The consequences of claiming Social Security benefits at age 62

Delaying claiming of Social Security old-age benefits past the earliest eligibility age, age 62, raises the monthly benefit for a person's life. Despite arguments from both proponents and opponents of delayed claiming in academia and public discourse, little is known about whether claiming decisions lead to substantively different outcomes. We compare differences in outcomes between age-62 claimants and otherwise similar later claimants that are matched on health, employment, and financial characteristics at age 60. We find that age-62 claimers are substantially less likely to work after 62 and have persistently lower income into their 70s. Differences in assets emerged in the 70s, with early claimants having lower wealth, but we find no differences in mortality or self-reported financial hardship. The difference in wealth is driven primarily by a growth in wealth among later claimants rather than substantial decumulation by age-62 claimants.

Age and Support for Public Debt Reduction

Many scholars and policymakers see the continuing rise of debt burdens in the advanced industrialized world as the product of aging populations and increasing dependency ratios. In fact, many prominent theoretical models of government debt accumulation -- often used to justify fiscal rules and austerity measures -- make explicit assumptions that individuals will have different preferences for debt reduction as they age. While such models have been influential, the fundamental assumption regarding the relationship between age and preferences for growing debt has not been test empirically. Using a decade's worth of data from the Eurobarometer survey across 33 countries, we find that age has a modest, non-linear impact on concern for national debt burdens. In general, the middle-aged show the most concern for debt reduction, while the young and the old are less likely to view reducing government debt as a policy priority. Notably, the relationship is strongest in countries with more generous old-age benefits.

The Expectation for Risk-Sharing Cycle: Theoretical Model and Global Implementation

In this paper, we offer an explanation to pension systems cyclical reforms, based on Central East Europe (CEE) countries experience over the last three decades. We claim that in the transition to funded pension design, the government not only transfers longevity and fiscal risks to the individualbut also absorbs risks transferred from the public, where each market actor transfers undiversifiable risks to the other. This hidden risk path that has not been discussed yet in the literature, stemmed from the public expectation to risk premium or adequate old age benefits that evolves to political pressure. The outcomes of this risk path realized in financial transfers, such as social security, means-tested and minimum pension guarantee. Consequently, funded pension designs naturally converge to a new landscape paradigm of risk sharing, including intergenerational and intra-generational play. Financial crises such as the recent COVID-19 pandemic foster the convergence process.