Lawmaker Offers Social Security Compromise

The bill would maintain the current early retirement age of 62. However, those who took early retirement would have their benefits adjusted. Currently, workers who retire early receive 70% of their full retirement benefits. under the bill proposed by Hagel, those benefits would drop to 63%.

Regarding the third component, Hagel says by factoring increased life expectancy to the calculations for the base Social Security benefit, the rate of increase in benefit payments would be slowed. “No other changes will be made to the annual consumer price indexing of benefit increases,” he says.

Currently, and individual’s base Social Security benefit is determined by their average income over 35 years and the wage index.

“In addition to making Social Security solvent, these adjustments can help us confront the challenges of increasing Medicare costs and shortages in the work force,” Hagel says. “It is important to protect the option of early retirement, but our laws need to encourage individuals to stay in the work force, not leave it. Medicare costs, Medicaid costs and labor shortages can be significantly reduced by keeping people healthy and productive and in the work force.”