The Philadelphia Inquirer writes on Wharton Prof. Olivia Mitchell’s idea to encourage longer work lives by paying retirees a lump sum Social Security bonus check. Under current law, anyone who delays claiming Social Security benefits past age 62 receives a higher benefit, of about 7% per year they choose to delay. Under Mitchell’s proposal, workers who delayed retirement could instead opt to receive their extra lifetime benefits as a one-time, lump sum payment. If people prefer lump sums to income streams – and there is reason to believe that they do – then this approach could encourage longer work lives.
This idea is getting a lot of publicity, so read all about it here.