HETEROGENEOUS EFFECTS OF RAISING SOCIAL SECURITY ENTITLEMENT AGE ON OLDER ADULTS

One policy proposal at the center of discussions on how to address America’s aging population and the corresponding threats to the solvency of the Social Security Trust fund is a policy aimed at increasing the age of eligibility for Old Age and Survivors Insurance (OASI) benefits. This change would impact older adults’ well being by reducing their lifetime OASI and disability insurance (DI) benefits and delaying their retirement decision, which would expand their private savings. In addition, social security policy change would influence aged adults’ private financial transfer such as bequest and inter vivos gifts, and their non-market productive activities including volunteer and care provided to family members. Specifically, individuals vary by health and socioeconomic status (SES) may respond differently to the policy change. Consequently the policy effects can be heterogeneous.