Raising the Retirement Age Eligibility to 70-Years-Old Would Be Yet Another Stab in the Back on Our Younger Generations

Make no mistake, a retirement income crisis will hit the U.S. as soon as more Gen X begins to reach retirement age.

Currently, there is still a relatively high contentment among Baby Boomers with regard to Medicare and Social Security, specifically with Medicare.

Why the glum prognosis? Medicare is actually insufficient to pay for the high costs of healthcare. But Baby Boomers are hardly complaining because they are the last generation that’s enjoying the benefit of their former employers in the private sector or government paying for much of Medicare’s out-of-pocket costs, premiums and prescription drugs. Many Baby Boomers are fortunate to have Rolls Royce retirement plans from their previous employers and if they’re healthy, they’re really not paying much.

But it’s important to point out also that there are Baby Boomers without these plush retirement plans and struggling financially to make ends meet because the cost of healthcare has been outpacing inflation and they’re actually paying for Medicare (which is not free, as people have this misconception about) and the out-of-pocket healthcare costs. This second group is growing but still a minority at the time.

But fast forward to when Gen X begins to retire, you will begin to see that a majority of retirees will be like this second group, retirees enrolled in Medicare and not having their former employers pay for everything, and thus, struggling to get by because Medicare is insufficient to pay for enrollees’ health needs.

Already less than half the private sector workforce participates in an employer-sponsored retirement plan. The private sector is increasingly abandoning retirement plans for their employees. And government – federal, state and counties – is struggling to maintain their employees’ retirement plans. As powerful as government unions are, they’re simply not able to deliver on the retirement benefits as Baby Boomers now enjoy.

On top of that, because the cost of healthcare outpaces inflation, Medicare will be even less able to pay an adequate share of healthcare come 10, 20 years.

Entire retirement income system
What are politicians doing now with regard to Medicare and Social Security? They’re playing catch up and narrowly thinking about these two programs as independent entities in the giant ecosystem of retirement.

They’re only looking at providing benefits and services for Medicare that meets the bare minimum of retirees’ needs and not looking at the entire retirement income system currently, and what’s to come in 10, 20 years.

Where will the money come from to pay for Social Security and Medicare as healthcare and inflation costs rise in 10 to 20 years? Will the government then, still be reactive and playing catch up?

Containing Medicare costs has always been linked to containing the cost of our overall healthcare system. But powerful interest groups in healthcare have essentially stopped any efforts that politicians might have to explore these possibilities.

But Medicare will always be insufficient (especially as employers move away from the responsibility of providing their workers retirement plans) to cover healthcare costs if the root of the problem is not addressed – containing our overall healthcare system costs.

The same problem exists with Social Security. We see income levels have been stagnant for decades and are not keeping pace with inflation. And what are politicians doing? They’re simply focusing on Social Security and ways to keep that program afloat without looking at big picture economics. Why? Because powerful interest groups are protecting their bottom line, their profit thresholds, and redirecting awareness, conveniently for their own benefit.

A reckoning is coming
It can be argued that Baby Boomers are enjoying the best years of Medicare and Social Security and the future is bleak for future generations unless we begin to look at our entire retirement income system relative to our entire healthcare system and our entire economic system.

Baby Boomers, while many (not all) are enjoying the full benefits of their employers’ retirement system and a Medicare program to pick up the slack (or vice versa), they should be less complacent and not wholly pushing for the status quo.

Look at the housing nightmare that Baby Boomers and early Gen Xers left for millennials and Gen Z – runaway housing prices, runaway rent prices that even professionals are having financial difficulty surviving in certain cities.

That same phenomenon is likely the future of retirement – that retirement will only be affordable to a few, like today’s housing market. And both Medicare and Social Security (like the so-called affordable housing initiatives) would be negligent to correct the situation because of a lack of foresight and preparedness.

We are already looking at the gross inequities in our retirement community as increasingly more in our population fall through the gaps of the nation’s security blanket (Medicare and Social Security). And the Baby Boomer haves are turning their backs on their generation’s have-nots, and unaware to think about what retirement will look like for future generations, just as they’ve done with the housing market.

The problem of today’s Medicare and Social Security is not meant to spark generational warfare. But when you look at the latest proposal by Republicans to raise the eligibility age of both these retirement programs to 70 years old (whether it would be immediate to affect Gen X or in the future to affect Millennials and after), you cannot help but to think that Baby Boomers are once again looking at their interests and ignoring the needs of future generations, as they’ve done with today’s housing crisis.

There’s endless rhetoric of caring for our children and future generations. We’ve failed Gen Z with housing affordability and climate change. Let us not pass the buck and fail Gen Z with Medicare and Social Security. It’s absolutely absurd to raise the retirement age to 70-years-old.

France was right to zealously protest a proposal to raise their eligibility retirement age from 62 to 64.

Comparatively, in the U.S. the complacency surrounding talks of raising that age to 70 is woefully astonishing.

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