Sen. Chuck Hagel, R-Neb., has introduced a bill that would raise the retirement age for full Social Security benefits to 68, from 67.[@@]
The bill also would reduce benefits for workers who retire early, would add life expectancy to the calculations used to determine an individual’s base benefit, and allow room for a private account option.
Hagel filed the bill in an effort to break the political logjam over the long-term solvency of the system.
Hagel says the personal-account provision of his bill would offers Americans 44 and younger 2 options: Younger workers could invest 4% of their payroll taxes in a personal investment account modeled on the same accounts now offered to federal government employees (the remainder of their payroll tax contribution would continue to go into the traditional Social Security system); or younger workers could continue to invest their entire payroll tax in the traditional Social Security system.
If younger workers chose the personal account option, then those workers would be able to invest in the same 5 funds that collectively make up the current federal Thrift Savings Plan.