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Projecting the Effects of Retirement Age Increases and Mortality Adjustments

March 2021

Raising the full retirement age (FRA) alone would reduce Social Security retirement benefits across-the-board relative to current law

However, the effects of these benefit reductions would vary because of differences in individuals' reliance on Social Security for retirement income, among other factors.

Applying a cohort-based mortality adjustment designed to offset increasing differential mortality would increase lifetime benefits and lower poverty rates for some groups compared to solely raising the FRA

For example, because of the positive relationship between mortality and lifetime earnings, Social Security benefits would increase for individuals with low lifetime earnings and decrease for those with higher lifetime earnings.

Projected Changes in Lifetime Benefits and Poverty Among Beneficiaries Aged 60 or Older Under Two Hypothetical Policy Options Compared to Scheduled Benefits in 2030, by Characteristic
Characteristic Median lifetime benefits (percentage change) Poverty rate (percentage point change)
Increase FRA to 69 Increase FRA to 69 with mortality adjustment Increase FRA to 69 Increase FRA to 69 with mortality adjustment
Total −14 −18 1.6 0.6
Women −13 −18 1.6 0.9
Men −15 −20 1.5 0.1
Shared lifetime earnings quintile  
Highest −14 −25 0.1 0.1
Middle −14 −18 0.7 0.7
Lowest −12 −1 4.9 −0.2
Bachelor's degree or higher −14 −21 0.8 0.5
High school graduate −13 −16 1.8 0.7
Less than 12 years −13 −6 3.1 −0.5
  • In response to overall life expectancy increases, many Social Security proposals have recommended FRA increases.
  • Research has shown greater longevity gains for individuals with higher education and income levels.
  • FRA increases would affect monthly and lifetime Social Security retirement benefits in complex ways given increasing differential mortality.
  • We projected the distributional effects of hypothetical FRA increases with and without mortality adjustments.
  • Full retirement age (FRA) is the age at which a person becomes eligible for unreduced Social Security retirement benefits; FRA varies from 65 to 67 depending on the workers' years of birth.
  • Differential mortality refers to differences in death rates across demographic groups.

SOURCE: Adapted from Tables 4 and 5 from Reznik, Gayle L., Kenneth A. Couch, Christopher R. Tamborini, and Howard M. Iams. 2019. “Longevity-Related Options for Social Security: A Microsimulation Approach to Retirement Age and Mortality Adjustments.” Journal of Policy Analysis and Management, 38(1): 210–238.

NOTES: Projections were made using SSA's Modeling Income in the Near Term, Version 7 (MINT7) and exclude disabled beneficiaries and nonbeneficiaries.

All content is simplified for presentation. Please see source material for full details and caveats.

The findings and conclusions presented in this summary are those of the authors, are not arguments for or against any of the policy options examined, and do not necessarily represent the views of the agency.