Barbara A. Butrica () (Urban Institute) Richard W. Johnson () (Urban Institute) Karen E. Smith () (Urban Institute) Eugene Steuerle () (Urban Institute)
Abstract
Encouraging work at older ages is a critical policy goal for an aging society, but many features of the current system of benefits and taxes provide strong work disincentives. The implicit tax rate on work increases rapidly at older ages, approaching 50 percent for some workers by age 70. In addition, by age 65 people can typically receive nearly as much in retirement as they can by working. If older Americans could overcome these barriers and delay retirement, they could substantially improve their economic well-being at older ages. For example, many people could increase their annual consumption at older ages by more than 25 percent by simply retiring at age 67 instead of age 62.
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Find related papers by JEL classification: J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Coile, C. & Diamond, P. & Gruber, J. & Jousten, A., 2000.
"Delays in Claiming Social Security Benefits,"
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Jagadeesh Gokhale & Laurence J. Kotlikoff & Alexi Sluchynsky, 2002.
"Does it pay to work?,"
Working Paper
0206, Federal Reserve Bank of Cleveland.
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