The growing proportion of Americans over the age of 65 could have dramatic long-term financial consequences on the nation, putting safety-net programs on an unsustainable course, a new report suggests.
The ratio of adults over 65, compared with people aged 20 to 64, will increase by 80% in the coming decades, due partly to improved life expectancy. However, according to the report Aging and the Macroeconomy: Long-Term Implications of an Older Population, one-fifth to two-thirds of seniors have not saved enough money for retirement.
Report authors recommend pushing retirement age beyond the currently accepted age of 65 years, encouraging people still in the workforce to save more earlier on and dampen spending. They also advocate asking people over 65 to continue paying taxes.
“We strongly believe that our nation needs to act sooner rather than later. The problem is not going to go away and it only gets tougher the longer we delay. The longer we wait, the larger the adjustments we will need to make,” report co-author, Ronald Lee, Ph.D., said in a news conference. Lee is a professor of demography and economics at the University of California, Berkeley.
The report, which was published by the National Research Council, was sponsored by the U.S. Department of Treasury, with additional funding from the National Institute on Aging.
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