New Seniors

Congressman, Dennis Kucinich (D-OH) recently announced he will introduce a bill designed to create a million jobs for unemployed workers by allowing people who have reached 60 to take early retirement.  The question is, how can adding to the growing roles of those on Social Security and other government-run/taxpayer-funded programs possibly be good for the nation’s financial woes?

“Many older workers can’t wait to retire, while many younger workers desperately need work.  My plan enables older workers to take early retirement, thereby freeing up those jobs for younger workers who are currently unemployed.  If just 25% of eligible workers choose to retire early, we can very quickly open one million job opportunities.  These are not temporary jobs, but permanent jobs that already exist in our economy, even under the current recessionary circumstances,” said Kucinich.

To many, this might seem like a sound idea, since more than two-thirds of workers elect to take early retirement based on Social Security (SS) rules offering reduced benefits at age 62.  The Congressman’s plan would reduce the eligibility age to 60 for the first million (25% of those eligible) who are willing to retire, now.  The money would come from the funds already allocated for job stimulus and health insurance would be covered by a different federal spending act.  This is still the taxpayers’ money.  Right?

The broad concern about such a move is that it does not create new jobs; instead this simply replaces one worker with another.   In essence it takes a productive, experienced worker and replaces them with one that is younger but untrained.  Of course, the argument may be that the newer one will do the job for less money and fewer benefits.

Public sector employees may welcome early retirement, since they usually receive better benefits after leaving the workforce than do those from the private sector.  Unfortunately, taxpayers are saddle with these retirement benefits (up to a whopping 90% of what they got while on the job) for the rest of the employee’s life.  And if they so choose, the employee is young enough at age 60 to find another job, with the net result to them being more income than before.  This also means taking a job that might have been filled by someone who is already unemployed.  Does this make sense?

Pre-boomers know what its like to plan for retirement and many of us have made the transition.  We know it’s not as easy as those who have yet to go through the process think it is.  The prospects of living another 25 or more years is worrisome when our fixed incomes are affected by the financial market volatility and out-of-control government spending.  On top of this we are faced with a freeze on SS benefit increases and a $500 billion decrease in the Medicare budget.

The 65+ market is about to experience a population explosion as boomers become New Seniors next year.  Before fixing anything else, well-meaning politicians need to talk to those of us living in retirement before trying to add more people to our roles.

Don Potter: Editor-in-Chief

Don Potter, a veteran of the ad agency business, is a Philadelphia native currently living in Los Angeles. He is the author of an acclaimed marketing book, The 50+ Boomer: Your Key to 76 Million Consumers. In retirement, Potter has written two novels, hundreds of articles and is a frequent lecturer. A leading advocate for those 65+, he is a founder of NewSeniors.com.

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