF RETIREMENT AGE AND SOCIAL SECURITY BENEFITS

2012 ◽  
Vol 18 (1) ◽  
pp. 93-113 ◽  
Author(s):  
Francisco Cabo ◽  
Ana García-González
Keyword(s):  
Social Security ◽  
Public Debt ◽  
Nonlinear Dependence ◽  
Retirement Age ◽  
The Public ◽  
Long Run ◽  
The Government ◽  
Pension Benefits ◽  
Social Security Benefits

An aging population in modern societies has put stress on public pension systems. To prevent social security deficits from increasing to unbounded levels of public debt we focus on two policies: reducing the generosity of pension benefits, determined by the government, and postponing the effective retirement age, chosen by employees. An atomistic employee would disregard the effect of his retirement decision on the public debt and would retire as soon as possible. Conversely, an ideal farsighted agency considering all current and future employees would postpone retirement, thereby alleviating the pressure on public debt and allowing a more generous long-run pension. The government may design a proper incentive strategy to induce myopic atomistic decision makers to act nonmyopically. This strategy is a two-part incentive with nonlinear dependence on the stock of public debt. It is credible if deceiving employees slightly adjust their retirement-age decisions to increments in the public debt.

scholarly journals How Long Should An Individual At Full Retirement Age Delay Receiving Social Security Benefits?

2012 ◽  
Vol 28 (3) ◽  
pp. 303
Author(s):  
Fred Hebein
Keyword(s):  
Social Security ◽  
Life Span ◽  
Discount Rate ◽  
Negative Impact ◽  
High Income ◽  
Retirement Age ◽  
Discount Rates ◽  
Short Delay ◽  
The Future ◽  
Social Security Benefits

n important topic for many individuals approaching 66 in 2011 is whether to start social security benefits at full retirement age (FRA) or to delay the benefits in order to gain greater payouts in the future. In 2009, the bonus for delaying the start of benefits rose to about 8% per year. By delaying benefits for four years (to age 70), it is possible to increase benefits by 38 to 55 percent per month for the remainder of the retirees life. In addition to the higher monthly benefits from delaying start of benefits, there are also substantial benefits for high income retirees in relocating to lower tax states. Also, given that the remaining age to death for most retirees at FRA is clearly finite, one would expect to see some value in discounting future earnings. Our paper evaluates accumulated benefits over a 25 year time horizon to assess retirement decisions post FRA. We consider three examples of accumulated benefits: (1) constant dollar accumulated benefits without discount or taxes; (2) alternative rates of discount of the future stream of earnings without income taxes; and (3) discounted after tax benefits. Each scenario is evaluated to assess whether delaying social security benefits past FRA is a profitable idea. Based upon our analysis, any discount rate in excess of 5% of the available after-tax returns provides no breakeven age within expected life ages. That is, at high discount rates, it is always better to start benefits at FRA or with only short delay once FRA is reached, if the individual wishes to maximize accumulated benefits over the expected life. At discount rates of less than 3%, the accumulated benefits may be increased within the expected life span by delaying the start of benefits. If no discount rate is applied, accumulated benefits are maximized by delayed start since all breakeven ages occur within life expectancy. In addition, we find that the negative impact of taxes on accumulated benefits can be as large as a discount rate of 3% on accumulated benefits. For high income retirees, a strategy of (1) relocating to lower tax states and (2) delaying the start of benefits can provide substantial increases to accumulated benefits. Finally, we note that the retirement decision is not entirely financial, but that many factors including family, spouse, work climate, health, expected life span, and fear of running out of money lead individuals into making decisions that may not optimize the present value of future benefits.

Bezpieczeństwo socjalne imigrantów w Polsce na przykładzie miasta Gdańska

2018 ◽  
Vol 16 (16) ◽  
pp. 165-183
Author(s):  
Joanna Rosłon-Żmuda
Keyword(s):  
Social Security ◽  
Financial Support ◽  
European Countries ◽  
Good Chance ◽  
Social Security Benefit ◽  
International Protection ◽  
The Republic ◽  
Polish Law ◽  
Social Security Benefits ◽  
To Receive

According to Polish law, immigrants seeking international protection in Poland are eligible to receive social help either at immigrants centers or outside, in the forms of social security benefits for covering costs of staying in the Republic of Poland. The amount of social security benefit in Poland is relatively low, therefore many immigrants seek a better place for themselves in wealthier European countries. Proposed by Gdańsk authorities modal solutions concerning social help for immigrants are based on integration and assimilation processes which are worth noting. Model of Immigrants Integration with the verbal and financial support offered by governmental administration have a good chance of bringing multiple benefits both for the Polish community as well as the Polish industry.

How the COVID-19 pandemic could reduce near-retirees' Social Security benefits

2020 ◽  
Vol 20 (1) ◽  
pp. 1-8
Author(s):  
Andrew G. Biggs
Keyword(s):  
Social Security ◽  
Disability Insurance ◽  
Economic Downturn ◽  
Social Security Benefit ◽  
Social Security Administration ◽  
Retirement Benefits ◽  
Middle Income ◽  
The Social ◽  
Social Security Disability ◽  
Social Security Benefits

AbstractA quirk in the Social Security benefit formula interacting with the sharp economic downturn due to the COVID-19 pandemic could cause certain groups of near-retirees to suffer significant and permanent reductions to their Social Security retirement benefits. A sudden decline in the Social Security Administration (SSA)'s measure of economywide average wages in the year a worker turns 60 causes the Social Security benefit formula to devalue all the worker's earnings prior to age 60, resulting in a lower measure of career-average earnings and a lower benefit in retirement. A middle-income worker aged 60 in 2020 could receive an annual Social Security benefit reduction of around 9%, with losses through retirement approaching $46,000. Individuals becoming eligible for Social Security Disability Insurance benefits would be subject to similar reductions in percentage terms. Several methods are discussed to reduce or eliminate the likelihood of similar benefit ‘notches’ occurring in the future.

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