The Potential Effects of Obesity on Social Security Claiming Behavior and Retirement Benefits.

Objectives: Obesity prevalence among Americans has increased for nearly three decades. We explore the relationship between the rise in obesity and Social Security retirement benefit claiming, a decision impacting nearly all aging Americans. Specifically, we investigate whether obesity can affect individuals' decision to claim benefits early, a choice that has important implications for financial security in retirement, particularly for those with lower socioeconomic status (SES). Method: We use a microsimulation model called MINT6 (Modeling Income in the Near Term, version 6) to demonstrate the potential effects of obesity on subjective life expectancy and claiming behavior. We impute obesity status using data from the National Health and Nutrition Examination Survey (NHANES), which describes the distribution of obesity prevalence within the United States by gender, poverty status, and race/ethnicity. Results: We find that the rise in obesity and the consequent incidence of obesity-related diseases may lead some individuals to make claiming decisions that lead to lower monthly and lifetime Social Security retirement benefits. Further, we find that the potential economic impact of this decision is larger for those with lower SES. Discussion: We present a behavioral perspective by addressing the potential effects that obesity can have on individuals' retirement decisions and their resulting Social Security retirement benefits.

A profile of social security child beneficiaries and their families: sociodemographic and economic characteristics.

Using a rich dataset that links the Census Bureau's Survey of Income and Program Participation calendar-year 2004 file with Social Security benefit records, this article provides a portrait of the sociodemographic and economic characteristics of Social Security child beneficiaries. We find that the incidence ofbenefit receipt in the child population differs substantially across individual and family-level characteristics. Average benefit amounts also vary across subgroups and benefit types. The findings provide a better understanding of the importance of Social Security to families with beneficiary children. Social Security is a major source of family income for many child beneficiaries, particularly among those with low income or family heads with lower education and labor earnings.

Coping with the demographic challenge: fewer children and living longer.

Due to demographic changes, the U.S. Social Security system will face financial challenges in the near future. Declining fertility rates and increasing life expectancies are causing the U.S. population to age. Today 12 percent of the total population is aged 65 or older, but by 2080, it will be 23 percent. At the same time, the working-age population is shrinking from 60 percent today to a projected 54 percent in 2080. Consequently, the Social Security system is experiencing a declining worker-to-beneficiary ratio, which will fall from 3.3 in 2005 to 2.1 in 2040 (the year in which the Social Security trust fund is projected to be exhausted). This presents a significant challenge to policymakers. One policy option that could help keep the Social Security system solvent is to reduce retirement benefits, either by raising the normal retirement age or through life expectancy indexing, to reflect the fact that people are living longer. However, these reductions in benefits have the potential to harm economically vulnerable retirees. Other options, such as progressive price indexing proposals, explicitly protect the retirement benefits of low lifetime earners. Still other options would seek to raise additional revenue for the system. Since individuals will be living longer in retirement, many policymakers believe it is important to encourage older workers to delay retirement so that they can maintain a quality standard of living throughout their retirement. One proposal to encourage continued work would be to increase the early eligibility age for Social Security benefits from age 62 to age 65. This could possibly hurt individuals who need to retire from physically demanding jobs but would ensure that people receive higher benefit amounts once they were able to fully retire. Other proposals that could promote more work at older ages include expanding phased retirement options and reforming pension and defined contribution systems to create incentives to work and save.