Thursday, May 1, 2008

Retirement : The Old Folks Dilemma (Task 5)

Nobody live forever. Human will grow from a baby to an old hag as the time flow. That works for jobs too, since they only need a productive human, which mean a man or woman who still creative and do their job effectively, around age 25 till 70. However, the boundary of working age is the thing that we call retirement.

Retirement is something that we should plan carefully. The government may bring up the law that say we can’t working after we past age 65 or 70. This could be right, since their point of view is about health and life expectancies. However, the old age means more experiences and skills than the young. A profession like politician or other that used mind than physical strength like athlete should retire longer, because their knowledge is needed for their work. In the other hand, profession that need physical strength like athletes should retire at 30 or 35, since their body may suffer because of their work if they still working past that age. However, the retirement rules don’t apply to profession like entrepreneur, since they gain money by working for themselves.

Then here are the dilemma. If we decide to retire early, the full retirement benefits will be lower than the one if we retire at the max retirement age. For example, in America, anyone born in 1960 or later who retires at 62 will have to accept a 30% cut in their normal benefit vs. the 20% cut absorbed by 62-year-olds whose normal retirement age was 65. That's nearly $500 less a month on a full $1,660 benefit -- the amount paid to people who were levied the maximum Social Security tax and are just now retiring at age 65. That's "the same thing as reducing benefits” (Gale 2002). However, some companies may asked for early retirement, since they hoped to replace them with younger, which paid lower.

In the end, I think we should retire at the maximum retirement age that our country applied, since we get more benefits, like higher pension money and life insurances than the early retirement. Consider that we don’t know when we died, maybe we’ll live till 100 or die after we retire, we must take the most profitable one. However, it’s your choice to decide, to take the early retirement with lower benefits but more time to enjoy your old age, or late retirement with higher benefits but may make you works longer.

References :

Lim,P.J. (2007, February 9). Portfolio Strategies for a Shaky Market. [Online article]. Retrieved May 1, 2008 from the World Wide Web:

Stone, Amey (2002, July 29). Retire at 65? Better Change Your Plans. [Online article]. Retrieved April 12, 2008 from the World Wide Web: