October 19, 2010
If you asked people what the retirement age is for Social Security most people would probably say 66, or perhaps age 65 if they missed the fact that the age for full benefits has been increased. However, workers can qualify for early benefits at age 62 and most workers do in fact start collecting benefits shortly after reaching this age.
This is why it is very disturbing to see the NYT and other reports on France routinely refer to President Sarkozy’s plan to raise the retirement age in France from age 60 to 62. This refers to the early retirement age. The normal retirement age is already age 65 and would rise to age 67 under Sarkozy’s proposal.
In the same vein, the article refers to a plan by Germany to raise its retirement age to 63 without noting that this refers to the early retirement age. The age for full benefits in Germany is currently 67.
The article also points out projections for declining ratios of workers to retirees, which will put pressure on retirement systems. It would have been helpful to point out that real wages are projected to increase at the rate of approximately 1 percent annually. This would allow workers to spend a larger portion of their life in retirement if they opt to take a portion of this gain in longer retirements with somewhat smaller pay gains.
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