In recent international news, France has increased its retirement age from 62 to 64, leading to protests throughout the country. This move is aimed at shoring up the long-term sustainability of their retirement programs. Similarly, in the United States, there are discussions around increasing the retirement age for programs like Social Security and Medicare in an effort to maintain their long-term viability.
It’s essential to build a long-term retirement strategy that includes accumulating money in your 401(k), 403(b), or other accounts, to last you through retirement and “bridge any gaps” between retirement and social programs. As you get closer to retirement, it’s important to model out your different options with respect to social security and healthcare costs. Planning for these two major components of retirement can ensure that your retirement income strategy is on track to allow your money to last as long as you live.
Although there’s nothing imminent concerning retirement age in the United States, it’s crucial to keep an eye on any potential changes that could impact your retirement plans. Find out more on this in a new Money Hacks episode and plan accordingly to ensure your retirement is on track.
Any money questions you’d like answered? Our Money Hacks series is created from conversations we have with employees, investors, savers, and all people planning for their financial futures. What topics are on your mind for our next episode?
Video Transcript:
Hey, this is Alex and it’s episode 103 of Money Hacks. In some recent international news, France has signed into law an increase in their retirement age, sacré bleu! Oh my gosh! People are upset about this protest happening throughout the country in Paris. They’ve increased the age from 62 up to 64, as the country’s retirement age.
This is something that, you know, we’re, we’re hearing thoughts and, and ideas around here in, the United States as well as a way to shore up some of the different federal benefits that we’re all paying into and getting access to like Social Security and Medicare with current retirement ages at 67 for full social security benefits and 65, respectfully for Medicare.
I think as we meet one-on-one with investors, with those who are getting close to retirement, it’s something really important, to think about when it comes to your overall financial and retirement picture. Especially folks who are thinking about retiring a little bit earlier, maybe closer to 62 or 65 before full social security kicks in.
I do think that in an effort to maintain the long-term sustainability of these programs like Social Security in particular, it’s likely that at some point down the road, younger generations, perhaps my generation and younger, will have a normal retirement age for purposes of getting social security. That might be 69, 70, 71, or older.
And so as we’re thinking about saving for retirement, really ensuring that we’re building out a long-term strategy. We’re accumulating money in our 401k, 403b, or other accounts, to last us into as we start into retirement, through our retirement, but also to bridge that period. Because if you take social security early for those who, know you, you can take Social Security as early as 62, but there’s a permanent reduction in that benefit sometimes as much as a 30% permanent reduction, and the value of the benefit by taking it early, which can make a big difference in having enough money to maintain your lifestyle through your retirement or falling short. So, something to keep an eye on.
There’s certainly nothing, imminent with respect to retirement age here in the US but as you get closer to retirement, modeling out your different options with respect to social security and also modeling out your healthcare and medical coverage and costs in retirement are two huge pieces to your, retirement plan, your retirement income strategy, and ensure you’re on track, to allow your money to last for as long as you live. So, keep an eye on this, and come back here for more information and news. Look forward to seeing you soon.
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