• Discounts and special offers
  • Subscriber-only articles and interviews
  • Breaking news and trending topics

Already a subscriber?

By signing up, you accept Moneywise's Terms of Use, Subscription Agreement, and Privacy Policy.

Not interested ?

Why China made the changes

China’s elderly population is surging, reflecting longer life expectancies in many nations likely brought on by higher standards of living and healthcare advances. But China’s birth rate is falling, partly due to the one-child policy that was in effect from 1979 to 2015 – an imbalance that means fewer young people are entering the workforce to support an aging populace. China’s working-age population (ages 15-59) has been decreasing as a share of the total number of people in the country, straining economic growth and putting pressure on the nation’s pension system.

The BBC reported that Chinese residents expressed their discontent online. "In the next 10 years, there will be another bill that will delay retirement until we are 80," a user wrote on social media site Weibo. “Are you asking me, when I’m 60, to compete with young people for jobs?” another Weibo user asked, per Bloomberg.

Invest in real estate without the headache of being a landlord

Imagine owning a portfolio of thousands of well-managed single family rentals or a collection of cutting-edge industrial warehouses. You can now gain access to a $1B portfolio of income-producing real estate assets designed to deliver long-term growth from the comforts of your couch.

The best part? You don’t have to be a millionaire and can start investing in minutes.

Learn More

Could this happen in America?

Long before China’s move, Social Security eligibility had become a reliable flashpoint in U.S. domestic and economic policy debates. The safety net program is projected to run out of sufficient funds by 2035, and without Congress making any changes, it will only be able to pay around 80% of retirees’ full benefits.

Raising the retirement age is one of several proposals to solve this issue, alongside cutting benefits for high earners and raising tax revenue. It would presumably help preserve Social Security funds by reducing the number of years people collect benefits.

But not all jobs are suitable for older workers, and extending working years could be harmful to some – especially for those in physically demanding roles. And because lower-income workers may rely more heavily on Social Security, raising the retirement age could disproportionately affect them.

Regardless of the arguments, raising the retirement age will be politically tricky, since any increase in the age requirement would likely raise the ire of workers.

Earlier this year, a large group of U.S. House Republicans known as the Republican Study Committee (RSC) proposed raising Social Security’s full retirement age to 69 in their fiscal year 2025 budget proposal. It suggested gradually increasing the retirement age for those not facing imminent retirement to reflect longer life expectancies and improve the programs’ financial sustainability. Virginia Rep. Ben Cline, the group's budget task force leader, told Roll Call those now aged 59 would see an increase in the retirement age of three months per year beginning in 2026. The retirement age would reach 69 for those who turn 62 in 2033.

According to Center for American Progress analysis, "a full retirement age of 69 would cut benefits for all new retirees between roughly 12.5% and 14.3% by the time it is fully phased in. In addition, it would cost a median-wage retiree who earned $70,000 in 2022 and turns 62 in 2034 thousands of dollars every year."

Regardless of politics, China’s decision highlights the complex challenges nations face as populations age and economic demands evolve. Still, there may be lessons for the U.S. – worker backlash in China could be instructive to American policymakers as they consider changes, and China’s gradual phase-in of the change offers a peek into how a change might take shape.

Sponsored

Save big on car insurance with this simple, money-saving tip

Tired of overpaying for car insurance? Find affordable rates without the hassle. Media Alpha's comparison tool makes it easy to discover hidden savings and unlock better deals in minutes. Don’t wait—start saving money on your car insurance today. Visit now

Christy Bieber Freelance Writer

Christy Bieber a freelance contributor to Moneywise, who has been writing professionally since 2008. She writes about everything related to money management and has been published by NY Post, Fox Business, USA Today, Forbes Advisor, Credible, Credit Karma, and more. She has a JD from UCLA School of Law and a BA in English Media and Communications from the University of Rochester.

Disclaimer

The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter. Advertisers are not responsible for the content of this site, including any editorials or reviews that may appear on this site. For complete and current information on any advertiser product, please visit their website.