This is truly sad. As a Swede I fear my country may follow suite. The retirement age in Sweden used to be 65 and now it's 67.
Looking at older people around me, most lead a much less active life after 75. So, if we were lucky we used to have some 10 good years of doing whatever we wanted before old age and age-related diseases start affecting us so much we become limited to a much smaller world. But now we have maybe eight years and if we follow Denmark, five years.
I think if you've put in 40-45 years for the man, you should be allowed to have some good 10 years for yourself. Travel, play golf, cross a continent in a camper or climb a mountain.
There is nothing sad about this. Mandatory pensions are not a vacation sponsored by the government but a way to provide for those who can't provide for themselves.
If you were born in the 70s, you should have known for most of your adult life that your normal retirement age is likely going to be around 70. The demographic situation is not new, the solutions have been discussed extensively since at least the 90s, and countries that take the situation seriously have implemented several pension reforms since then.
You are not going to be as wealthy in retirement as you are now, at least not on the mandatory pension alone. Your health is probably not going to be as good. If you live in Sweden, you should have plenty of vacation. If you think you would enjoy travel, golf, or climbing a mountain, you should do it now. It will probably be easier and more affordable now than in retirement, which may never come.
Taxes pay these pensions. Taxes that citizens have paid for their whole working lives, with the understanding that they would benefit from that pension fund in their later years.
It's actually far closer to a "vacation", but not "sponsored by the government" -- closer to "that you've been saving for already for years."
This is such a sad comment. Indeed, the demographic situation was known and predictable in the 80's, and for instance in France we did nothing to plan around it.
So now the young generation is expected to pay longer and longer for retirees, who have a higher median revenue and a higher standard of life than the active workforce (per all studies). There is absolutely no way I'm working until 70 to finance errors from the past without a contribution from our current retirees' wealth. There is anyway no foreseeable future with work for everyone until 70 with our current technological progress unless you want to slave everyone in bullshit jobs. All of this is madness.
If pensions where not mandatory you would be almost right. But pensions are mandatory, the state will invest the money upfront and earn from those investments. It's just a way of making you pay more, and then give you back less. Another hidden tax to pay whatever operation their incommensurate ego want to pursue.
I guess this comes down to whether you view what you get back for devoting most of a life to work as a negotiated agreement with government or as a one way street.
You said there’s nothing sad about it and then followed it up with some pretty sad realities. It’s incredibly sad. People should be working less as we advance as a society, not more.
But what is the point of all of increases in productivity if not to let us enjoy life more? Longer life expectancy should be more than offset by the increases in productivity.
> pensions are not a vacation sponsored by the government but a way to provide for those who can't provide for themselves.
If you had the chance to find a nice job that paid well and played your cards right it definitely is, why do we need to pay high pensions to people who own multiple properties, have millions on the side and could EASILY thrive just from their passive income ?
pensions can be whatever we decide as a society agree they should be.
Your perspective is an opinion, and many people share it, it has been a dominant view for decades, but it has never been a universal view.
Sure but the real problem is that we don’t know how to deal with bad quality of life for those suffering the effects of senescence and we have a society that is only just starting to come to grips with the perils of the sedentary lifestyle while allocating a lot of resources to people who haven’t done the work to live a good life past 60.
And we make it hard for younger adults to make time for this. Don’t work yourself half dead by the age of 30 and you will never have secure housing in any major city (where incomes are highest).
A huge part of it is cars. Most people over 70 shouldn’t be driving but we have had these people who have been driving everywhere for 55 years. They lose all ability to function independently in their community.
Give me sitting in a cafe living in an apartment with stairs and no car in Lisbon or Athens or similar any day of the week once I am old. Better than the old folks home.
Pension is a Ponzi scheme. Explained in terms of economic theory, if everybody works and saves in time period 1, and retires and receives pension in time period 2, then... their pension is worthless, because there's infinite inflation, because no more goods and services get produced.
Retirement depends on having young workers. People approaching 60, 70 simply didn't have enough kids to have good retirement. It's not a problem that has easy and/or fast solutions. Yet, actions have consequences...
> Pension is a Ponzi scheme. Explained in terms of economic theory, if everybody works and saves in time period 1, and retires and receives pension in time period 2, then... their pension is worthless, because there's infinite inflation, because no more goods and services get produced.
You've created an impossible situation which will never exist and then offered it as an example of why taking care of the elderly, something humans have done since before recorded history, is flawed.
I live in Australia where individuals are expected to fund their own retirement, and the government pension is intended just as a back-up for those who are too poor to do so. Everyone has an investment account ("superannuation", or "super" for short) which is taxed at at a reduced tax rate, and your employer is required to pay 12% of your salary into it. There are many providers of such accounts ("superannuation funds") to choose from (normally your employer has a recommended fund, but you aren't obliged to use the one they recommend) – and if you really want to you can set up your own superannuation fund (a Self-Managed Super Fund or SMSF) in which case you can make all the investment decisions yourself (subject to certain legal restrictions–you risk legal trouble if you make non-arms-length investments, like invest your superannuation into your own business, but other than that you can put the money in whatever you like.)
So, lack of young workers is not an inherent problem – you can invest your superannuation overseas (most funds invest a certain percentage of the money overseas, but if you want to take the risk of putting 100% of your superannuation into international investments, that's allowed), so even if the Australian economy were struggling with lack of young workers, you could still live off the investment returns from other global economies which lack that problem. And the reality is that Australia is unlikely to run out of young workers, because even though we have similar problems with low fertility as many other Western countries (although significantly higher than most of Western Europe), we've also always had a relatively high immigration rate, so younger workers immigrating makes up for the insufficient births.
It's most appropriately a shared investment scheme. Your pension money should not sit idle while you are building it. That money can earn a percentage in many ways and dividend reinvestment makes the fund grow massively.
> Retirement depends on having young workers.
Profits do. Retirement is going to happen regardless of how many young workers there are.
They just need to be calibrated that the years of pay-in and years of pay-out are balanced as to the ratio of the people in the age cohorts. If you have 10 people paying in for 40 years and only 2 people receiving pay out for 10 years then the system is cheap.
> Pension is a Ponzi scheme. Explained in terms of economic theory, if everybody works and saves in time period 1, and retires and receives pension in time period 2, then... their pension is worthless, because there's infinite inflation, because no more goods and services get produced.
Except if you take a portion of the contributions and investment in incoming-producing assets.
Kind of like what the Canada Pension Plan (CPP ~ US Social Security) does.
It depends on the system. In Holland they just abandoned this for a US-style "every man for himself" 401(k) thing. Luckily there are still parties fighting the implementation.
I don't think ponzi scheme is justified, it is too negative, it just makes no sense to actually accumulate all that wealth for so long.
It feels like the problem is that we've drastically improved people's lifespans, but not their healthspans. Back when these systems started getting implemented, you could reasonably work up to the retirement age without too many issues. Nowadays, people may be living to 80 instead of 60, but our ability to work and willingness to hire people past 60 hasn't gone up with the increase in lifespan.
We did not improve people's lifespans. At least not that much. What happened is that young people die less due to less hazardous conditions which improved the average age. Also the average age is not the problem. The problem is that social security was setup as a ponzi scheme (younger pays for older) instead of a saving scheme (each one build a nest for himself). A ponzi scheme will eventually implode but if you manipulate the parameters you can make it go further.
> Travel, play golf, cross a continent in a camper or climb a mountain.
Do that today. Tomorrow isn’t promised, let alone 10, 30, 50, 70 years. Don’t be one of those “When I retire”-people, do it now. _If_ you make it to retirement you may not be physically able or willing to do things you’ve been dreaming of for so long.
If you are waiting for retirement, then you are not living.
> I think if you've put in 40-45 years for the man, you should be allowed to have some good 10 years for yourself. Travel, play golf, cross a continent in a camper or climb a mountain.
Not unless you've raised 2 more workers to pick up the shovel while you're playing golf. You could, of course, rely on your neighbor's kids through taxes and pensions but when your neighbor thinks the same it becomes problematic.
On the plus side, if you did raise kids, you may negotiate your retirement with them even if the averaged government system stops working.
1. Denmark has a special retirement system for people who started work life earlier than normal, allowing them to indeed retire after some 45-48 years of work. All these rules are broken though.
2. These ages only affect a minimal government pension, and a massive tax saving on cashing out a specific, government approved retirement investment. If you wait to start receiving payments on that till retirement age, you avoid paying income tax of it. You can start earlier with worse taxation, or use regular investment types altogether. The overcomplicated tax system and its incentives are quite broken though.
3. Danish politicians still have a retirement age of 60 and a massive retirement package, so they can't deem retirement age and available funds to be that important...
> I think if you've put in 40-45 years for the man, you should be allowed to have some good 10 years for yourself.
Who do you think would "allow" this? God? This is a resource constraint imposed by reality itself catching up to an excessively idealistic set of policies; this policy decision is downstream of that, not arbitrary.
It is entirely arbitrary. Society heavily favours capital above labour. That’s why we have very rich inheritors never working and people toiling until they are 70. It’s entirely a choice. This issue has solutions we collectively decide not to put in place.
Of course there is no guarantee that your 65-75 years will be good, but it's a lot more likely that your 65-75 years will be good than your 75-85 years.
> This is a resource constraint imposed by reality itself
No, it is a resource allocation problem.
I don't think we should have ceilings, but we certainly should have floors. Minimum standards. Despite that belief, I think there is something wrong when there's about 20 people who make more money while they take a shit, than most American families make in a year[0] and a buttload who make that same amount while they're asleep[1]. These levels of wealth are so large that they are extremely difficult, if not impossible, to spend within several generations, not just one lifetime.
This is only a problem, because the floor is lowering while the number of people in these groups are growing, especially the shit group.
If we have to make trades between ceiling and floor, I'd rather sacrifice ceiling for floor than floor for ceiling. Because the latter is simply greed.
Importantly, we can have both. This isn't a zero sum game, we produce more wealth and resources as time goes on. It is only zero sum at a single point in time. We can simultaneously raise the ceiling and the floor. But currently, we are shifting what percent of these gains go to which groups.
It would be insane to build extravagant and ornate Cathedral ceilings to only have a dirt floor. It would be dangerous to build those ceilings without ensuring there is a strong foundation and forgetting to build the pillars to support them. Without that, the ceilings fall and it all becomes dirt and rubble.
It is an allocation problem, not an amount problem.
[0] If you have $100bn, are able to make a conservative 0.05 yearly interest and take 5min to shit, you've made ~$50k during that time.
[1] You only need $1bn given the same statistics, but closer to $45k. There's over 3k billionaires.
This is why it’s better to have a higher salary vs relying on government to provide a better standard of living at the trade off of a lower salary.
With the high salary, even if the cost of living around you is high, you can still make choices to save and invest money to eventually become financially independent and retire when you want, where as if you have a low salary, you don’t have that flexibility, you are at the mercy of the systems around you.
"Investing money" is insufficient. You still need kids and the newer generations at the end of the day.
Think where you are going to invest and how that investment is going to provide returns. Stocks? Those companies actually need to produce and hence need workers. There also needs to be a broad consumer class to purchase those products. Without younger generations, you have no workers and no consumers which means your stocks have no value. Same with bonds. Same with real estate.
consider what humans did before society. they followed herds of ruminant animals and hunted them. they were working 90% of their waking hours. their work was their lives. but at night they would spend a few hours looking at the stars. what we have now is pretty similar. except instead of stars we have screens. i would say life is ok if you can read something interesting every day and have a job that you enjoy. i would say you should prioritize having impact or having a job you love. everyone accumulates as much money as possible at the expense of everything else… there are people with millions saved up at the age of 60… who then die shortly after and did a bunch of work for nothing. keep enough saved to cover modest expenses for a year. beyond that, priotize other things
I take issue with the idea that pre-modern humans were working 90% of the time. We know medieval peasants didn't, we know bronze age societies didn't, and we have no real evidence to support hunting based societies doing it either, especially when we consider the lower nutritional health of past humans that made physical labor far more difficult to maintain consistently without just dieing from pushing the body beyond its limits. It is far more TV trope than reality going by historical sources. Medieval peasants spent most winters doing mostly random home tasks and small crafts while they sat around a fire. And farming based societies generally put in the vast majority over their work in a two months in spring and in the fall. You don't plant fields in July, you just complain about the weather not being ideal for plant growth and did basic living chores that you always do like washing and mending your single pair of clothes or patching up your roof or milking your cow. But there is only so much mending and washing and milking to do.
Or look at ancient egyptions, they very clearly didn't need to work 90% of the time if they got time to build massive pyramids, and there is considerable evidence that pyramid workers were not forced to work, but simply offered extra booze and food for doing so. If you didn't work on those projects you weren't starved to death, you just didn't get to drink as much alcohol with your buddies or brag about how you helped build a wonder that will stand for hundreds or thousands of years.
> they were working 90% of their waking hours. their work was their lives.
This is not true at all. A quick google for “hunter gatherer work hours” would tell you that they worked far less than we do today. 2-5 hours of what we would define as work a day, with the rest being mainly leisure.
> "they followed herds of ruminant animals and hunted them. they were working 90% of their waking hours"
Idk if you've ever seen sheep in person, but "standing near some sheep while they eat grass" is not work in the sense of effort, concentration, labour. There's a reason the Boy Who Cried Wolf was bored out of his skull, and why shepherding was a task given to a boy while the village adults were doing other things.
Why do you think Sweden decided to raise the retirement age instead of raising taxes to keep the current retirement age?
Another idea: Allow people to retire early, but they receive lower monthly payments from national pension. Most national pensions have the reverse: You can retire later and receive higher monthly payments.
> I think if you've put in 40-45 years for the man, you should be allowed to have some good 10 years for yourself.
The problem is that huge number of people live way longer than 75, like to 85 or 95 and such, which imposes a huge financial burden on the state (pension and healthcare costs).
Isn't this more about letting people who want to keep working do that? What's stopping people in Sweden and Denmark from retiring earlier? I would imagine there are some pensions plan withdrawal requirements or criteria for government assistance but can't you just save money to bridge that gap?
Maybe we need to start thinking about these things differently. I would love to have more time off but still have a job and not need to make this so binary.
Can't speak for those countries in particular, but generally you can work past retirement age, or retire earlier if you have funded/planned for that. A retirement age is usually just the point at which you can receive government assistance as part of a safety net. I assume if it's not pegged to life expectancy, the cost to the public grows.
Here in Australia, and I imagine elsewhere, there are strong systems (e.g., superannuation) to encourage personal savings towards retirement.
There's only one issue I can think of with your idea that someone who is 75 now leads a life as you're describing.
The generation they belong to are predicted to live to what 80-85 years? Whilst we (assuming you're in your 40's now) are predicted to get to what 90-95 on average?
Average lifespans are increasing, and on top of that the mobility of someone who's 75 now, won't be the same of someone who's 75 in another 35+ years.
At least in the US, the SSA projects current 30 year old men to live another 48 years, putting them dead around 78. 30 year old women are expected to die around 82. [1] A quick Google shows life expectancy is about three years higher in Denmark, not an extraordinary difference, and some of that number is probably lower infant mortality.
Barring some revolutionary technological breakthrough, we aren't going to be living, on average, into our 90s.
Does anyone know if there's any kind of metrics for healthspans? Meaning the "good" part of life before it's just doctors, medicine and retirement homes.
My impression so far is that we've done a lot of work at the lifespan, less at the healthspan. What's the point of living until 90 if the last 15 years isn't that fun at all.
Poorer individuals, who need retirement most, don't tend to live as long. Millennials and Gen Z are already victims of old, no-longer-applicable narratives (e.g. save cash, avoid debt, go to college...) and these ones about life expectancy will likely be added to the pile and used to disenfranchise us more while having no connection to reality.
With an aging population and increasingly long work lives, individual stressors will increase and societal capacity for healthcare (and overall prosperity) will dwindle. Baby boomers, having lived through some of the most incredible growth in human history, will perhaps turn out to be an anomalous blip in the life expectancy stats.
Also, people age differently. There's a difference between living and being alive.
Not that it's an easy problem to solve, what with the demographics being what they are. I think we'll have to get used to the thought - and reality - of sinking living standards in the west.
I’m so sorry to see this American mindset infect Europe.
As an American, I can’t realistically retire until 65.
65 is when Medicare is available.
I’d prefer Medicare started from 21 paying out-of-pocket as an option; then the payment starts slowly phasing out at 65. Not this abrupt, all-or-nothing.
What's sad about it? Even with raising retirement age, the average duration people receive pensions has increased A LOT over the last few decades simply because life expectancies have increased so much. Someone who retired in the 1970s would receive a pension for less than 10 years on average - someone retiring now will receive a 20+ year pension.
IMO retirement isn't a long holiday but it's for people who cannot contribute to society anymore.
That point might be reached earlier for some people, e.g. those who have a hard physical job, than others and a general retirement age is an approximation for when that point is reached for the general population.
Retirement doesn't mean I won't contribute to society anymore. It'll mean that I can contribute in ways that I am most interested in, without having to make money doing it.
Well if you have enough money to do all that then you probably have enough to retire a little early. Why not stop working at 60 and fund the first few years of your retirement out of your savings?
From what I understand if you retire early you must fund your retirement until the end. So you either work until the requested age and get something, or you don't and don't get anything. You can't just stop at 60, fund your retirement from 60 to 70, and then expect the gov to pay for your retirement from 70 to the end. Maybe I'm wrong tho.
Part of me wonders if capitalism is the solution to the Fermi Paradox because the endless chase of profits is driving us to extinction.
In many Western countries, younger people are facing the prospect of never being able to own a house and never being able to retire. Beyond this basic lack of security, people are realizing the cost of having children is absolutely astronomical. In many parts of the US childcare may be costing $3000/month or more per child.
For many people, pets are proxy children, and yet capitalism (private equity in particular) is ruining that too as all the vet clinics are being bought up so people can be gouged on that front too.
I'm someone who views the Labor Theory of Value [1] to be trivially true. After decades of Red Scare propaganda, Americans in particular dismiss Marx but they don't realize that Marx's most famous work (Das Kapital [2]) is primarily a framework for economic analysis, regardless of your political beliefs. I guess the problem is that as soon as you accept the axiom "there is no value without labor", there is no other conclusion than to see capitalism as the exploitation of surplus labor value.
The US corporate sector produces something like $4 trillion per year in corporate profits [3]. There are over ~210M working age people in the US [4] (about ~262M adults total). So that's ~$20k per worker in surplus labor value at a time when we spend ~2x per-capita on healthcare for worse outcomes and less coverage [5], housing is artifically expensive because we allow people to hoard it and education is unjustifiably expensive.
None of this has to be this way. We've simply chosen to prioritize the interests of fewer than 10,000 people at the expense of everyone else. People need hope. They need their basic necessities taken care of. They need something to live for. We're rapidly heading towards a future where only the rich survive but there's no one left to work in their sprawling estates.
It's also wild that we're seeing the rise of fascism in the West while there are still survivors of the Holocaust still alive. This is absolutely true in Europe too (eg AfD, Reform, National Front, whatever Hungary is). I also think we've passed the point of being able to resolve this with electroal politics. Now it only ends in tyranny or revolution.
This is one of the more rational comments. I’m really surprised there aren’t more comments expressing how insane this topic is.
It’s absolutely insane that technology and productivity are increasing so rapidly, yet we’re talking about raising the retirement age and people being increasingly unable to afford children.
Where I live, people have issues getting hired past age 50, and it’s near impossible past age 60. It’s a stroke of luck if you score a job then. So yes they can raise retirement age, but that will just create misery for all those who can’t cling to a job long enough. There‘s got to be a better way.
In Denmark, you also have to have a medical exam to maintain your drivers license after you turn 70, but they have no problem with carpenters running around on roofs until they're 74.
Part of the reason employees are reticent to hire someone past 50 is before they worry they’ll retire soon, even if they’re mentally and physically in good shape. So increasing the retirement age might actually improve the ability of folks in their 50s to find work.
Not saying this is a great trend, but it’s unavoidable due to the low fertility rate (already a problem everywhere in the developed world and soon to be a problem the world over, as by 2050–before I retire—the global average total fertility rate will have dropped below replacement.).
That’s not a plausible theory to me. IME older people are just less likely to work hard. They bring a “rest n vest” mindset. If an older person rounds a 40hr week down to 35 hrs, and a younger person rounds up to 45 hours because they are passionate and ambitious, all else equal the younger get person is better ROI for the team. Obviously this is stereotyping and may not be accurate but that sentiment can explain many decisions.
> (...) the global average total fertility rate will have dropped below replacement.
My pet theory is that when the system becomes untenable, procreation slows down, which will in time trigger a kind of reset - not that it's going to be fun to live through or anything. Self-regulation.
Sorry but how is this different from hiring someone in their 20s and they are very likely to job hop to another company 1 / 2 years later ? I don't think anyone will believe this.
Cut all things that promote or enable public health.
In neo-feudalism, only lords and perhaps some of their most favored serfs, deserve private for profit health care, and the barrier to entry is cost. Why be wealthy if you can’t buy things other people can’t?
There’s always a surplus of peasants in this model.
When people talk about raising the retirement age the assumption is that the people affected will all be unemployed, not that they'd still work in some capacity.
Almost every single industrialized country has a birth rate below replacement, so there's fewer younger people to help carry the burdens. Medical care means the elderly live on and on and on, draining enormous costs as they age.
I'm not trying to be cruel, but from a pure numbers sense it makes perfect sense. Would you prefer taxes go up instead? Lessen spending on infrastructure and healthcare? Lessen child labor laws? There's no a lot of winning answers here.
And overall, the problem is just going to get worse in every country for the forseeable future. Expect to see more of this as time goes on. It's a bandaid solution though.
Tax wealth. I know that's a very hard thing to do due to the mobility and political power of capital, but we need international co-operation and just do it. That's where all the money is and where it's going at an accelerating rate.
The way this tends to turn out is that the type of assets accessible to younger/working people is taxed and the type of assets held by older/non-working people is not.
E.g. look at Ireland. Ireland has a de-facto wealth tax ("deemed disposal" - taxing the unrealized gains) on ETFs starting at the first euro, which makes investing basically pointless. Meanwhile it also has one of the lower tax levels on property in the EU.
Realistically productivity increased by leaps and bounds over the past few decades. If leaders can’t figure out how to take advantage of that instead of taking advantage of the people then they have no business leading a country.
The solution they are applying now is a dead end, literally. It doesn’t scale, the only place it leads to is people guaranteed to die “at work”.
And elephant in the room, people in their late 60s aren’t even close to productive compared to the younger employees and if you lose your job in your 50s or early 60s you’re condemned to a decade or 2 of being supported by the family if you’re lucky.
So a person in this position is a hidden “tax” on the tax payers in the family, or on the companies who still employ them, if any still have them at that age. Countries are better off just directly taxing the companies regardless of whether they hire 70 year olds. But that won’t happen.
100% yes. My father is 67, and to be honest, he really shouldn't be working anymore. Both physically and mentally. And he is not very sick or disabled in any way. He just doesn't have the same capacity as he had in his 50s so after a 9-5 he was just recovering and going to sleep for the last few years. Terrible.
He retired last year. He didn't have an easy life. Very few jobs would benefit from his work and continuing working would have a great toll on him.
Yes. Looking at my country, we've applied economic liberalism without any positive results at scale. I would prefer we go back to taxing companies more, go back to taxing the rich on their assets and crack down on fiscal fraud (20B€ estimate, about 6% of the national retirement cost).
Instead the government privatizes services that used to bring a steady income and defunds hospitals, education and public research.
Incentivising to have more kids is not going to work. Things have changed. A lot of people just don't want to have children, and it isn't a financial issue.
There does not seem to be a strong correlation between countries which make it easier and more affordable to have children, and the replacement rate.
Hopeless measures. Nothing can persuade a couple to f... for kids, except if you force a medieval-like state based on religion and women oppression. Only such states historically guarantee >2 kids per couple, unfortunately.
Shouldn't expenses be proportional to population size? If not so, then spend less? Birth rate below replacement doesn't mean population size is not enough to pay for expenses, it just means it will slowly decrease, which btw is good, we are definitely too many. In nature only bi-sexual reproduction is capable of reducing population size when needed, that is a very good indicator that when resources become scarce, only those who can reduce their population size can survive, otherwise we would reproduce by binary fission.
Infrastructure can't be scaled down easily once it is built. You can't just shrink roads, water lines, electricity lines and otherwise once a population has shrunk. Nor can buildings like hospitals and fire stations. So no, expenses are not proportional.
Those costs continue, and now you have fewer young people to pay for it - and more elderly that will need assistance. It is vicious.
Some countries like the US have skirted past this problem due to immigration. Others like Japan have not have much immigration and are beginning to suffer the effects.
But every country will face it in the long run.
The cold hard fact is that when people are educated and have access to healthcare, they simply stop having enough kids to meet replacement rate - even when wealthy and when having great support systems.
Humans do not act like most species. We do not form neat equilibrium with our environment based on available resources. That kind of logic didn't apply the moment agriculture was developed.
Denmark, 6 million wealthy people, 4% economic growth, 1.5% inflation, 2.9% unemployment, national debt of 25% of GDP and budget in surplus. How did it all go so right?
It's because people are living longer and their government retirement plan savings aren't enough to support living that long. Increasing the retirement age means you spend another five years paying into your retirement fund and have five fewer years to spend it. If you have additional retirement savings of your own, you can still retire earlier.
That depends on what driving it. If it’s because the budget was unsustainable and needs to be cut, that’s bad. If it’s because people are living longer, then it’s just an unfortunate consequence of good things. I suspect it’s the latter.
I don't know if I would so easily conflate necessity to political legislation. Both politics and politicians are very commonly out of touch with average citizens and what they need, and often ignore the policies that would benefit the state the most in favor of pursuing personal ideals and maintaining political positions and power. If a policy is good for a state 20 years down the line, but will cost them political positioning in the meanwhile or challenges their notions on what they are "suppose" to do either ideologically or socially, or results in their often substantial personal investments having lower returns, I wouldn't often bet on them choosing the state over themselves.
Dane here. It's not a coincidence that Scandinavian countries fare well in most stats. Most Danes point to a cultural bias towards very flat hierarchies in society and work life as the source of wealth, happiness and trust in each other.
The USSR and Yugoslavia and Albania and Cuba and North Korea and Vietnam and China pre-2000s have all had far higher tax rates than Denmark during their worst times, so probably not a great correlation.
Denmark is like all the other Nordic countries culturally, except they have much easier direct geographic lines to Central Europe. So it’s basically what you get when you combine the Nordic model (tiny homogenous Lutheran population) with more advantageous geography. Finland is Denmark with extremely unfortunate geography.
Having lived in Denmark for quite a while, I will say that it is the societal coherence, and an attitude of working together for all which must have been influenced with the difficulty of surviving in that landscape in the past.
Societal coherence has been aided by the isolation, and here is the hot take: this cannot exist in "diverse" societies. Not because of bullshit genetic superiority justifications, but because no diverse society has so far demonstrated the capacity to have a shared purpose, coherence and high degrees of trust.
And yes, I do find monoculture societies (including denmark) very boring, and I believe diversity has other great benefits. But societal stability and long term prosperity in that sense? Doesn't look like it.
Before someone mentions the US as a counterexample, do not forget that all the prosperity of the US came from basically seizing an underutilised (in the industrial sense) resource rich continent, and now it is falling apart by internal divide.
The divide is a feature, not a bug. There’s a reason the US is called an experiment, with all the trials, tribulations, failures and successes that come with that. “We do things not because they are easy, but because they are hard.”
Or they could build their own wealth/have children to provide for them in old age and retire earlier not rely on what should be government backstop for the most incompetent.
Denmark’s immigration policies are not nearly as tough as their reputation nor to credit them as the source of economic prosperity.
Denmark’s economic prosperity comes from investment in free higher education for all, generally healthy lifestyles and the flexicurity-model, which provides a flexible labour market and promotes risk-taking.
I would like to point to a topic about extending pilots’ mandatory retirement ages. Most pilots plus or minus retirement age are unable to pass the physical or mental demands of the job, so only 25-30% are able to work and not on short- or long-term disability. Some choose to work privately past retirement age. I don’t have any numbers for pilots who decided to leave, were forced out, or could not pass the training.
Extending the retirement age doesn’t really help the situation much, as you need younger and cheaper pilots to fulfill the roles of pilots who are retiring.
The problem is, becoming a pilot takes a fair amount of time, over $100k in training fees, low pay for a while until fully certified with hours in, a very mobile lifestyle, and now you are subjected to physical as well as mental demands of the job certification standards.
There are quite a few highly paid professions where the main purpose of that profession’s union seems to be to prevent there being an adequate supply of the professionals.
What I find interesting is how often casual discussions about unionization on the internet will organically reinvent this concept. Especially on HN, Reddit, and Twitter the banter about unionization always seems to pivot toward using the union to force companies not to hire certain developers.
The obvious one that comes up in every discussion is thinking that unions will protect their jobs from being outsourced to other countries. People like to layer various more palatable explanations on top of this to make it sound better, but when you ask them if the employees who receive the outsourced jobs should get the same union protections you usually get their real motivation: They want to keep the jobs local to their own market and exclude foreign labor supply in order to improve demand for their services (and therefore their leverage, and therefore their own wages)
It gets interesting when different demographics start imagining that their ideal union would protect them from other demographics: Commonly, older people like to think of unions that will protect them from losing their jobs to young people.
Then when I’m working with college students and they start discussing hypothetical unionization, they come up with ways to think the union will give them more jobs by protecting them from the old people “hoarding” the jobs. (Sorry, that’s the least likely outcome for a union)
What’s most interesting is that the people I know who are in unions (non-tech industries) don’t hide the fact that decreasing labor supply to increase their own demand is exactly what they expect from a union. The first time you hear someone complain that a non-union worker is “taking food off their table” by simply doing their job you realize that it’s not as simple as Unions versus Corporations like we’ve been led to believe. The Unions are advocating for the people in the union, not workers everywhere.
The cost of training is real. 15 ago a colleague did the training slowly while working for some training companies and it costed him just $42,000 to get ATPL, but you need to take trainings and flight hours and that is most of the cost. There are enough people willing to become airline pilots, but most don't have the money and the cost is not an artificial barrier.
Even the cost of PPL, the lowest license on the path, is around $10,000 while the ultralight (European)/sport pilot (US) is over $6,000. From that you need CPL (commercial), multi-engine, complex aircrafts, instrument rating (bad weather or night) etc., that takes time and money most people cannot afford.
Its just like nationality based employment rights(need to be citizens or have a visa/permit to work) but more granular.
It can have its place, i.e. a way to balance bargaining power with the employer. It’s inherently anti meritocratic though.
In some cases it’s not about merit or about limiting supply however. In some cases it’s impractical to test someones work continuously, so instead it becomes honor based. That is, you are expected to go through an elite track and succeed in an exam once and then you are good for life unless you commit fraud or show gross incompetency.
The broken pilot training pipeline is mainly a US problem. Airlines got spoiled because the military trained thousands of pilots every year for "free", then some would go on to get civilian flying jobs. Now the military is smaller and there aren't enough experienced pilots coming out. But there's nothing preventing airlines from hiring pilot candidates with zero experience and paying them to go through flight training. Some other countries do this and it works fine.
For pipeline capacity, it's not even really broken in the US. The airline problem is that they have to whipsaw between "growth is stalling, time to furlough our junior pilots" and "growth is now, time to hire all junior pilots with ATP minimums". But there's enough pilots being trained to handle the average.
The system has effectively failed most everywhere on the West. The post-WWII generations are numerous and have a long life expectancy, apparently longer than the pension systems planned for. Generations that came after them are less numerous, and, in a way, somehow less prosperous. They cannot pay enough to keep the pension systems afloat.
The Japanese faced this earlier and harder than Europe, with about 30% of their population being past the retirement age. They increased their productivity very significantly, but it's still not enough, and a lot of older folks in Japan keep working well past the retirement age, sometimes even re-hired by the companies from which they had retired.
But people are living longer, in better health (I think but didn’t verify with data) and entering the workforce later (due to more secondary schooling).
Setting aside the issues of declining birth rate for a minute, this seems like a reasonable adjustment to the other factors?
True but no matter how healthy one is in their 60s and 70s people's health degrade significantly in their 80s. So, you have then 10 year of healthy life after retirement.
There's the flip side if the coin though: old people are healthier in Denmark (vs US for example [1]) due to the social welfare system. Well, that system needs to be funded. With the aging population, the costs are rising but contributions are (relatively) declining. That's why there's a push for higher retirement age. It's either this, or defunding the social welfare programs, or immigration. That last one isn't a viable political option in Denmark at the moment.
Personally, I'm not sure that they are living in better health in the way that I care about. I.e. my goal is to retire when I'm still healthy enough to do things (i.e. travel). Although they are likely healthier than previous generations, most of the 70 years olds I see still aren't healthy enough to travel.
It is simple mathematics. European pension systems are not a saving system, but a pay as you go system, where pensions are paid from the people who work now. What you get in taxes this month you pay as pensions this month, as a state. This is the Bismarck model and it was invented at a time when the average lifespan was lower than the pension age, so many people were contributing very little as a percentage for very few people to get pensions. Today the situation is the opposite, with less and less people paying (not too many people start working at 16 years like in 1860), retirement age was lowered in most countries, the percentage of salary you pay as pension tax can be 25%, growing that is not too easy as this is just part of the taxes workers pay.
This system was working back in 1860, but it is a Ponzi scheme in decline for the past 50 years. And there is no way out, most people rely on state pensions to live after retirement; it is the perfect trap.
If pensions were funded by actual retirement accounts, where employees invested money into some state fund and have it paid out for retirement this would be entirely unproblematic.
But the pension system in many EU countries is set up in a way in which tax contributions now finance pensions now. This can only work with a steadily growing economy which continually generates more revenue when more people retire. In some sense it is a literal Pyramid scheme, in which the obligations are continually pushed to younger generations, which have to contribute based on how many pensioners there are.
Especially now as EU economies become weaker this issue becomes bigger and bigger.
Fundamentally any retirement plan that doesn't involve canned food in a celler is pay-go because the retirees will be consuming resources from the economy they retired into rather than the one they were workers in.
Their retirement savings can be in public company stocks instead of government guarantees but that only works if there are people willing to buy those stocks (ex: younger people saving for retirement).
No, fundamentally it doesn't really matter. Retired people consume but don't produce. They are fed by the economy of today, not by economy of the past.
Whatever you accumulate for retirement (cash, stocks, gold, state pension points) it only represents coupons for your share of the economy of the future. Details may differ but fundamentals are the same: it a promise that the future generation will share some of their yield with you.
> If pensions were funded by actual retirement accounts, where employees invested money into some state fund and have it paid out for retirement this would be entirely unproblematic.
You're talking about a system of pension by capitalization, like in US, which comes with its own problems.
Namely that if you reach retirement age during a crash like in 2008, you're screwed. You have to work 5 more years hoping the market recovers in the meantime, or retire anyway and get way less than you put in.
- increase productivity more than how much the workforce/receivers grow.
And if AI/robots eventually deliver, we're soon going to need a discussion about lowering the retirement age to 55 or even 50 if we don't want 30% unemployment anyway.
That omits the essential fact that economies tend to grow - quite a bit over your lifetime. 2% compounded annual growth over 50 years will result in the economy being 2.7x its starting size.
Typically EU countries implement the 3 options together - option 1. btw is meant to make the pension irrelevant. It can't happen from one day to the next, but there is a shift happening where people contribute more and more towards private pension funds. It's easy to see that at some point, there will be the equivalent of the US 401K in Europe.
How would you fix it? Note that even Scandinavian nations with very generous healthcare and childcare policies can't raise their rates, it simply seems that as people get wealthier, they have fewer kids, regardless of the status of their country's systems.
Yeah, people keep trying to find a purely economic reason for why folks are having less kids. I think I'm satisfied with the very simple reason that raising kids is hard work. Most people feel like 1 kid already gets their hands full. That's really it IMO. Whenever it was that joint families split up into disparate nuclear families, obviously the load of raising say 5 kids that was being shared among 20 people, suddenly fell on just 2 people.
In the places with high fertility rate, you will almost surely observe joint families. I'm from India where we have such demographic variety that you can see adjacent areas with completely different fertility rates. In one, you will see old-style large houses with courtyards and 15+ people in them living as a joint family. Invariably these people have more kids. But in the next town with more nuclear families and modernish apartments, you will be lucky to see 2 kids per family. [1]
This is what births the secondary economic incentives which are mentioned a lot in popular discourse. For example, if you're already living in a house with 15 people your financial realities will require a similar number of people in the next generation to continue the same lifestyle.
[1] Wealth is not a confounding factor here. The specific two areas I have in mind are both more or less equally wealthy, one has folks running a coconut business primarily and the other is a small town with the usual assortment of office jobs.
My take is that saying the problem is birth rates is misguided. Surely we have enough labor to provide for the elderly, why can’t our economy be structured to get this labor to the people who need it?
It's not that you are expected to work that long. It is a case of not being expected to work longer than that. You are always welcome to retire earlier if you have the financial means to do so. You are also welcome to work longer than that should you have the desire to do so.
Of course, those last two sentences are tongue in cheek.
The real problem is that certain segments of society are not compensated for their labor at a rate that would allow them to retire early, and may even have to work beyond retirement age in order to supplement their stipend. Worse yet, these people often work in sectors that offer few affordances for them to maintain their health into old age and may even push them into living conditions that are detrimental to their health (assuming their job isn't detrimental to their health in the first place).
Ideally, people would be able to retire when they want (within reason). The reality is that some people can retire at a relatively young age while others don't really have that option.
Maybe the system needs a rethink; an expectation that everyone able to will pretty much work their whole lives, but making work much less miserable and time-consuming so that's just fine.
Ha. Total pipedream. It is easier to imagine the end of the world than to imagine the end of our current economic system.
Higher life expectancy more like, the state can't afford for people to spend 20 years unproductive. This is a much less acute issue in the USA and Russia where health is poor and life expectancy low.
The first pension was put in place by Bismark as a way to "steal the clothes of the socialists whilst they were bathing". It was seen as the cheapest social benefit because life expectancies were so low. A popular policy delivered at low cost to the state.
That people are living longer is why the system is failing. It's an interesting thought experiment to consider whether any country would introduce a state pension now knowing how much they cost.
I'm in the US, but I'd be happy if social security ages were pushed out to 75 or 80 but benefits preserved.
I'm saving heavily for retirement, but the biggest challenge is figuring out how long you're going to live. If you have sort of a defined and horizon, it's much easier to calculate.
The social pension system always was a Ponzi scheme where the ones who got in first(boomers) get the biggest share of the pie(10-20 years of life left after retirement), while those coming into the system last(millennials+) and pay for the current retirees will get rug-pulled(5-10 years of life left after retirement).
Sustainable population and economic growth at that rate can't happen indefinitely.
Some people have been vocally saying this system in unsustainable long term, just that Europeans governments never wanted to publicly admit this due to fears of loosing elections, so they kept kicking the can down the road.
The boomers definitely weren’t the first getting in, the original pensions were paid to their own parents
It’s not really a Ponzi scheme, it is completely possible for the system to be balanced, it’s just very very hard to get people to vote for you if you say they’ll have less tomorrow
My boomer parents are already pushing being retired for 20 years, neither did anything more than the bare minimum in life.
They could have easily worked 10 years longer instead of doing nothing but drinking wine all day and/or going out to restaurants in retirement. That is in between traveling to go out to restaurants and/or drink wine.
The boomers scammed us all and aren't done yet. They are going to make sure to bankrupt the entire system with healthcare cost before they go.
No it isn't because of their birth rate, or at least, birth rates are an issue orthogonal to it.
In some rich countries people spend now more years of their life out of work than in work because of much longer education and much longer lifespans. If you want to keep the same social standards, all other things being equal, you need to raise the retirement age.
Of course it failed when it was created in completely different circumstances.
Or some may say it got outdated.
It was started at times when the life expentancy was low. And it was given at age above the life expentancy. And in the beginning not to everyone. The retirement age got lower and given to broader set of population gradually. These moves made governments popular, so it was no brainer to introduce, on the expense of future generations.
Birth rates that can maintain the economics of relatively low retirement age could not be sustained without destroying the planet. Actually has to be reversed still as it went too far already and deteriorating as we speak, especialy with the ongoing large increase in the overall life quality - causing decreasing birth rate alone - and healt. The system was destined to fail. But how to take away rights? It is much harder than giving, especiallly when the adverse effects are for current voters, not future generations?
So the necessary steps are postponed, postponed, postponed yet again, for many decades, taking about necessity in many forms, meanwhile filling bigger and bigger holes in the budgets, through borrowing, making the problem worse, again for future generations. Very few countries do tiny adjustments, and even those are met with huge protests mostly.
I wonder what the future holds. Painful adjustments or more painful collapse later in some form.
I’m not sure how I feel about this. I’m based in the Nordics and my estimated retirement age at the moment (where I can get my state pension) is 67y 4m. Whilst I understand the burden the aging population is having on society (lifespan) it doesn’t seem like there’s much proactive government input into people’s healthspan.
Maybe instead we should try investing in this area (reducing the burden on services) instead of simply trying to reduce the quantity of folks claiming from the state pension pot.
Sure. But is that the society we want to live in. Do we not have ambitions to have people work less, enjoy what little life they have more? I'm not saying this is an economically easy problem to solve, but we focus so much on economics and so little on policies that make people happy.
Economically, old people are a burden on society. If you want to have a long and easy retirement for your elderly, you need a growing population, forever. Like a ponzi scheme. The alternative is that you break young people's back by burdening them with providing for the elderly. No amount of redistribution will help a country with poor productivity. 60 was a reasonable retirement age years ago, because most people would be dead soon after retirement, but with people regularly reaching 80+, 70 for retirement seems very reasonable. It wouldn't surprise me if the average gen Z reaches 90+, so maybe they should be working until they're in their 80s.
I am Gen X and fully expect to be working until 70, hopefully.
I knew a guy who worked full time at a bank at 85. He said all the time he didn't have to work but what else was he going to do all day? A big reason he was able bodied at 85 was from working and not sitting home all day.
I think we have confused retirement fund/planning marketing with reality.
The retired people I know are physical mess from retirement. Alcohol and restaurant food all the time, will be needing long term care much sooner than if they had worked longer.
If you had to pick an age for societal burden, it'd be the average "young" person who isn't making a net-positive contribution until around the age of 25. Most people don't receive a corresponding 25 years of retirement, and the retirement they do receive is a product of contributing to it for 40 years.
But it turns out young people become middle-age people, become old people, and we're all in this together. The real problem is not about how the pie is split across generations, but about the realities of lifespans, economic production, and expenses. If you're responsible for funding the entirety of your retirement, all of this is abundantly clear. When you nationalize retirement, all sorts of budgeting tricks start happening, like "borrowing" to fund other programs, papering shortfalls via population growth, etc. Then you start getting age warfare when the govt has to eventually cut back.
You could dissolve the national retirement plan, but that seems like a bad idea for similar reasons as entirely dissolving national welfare and insurance programs. It will always be the case that some people, need some help, some of the time. I guess in my ideal world, it's reduced to a much smaller safety net, because the government is managing the economy well enough that the populace has the wherewithal to save appropriately, and they are educated enough to do so.
> Maybe instead we should try investing in this area (reducing the burden on services)
This doesn't require any investment or technological development; it just requires making rational-but-politically-nuclear policy changes reducing the infinite tap of publicly-funded extremely-low-ROI medical expenditures on old people.
An absurd fraction of medical spending goes to protracting the suffering of old people just a bit longer. We can simply stop doing that, given the political will to do so.
Extending people's lifespans won't do much to alleviate these expenditures, except perhaps to slightly dilute the amortization schedule.
As an American, I’m often that countries like Denmark are in fact constantly investing in health and entitlements, and so everyone is healthier and happier. Is that not the case?
We have the same problem as every other western country. Sweden has lowered the taxes by about 500 billion SEK (corrected for inflation and population growth) since I was born close to 40 years ago. That is about a third of the annual budget.
How these tax cuts are distributed over the population is... not very evenly. There was even an article yesterday in the NYT (iirc) that warned about wealth accumulation patterns in Sweden.
It is the same neoiberal experiment that the US has had since Reagan, just with some more social democracy.
In my part of the Nordics (Finland) they are cutting investment and sending people to private institutions. In rural areas private providers have entirely replaced public sector healthcare centers. This is seen as quite controversial across the board.
Denmark has a lot of social services, and commensurate taxes to support them. This is reaching a breaking point. You can't get more blood out of a body that has already been drained to near the point of death.
Average lifespan is 81 in Denmark and 78 in USA. During the pandemic, average USA lifespan dropped to 76, while in Denmark it didn't drop below 81. So yes, it seems they are in fact healthier.
Denmark is not constantly investing in health and entitlements at all. On the contrary unemployment benefits and such has been slashed. Over the last two decades there has been many broad cuts to public services. The health sector had to do percentage fixed cuts every year for several years in a row.
Building on that, instead of viewing retirement (age) from a cost perspective (i.e. we have x budget and y lifespan, hence retirement age is z), it would be refreshing to see a high-quality and long retirement as starting point, and then figure out how to organize for that. One way would be to reduce burden on services indeed. A low retirement age (for those who want it) is a sign of a wealthy nation and something to strive for.
It’s not just about expanding lifespans. The cratering birth rates are a huge reason why societies are going to need people to work until they’re older.
No. I am suggesting that governments invest more into ensuring their aging population is healthy instead of draining every bit of life from them by making them work later and later.
I’d encourage thinking not just about yourself or your immediate circle when it comes to policy like retirement age. State run pension systems affect nearly everyone, not just the extremely fortunate few who can become financially independent at a younger age. And that is also largely an American phenomenon anyway. Salaries are much lower on average than in Europe and there is far less differential between minimum wage and what senior employees get paid. There’s also not the same culture of investing because European companies don’t have the same performance as the US stock market. Lower yield real estate investment is much more common in many European countries. And with strong social safety nets Europeans are generally less pressured to save a huge nest egg.
So this raising of the retirement age will affect a huge portion of workers and 70 is OLD to be working full time for all but the most relaxed jobs. Most older folks I know have know being dealing with multiple chronic age related illnesses well before 70.
It's a financial goal that is literally based on how long you plan to live, aka, your age.
Let's say I have €100.000 in the bank and that's two years of expenses based on my budget. Can I retire tomorrow? Well, what's my age? and what X do I plan to add to my age to determine if that amount of money is sufficient to retire?
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Looking at older people around me, most lead a much less active life after 75. So, if we were lucky we used to have some 10 good years of doing whatever we wanted before old age and age-related diseases start affecting us so much we become limited to a much smaller world. But now we have maybe eight years and if we follow Denmark, five years.
I think if you've put in 40-45 years for the man, you should be allowed to have some good 10 years for yourself. Travel, play golf, cross a continent in a camper or climb a mountain.
If you were born in the 70s, you should have known for most of your adult life that your normal retirement age is likely going to be around 70. The demographic situation is not new, the solutions have been discussed extensively since at least the 90s, and countries that take the situation seriously have implemented several pension reforms since then.
You are not going to be as wealthy in retirement as you are now, at least not on the mandatory pension alone. Your health is probably not going to be as good. If you live in Sweden, you should have plenty of vacation. If you think you would enjoy travel, golf, or climbing a mountain, you should do it now. It will probably be easier and more affordable now than in retirement, which may never come.
Improved health so we can all work more is kinda stupid.
It's actually far closer to a "vacation", but not "sponsored by the government" -- closer to "that you've been saving for already for years."
Then why is it based on earnings? And why can't I opt out of this death pledge?
> Your health is probably not going to be as good
Ah, the old, "your life will suck anyways" play.
> you should have known for most of your adult life
That you are a slave to the state, until you cannot work anymore, and then you will be discarded brutally.
Hard to figure out why the younger generation doesn't want to buy into this.
So now the young generation is expected to pay longer and longer for retirees, who have a higher median revenue and a higher standard of life than the active workforce (per all studies). There is absolutely no way I'm working until 70 to finance errors from the past without a contribution from our current retirees' wealth. There is anyway no foreseeable future with work for everyone until 70 with our current technological progress unless you want to slave everyone in bullshit jobs. All of this is madness.
Who are you talking for? I think plenty of people would prefer it to be that. We should respect our elderly, as a society.
But you pay for it all your life, so it's unfair.
It would be better to manage your own retirement funds, invest it and retire when you want, free from the government.
If you had the chance to find a nice job that paid well and played your cards right it definitely is, why do we need to pay high pensions to people who own multiple properties, have millions on the side and could EASILY thrive just from their passive income ?
[1] https://www.theatlantic.com/business/archive/2014/10/how-ret...
And we make it hard for younger adults to make time for this. Don’t work yourself half dead by the age of 30 and you will never have secure housing in any major city (where incomes are highest).
A huge part of it is cars. Most people over 70 shouldn’t be driving but we have had these people who have been driving everywhere for 55 years. They lose all ability to function independently in their community.
Give me sitting in a cafe living in an apartment with stairs and no car in Lisbon or Athens or similar any day of the week once I am old. Better than the old folks home.
But life expectancy at birth is not the same as life expectancy after hitting working age.
In 1900, if you made it to 10, on average you’d die at 63, meaning plenty lived well into their 70’s.
http://www.jbending.org.uk/stats3.htm
Retirement depends on having young workers. People approaching 60, 70 simply didn't have enough kids to have good retirement. It's not a problem that has easy and/or fast solutions. Yet, actions have consequences...
You've created an impossible situation which will never exist and then offered it as an example of why taking care of the elderly, something humans have done since before recorded history, is flawed.
As Bill and Ted would say: Bogus!
So, lack of young workers is not an inherent problem – you can invest your superannuation overseas (most funds invest a certain percentage of the money overseas, but if you want to take the risk of putting 100% of your superannuation into international investments, that's allowed), so even if the Australian economy were struggling with lack of young workers, you could still live off the investment returns from other global economies which lack that problem. And the reality is that Australia is unlikely to run out of young workers, because even though we have similar problems with low fertility as many other Western countries (although significantly higher than most of Western Europe), we've also always had a relatively high immigration rate, so younger workers immigrating makes up for the insufficient births.
It's most appropriately a shared investment scheme. Your pension money should not sit idle while you are building it. That money can earn a percentage in many ways and dividend reinvestment makes the fund grow massively.
> Retirement depends on having young workers.
Profits do. Retirement is going to happen regardless of how many young workers there are.
They just need to be calibrated that the years of pay-in and years of pay-out are balanced as to the ratio of the people in the age cohorts. If you have 10 people paying in for 40 years and only 2 people receiving pay out for 10 years then the system is cheap.
Except if you take a portion of the contributions and investment in incoming-producing assets.
Kind of like what the Canada Pension Plan (CPP ~ US Social Security) does.
Not all pensions are the same or created equal.
I don't think ponzi scheme is justified, it is too negative, it just makes no sense to actually accumulate all that wealth for so long.
Do that today. Tomorrow isn’t promised, let alone 10, 30, 50, 70 years. Don’t be one of those “When I retire”-people, do it now. _If_ you make it to retirement you may not be physically able or willing to do things you’ve been dreaming of for so long.
If you are waiting for retirement, then you are not living.
Not unless you've raised 2 more workers to pick up the shovel while you're playing golf. You could, of course, rely on your neighbor's kids through taxes and pensions but when your neighbor thinks the same it becomes problematic.
On the plus side, if you did raise kids, you may negotiate your retirement with them even if the averaged government system stops working.
2. These ages only affect a minimal government pension, and a massive tax saving on cashing out a specific, government approved retirement investment. If you wait to start receiving payments on that till retirement age, you avoid paying income tax of it. You can start earlier with worse taxation, or use regular investment types altogether. The overcomplicated tax system and its incentives are quite broken though.
3. Danish politicians still have a retirement age of 60 and a massive retirement package, so they can't deem retirement age and available funds to be that important...
Who do you think would "allow" this? God? This is a resource constraint imposed by reality itself catching up to an excessively idealistic set of policies; this policy decision is downstream of that, not arbitrary.
I don't think we should have ceilings, but we certainly should have floors. Minimum standards. Despite that belief, I think there is something wrong when there's about 20 people who make more money while they take a shit, than most American families make in a year[0] and a buttload who make that same amount while they're asleep[1]. These levels of wealth are so large that they are extremely difficult, if not impossible, to spend within several generations, not just one lifetime.
This is only a problem, because the floor is lowering while the number of people in these groups are growing, especially the shit group.
If we have to make trades between ceiling and floor, I'd rather sacrifice ceiling for floor than floor for ceiling. Because the latter is simply greed.
Importantly, we can have both. This isn't a zero sum game, we produce more wealth and resources as time goes on. It is only zero sum at a single point in time. We can simultaneously raise the ceiling and the floor. But currently, we are shifting what percent of these gains go to which groups.
It would be insane to build extravagant and ornate Cathedral ceilings to only have a dirt floor. It would be dangerous to build those ceilings without ensuring there is a strong foundation and forgetting to build the pillars to support them. Without that, the ceilings fall and it all becomes dirt and rubble.
It is an allocation problem, not an amount problem.
[0] If you have $100bn, are able to make a conservative 0.05 yearly interest and take 5min to shit, you've made ~$50k during that time.
[1] You only need $1bn given the same statistics, but closer to $45k. There's over 3k billionaires.
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With the high salary, even if the cost of living around you is high, you can still make choices to save and invest money to eventually become financially independent and retire when you want, where as if you have a low salary, you don’t have that flexibility, you are at the mercy of the systems around you.
Think where you are going to invest and how that investment is going to provide returns. Stocks? Those companies actually need to produce and hence need workers. There also needs to be a broad consumer class to purchase those products. Without younger generations, you have no workers and no consumers which means your stocks have no value. Same with bonds. Same with real estate.
You can fill a gap before that pension starts with part time work etc. It’s much harder to make up a shortfall when you’re 85.
Or look at ancient egyptions, they very clearly didn't need to work 90% of the time if they got time to build massive pyramids, and there is considerable evidence that pyramid workers were not forced to work, but simply offered extra booze and food for doing so. If you didn't work on those projects you weren't starved to death, you just didn't get to drink as much alcohol with your buddies or brag about how you helped build a wonder that will stand for hundreds or thousands of years.
This is not true at all. A quick google for “hunter gatherer work hours” would tell you that they worked far less than we do today. 2-5 hours of what we would define as work a day, with the rest being mainly leisure.
Idk if you've ever seen sheep in person, but "standing near some sheep while they eat grass" is not work in the sense of effort, concentration, labour. There's a reason the Boy Who Cried Wolf was bored out of his skull, and why shepherding was a task given to a boy while the village adults were doing other things.
Another idea: Allow people to retire early, but they receive lower monthly payments from national pension. Most national pensions have the reverse: You can retire later and receive higher monthly payments.
The problem is that huge number of people live way longer than 75, like to 85 or 95 and such, which imposes a huge financial burden on the state (pension and healthcare costs).Maybe we need to start thinking about these things differently. I would love to have more time off but still have a job and not need to make this so binary.
Here in Australia, and I imagine elsewhere, there are strong systems (e.g., superannuation) to encourage personal savings towards retirement.
The generation they belong to are predicted to live to what 80-85 years? Whilst we (assuming you're in your 40's now) are predicted to get to what 90-95 on average?
Average lifespans are increasing, and on top of that the mobility of someone who's 75 now, won't be the same of someone who's 75 in another 35+ years.
Barring some revolutionary technological breakthrough, we aren't going to be living, on average, into our 90s.
[1] https://www.ssa.gov/OACT/NOTES/as120/LifeTables_Tbl_10.html
My impression so far is that we've done a lot of work at the lifespan, less at the healthspan. What's the point of living until 90 if the last 15 years isn't that fun at all.
Also, people age differently. There's a difference between living and being alive.
Not that it's an easy problem to solve, what with the demographics being what they are. I think we'll have to get used to the thought - and reality - of sinking living standards in the west.
That may be true, but will we (who are in our 40's now) have the same quality of life at 90-95 as a now 75-year old will have at 80-85?
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As an American, I can’t realistically retire until 65.
65 is when Medicare is available.
I’d prefer Medicare started from 21 paying out-of-pocket as an option; then the payment starts slowly phasing out at 65. Not this abrupt, all-or-nothing.
That point might be reached earlier for some people, e.g. those who have a hard physical job, than others and a general retirement age is an approximation for when that point is reached for the general population.
But my solution is to be an entrepreneur and also avoid working whenever possible.
So If I stay here and I need to work in my 70's, at least I will be happy I didn't work in my 30's like a slave.
Don't you get a whole month of vacation every year while you are in your working years?
In many Western countries, younger people are facing the prospect of never being able to own a house and never being able to retire. Beyond this basic lack of security, people are realizing the cost of having children is absolutely astronomical. In many parts of the US childcare may be costing $3000/month or more per child.
For many people, pets are proxy children, and yet capitalism (private equity in particular) is ruining that too as all the vet clinics are being bought up so people can be gouged on that front too.
I'm someone who views the Labor Theory of Value [1] to be trivially true. After decades of Red Scare propaganda, Americans in particular dismiss Marx but they don't realize that Marx's most famous work (Das Kapital [2]) is primarily a framework for economic analysis, regardless of your political beliefs. I guess the problem is that as soon as you accept the axiom "there is no value without labor", there is no other conclusion than to see capitalism as the exploitation of surplus labor value.
The US corporate sector produces something like $4 trillion per year in corporate profits [3]. There are over ~210M working age people in the US [4] (about ~262M adults total). So that's ~$20k per worker in surplus labor value at a time when we spend ~2x per-capita on healthcare for worse outcomes and less coverage [5], housing is artifically expensive because we allow people to hoard it and education is unjustifiably expensive.
None of this has to be this way. We've simply chosen to prioritize the interests of fewer than 10,000 people at the expense of everyone else. People need hope. They need their basic necessities taken care of. They need something to live for. We're rapidly heading towards a future where only the rich survive but there's no one left to work in their sprawling estates.
It's also wild that we're seeing the rise of fascism in the West while there are still survivors of the Holocaust still alive. This is absolutely true in Europe too (eg AfD, Reform, National Front, whatever Hungary is). I also think we've passed the point of being able to resolve this with electroal politics. Now it only ends in tyranny or revolution.
[1]: https://en.wikipedia.org/wiki/Labor_theory_of_value
[2]: https://en.wikipedia.org/wiki/Das_Kapital
[3]: https://www.stlouisfed.org/on-the-economy/2025/apr/whats-dri...
[4]: https://fred.stlouisfed.org/series/LFWA64TTUSM647S
[5]: https://www.oecd.org/en/publications/2023/11/health-at-a-gla...
It’s absolutely insane that technology and productivity are increasing so rapidly, yet we’re talking about raising the retirement age and people being increasingly unable to afford children.
Something is incredibly wrong here.
Running a car at highway speeds into something or someone else has a much higher chance of injuring or killing multiple people besides the driver.
Not saying this is a great trend, but it’s unavoidable due to the low fertility rate (already a problem everywhere in the developed world and soon to be a problem the world over, as by 2050–before I retire—the global average total fertility rate will have dropped below replacement.).
1. I've never had more than a max 2 year time horizon when thinking about a hire.
2. If anything, I've found younger people more likely to job hop than those 40+.
Not that that stops managers, of course...
My pet theory is that when the system becomes untenable, procreation slows down, which will in time trigger a kind of reset - not that it's going to be fun to live through or anything. Self-regulation.
Sorry but how is this different from hiring someone in their 20s and they are very likely to job hop to another company 1 / 2 years later ? I don't think anyone will believe this.
Cut all things that promote or enable public health.
In neo-feudalism, only lords and perhaps some of their most favored serfs, deserve private for profit health care, and the barrier to entry is cost. Why be wealthy if you can’t buy things other people can’t?
There’s always a surplus of peasants in this model.
Almost every single industrialized country has a birth rate below replacement, so there's fewer younger people to help carry the burdens. Medical care means the elderly live on and on and on, draining enormous costs as they age.
I'm not trying to be cruel, but from a pure numbers sense it makes perfect sense. Would you prefer taxes go up instead? Lessen spending on infrastructure and healthcare? Lessen child labor laws? There's no a lot of winning answers here.
And overall, the problem is just going to get worse in every country for the forseeable future. Expect to see more of this as time goes on. It's a bandaid solution though.
E.g. look at Ireland. Ireland has a de-facto wealth tax ("deemed disposal" - taxing the unrealized gains) on ETFs starting at the first euro, which makes investing basically pointless. Meanwhile it also has one of the lower tax levels on property in the EU.
With power, comes the ability to change systems so those with wealth/power do not lose it.
There are exceptions, but that is the rule.
And you only get to do that once.
The solution they are applying now is a dead end, literally. It doesn’t scale, the only place it leads to is people guaranteed to die “at work”.
And elephant in the room, people in their late 60s aren’t even close to productive compared to the younger employees and if you lose your job in your 50s or early 60s you’re condemned to a decade or 2 of being supported by the family if you’re lucky.
So a person in this position is a hidden “tax” on the tax payers in the family, or on the companies who still employ them, if any still have them at that age. Countries are better off just directly taxing the companies regardless of whether they hire 70 year olds. But that won’t happen.
2) Consume more
3) Have less kids
4) Live longer after the retirement age
Productivity increased a lot but expecting it cover all four is way too optimistic.
Yes.
He retired last year. He didn't have an easy life. Very few jobs would benefit from his work and continuing working would have a great toll on him.
Yes. Looking at my country, we've applied economic liberalism without any positive results at scale. I would prefer we go back to taxing companies more, go back to taxing the rich on their assets and crack down on fiscal fraud (20B€ estimate, about 6% of the national retirement cost).
Instead the government privatizes services that used to bring a steady income and defunds hospitals, education and public research.
Long term: incentivize to have more kids.
this will solve the problem in ~25 - 30 years.
but that's too late for most voters and politicians today...
there should be a term for that? how about democracies demographics dilemma?
There does not seem to be a strong correlation between countries which make it easier and more affordable to have children, and the replacement rate.
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Those costs continue, and now you have fewer young people to pay for it - and more elderly that will need assistance. It is vicious.
Some countries like the US have skirted past this problem due to immigration. Others like Japan have not have much immigration and are beginning to suffer the effects.
But every country will face it in the long run.
The cold hard fact is that when people are educated and have access to healthcare, they simply stop having enough kids to meet replacement rate - even when wealthy and when having great support systems.
Humans do not act like most species. We do not form neat equilibrium with our environment based on available resources. That kind of logic didn't apply the moment agriculture was developed.
It's not an unfunded mandate running on deficit spending.
So probably it won't be wiped away by a global monetary crisis that forces us to cut deficit spending and reduce pensions.
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The highest total tax rate in the world perhaps?
Denmark is like all the other Nordic countries culturally, except they have much easier direct geographic lines to Central Europe. So it’s basically what you get when you combine the Nordic model (tiny homogenous Lutheran population) with more advantageous geography. Finland is Denmark with extremely unfortunate geography.
Societal coherence has been aided by the isolation, and here is the hot take: this cannot exist in "diverse" societies. Not because of bullshit genetic superiority justifications, but because no diverse society has so far demonstrated the capacity to have a shared purpose, coherence and high degrees of trust.
And yes, I do find monoculture societies (including denmark) very boring, and I believe diversity has other great benefits. But societal stability and long term prosperity in that sense? Doesn't look like it.
Before someone mentions the US as a counterexample, do not forget that all the prosperity of the US came from basically seizing an underutilised (in the industrial sense) resource rich continent, and now it is falling apart by internal divide.
I don't know much about Denmark but somehow I doubt that this attitude extends to taxing rich pensioners more (since they didn't contribute enough).
I feel they could do better than that with all this wealth.
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Denmark’s economic prosperity comes from investment in free higher education for all, generally healthy lifestyles and the flexicurity-model, which provides a flexible labour market and promotes risk-taking.
How does the US compare / contrast?
Extending the retirement age doesn’t really help the situation much, as you need younger and cheaper pilots to fulfill the roles of pilots who are retiring.
The problem is, becoming a pilot takes a fair amount of time, over $100k in training fees, low pay for a while until fully certified with hours in, a very mobile lifestyle, and now you are subjected to physical as well as mental demands of the job certification standards.
The obvious one that comes up in every discussion is thinking that unions will protect their jobs from being outsourced to other countries. People like to layer various more palatable explanations on top of this to make it sound better, but when you ask them if the employees who receive the outsourced jobs should get the same union protections you usually get their real motivation: They want to keep the jobs local to their own market and exclude foreign labor supply in order to improve demand for their services (and therefore their leverage, and therefore their own wages)
It gets interesting when different demographics start imagining that their ideal union would protect them from other demographics: Commonly, older people like to think of unions that will protect them from losing their jobs to young people.
Then when I’m working with college students and they start discussing hypothetical unionization, they come up with ways to think the union will give them more jobs by protecting them from the old people “hoarding” the jobs. (Sorry, that’s the least likely outcome for a union)
What’s most interesting is that the people I know who are in unions (non-tech industries) don’t hide the fact that decreasing labor supply to increase their own demand is exactly what they expect from a union. The first time you hear someone complain that a non-union worker is “taking food off their table” by simply doing their job you realize that it’s not as simple as Unions versus Corporations like we’ve been led to believe. The Unions are advocating for the people in the union, not workers everywhere.
Even the cost of PPL, the lowest license on the path, is around $10,000 while the ultralight (European)/sport pilot (US) is over $6,000. From that you need CPL (commercial), multi-engine, complex aircrafts, instrument rating (bad weather or night) etc., that takes time and money most people cannot afford.
It can have its place, i.e. a way to balance bargaining power with the employer. It’s inherently anti meritocratic though.
In some cases it’s not about merit or about limiting supply however. In some cases it’s impractical to test someones work continuously, so instead it becomes honor based. That is, you are expected to go through an elite track and succeed in an exam once and then you are good for life unless you commit fraud or show gross incompetency.
https://freakonomics.com/podcast/is-professional-licensing-a...
I think the system has failed at this point, when you are expected to work that long.
The Japanese faced this earlier and harder than Europe, with about 30% of their population being past the retirement age. They increased their productivity very significantly, but it's still not enough, and a lot of older folks in Japan keep working well past the retirement age, sometimes even re-hired by the companies from which they had retired.
Setting aside the issues of declining birth rate for a minute, this seems like a reasonable adjustment to the other factors?
There's the flip side if the coin though: old people are healthier in Denmark (vs US for example [1]) due to the social welfare system. Well, that system needs to be funded. With the aging population, the costs are rising but contributions are (relatively) declining. That's why there's a push for higher retirement age. It's either this, or defunding the social welfare programs, or immigration. That last one isn't a viable political option in Denmark at the moment.
[1] https://www.euronews.com/health/2025/02/05/older-people-are-...
This system was working back in 1860, but it is a Ponzi scheme in decline for the past 50 years. And there is no way out, most people rely on state pensions to live after retirement; it is the perfect trap.
If pensions were funded by actual retirement accounts, where employees invested money into some state fund and have it paid out for retirement this would be entirely unproblematic.
But the pension system in many EU countries is set up in a way in which tax contributions now finance pensions now. This can only work with a steadily growing economy which continually generates more revenue when more people retire. In some sense it is a literal Pyramid scheme, in which the obligations are continually pushed to younger generations, which have to contribute based on how many pensioners there are.
Especially now as EU economies become weaker this issue becomes bigger and bigger.
Their retirement savings can be in public company stocks instead of government guarantees but that only works if there are people willing to buy those stocks (ex: younger people saving for retirement).
Whatever you accumulate for retirement (cash, stocks, gold, state pension points) it only represents coupons for your share of the economy of the future. Details may differ but fundamentals are the same: it a promise that the future generation will share some of their yield with you.
You're talking about a system of pension by capitalization, like in US, which comes with its own problems.
Namely that if you reach retirement age during a crash like in 2008, you're screwed. You have to work 5 more years hoping the market recovers in the meantime, or retire anyway and get way less than you put in.
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Denmark has private pensions like the 401k system in the US.
People can start tapping into these up to 5 years before they are 70.
In reality most people will go down in time and partially tap into private pensions and saving long before they turn 70.
This is opposed to other European countries, like Germany, that does not have these private pensions, but only retirement insurance.
Hopefully US people realize that this is also how US public pensions (social security) actually works.
And this is the case in all western countries.
It is just being realized in different ways.
Fundamentalle there are 3 ways to cope
1. reduce pensions
2. Raise taxes
3. Decrease amount of benefit receivers.
Denmark choose number 3
- increase productivity more than how much the workforce/receivers grow.
And if AI/robots eventually deliver, we're soon going to need a discussion about lowering the retirement age to 55 or even 50 if we don't want 30% unemployment anyway.
Most don't want to so they have to compensate via taxes and higher pension age.
https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor...
In the places with high fertility rate, you will almost surely observe joint families. I'm from India where we have such demographic variety that you can see adjacent areas with completely different fertility rates. In one, you will see old-style large houses with courtyards and 15+ people in them living as a joint family. Invariably these people have more kids. But in the next town with more nuclear families and modernish apartments, you will be lucky to see 2 kids per family. [1]
This is what births the secondary economic incentives which are mentioned a lot in popular discourse. For example, if you're already living in a house with 15 people your financial realities will require a similar number of people in the next generation to continue the same lifestyle.
[1] Wealth is not a confounding factor here. The specific two areas I have in mind are both more or less equally wealthy, one has folks running a coconut business primarily and the other is a small town with the usual assortment of office jobs.
Of course, those last two sentences are tongue in cheek.
The real problem is that certain segments of society are not compensated for their labor at a rate that would allow them to retire early, and may even have to work beyond retirement age in order to supplement their stipend. Worse yet, these people often work in sectors that offer few affordances for them to maintain their health into old age and may even push them into living conditions that are detrimental to their health (assuming their job isn't detrimental to their health in the first place).
Ideally, people would be able to retire when they want (within reason). The reality is that some people can retire at a relatively young age while others don't really have that option.
Ha. Total pipedream. It is easier to imagine the end of the world than to imagine the end of our current economic system.
That people are living longer is why the system is failing. It's an interesting thought experiment to consider whether any country would introduce a state pension now knowing how much they cost.
Sustainable population and economic growth at that rate can't happen indefinitely.
Some people have been vocally saying this system in unsustainable long term, just that Europeans governments never wanted to publicly admit this due to fears of loosing elections, so they kept kicking the can down the road.
It’s not really a Ponzi scheme, it is completely possible for the system to be balanced, it’s just very very hard to get people to vote for you if you say they’ll have less tomorrow
They could have easily worked 10 years longer instead of doing nothing but drinking wine all day and/or going out to restaurants in retirement. That is in between traveling to go out to restaurants and/or drink wine.
The boomers scammed us all and aren't done yet. They are going to make sure to bankrupt the entire system with healthcare cost before they go.
In some rich countries people spend now more years of their life out of work than in work because of much longer education and much longer lifespans. If you want to keep the same social standards, all other things being equal, you need to raise the retirement age.
Or some may say it got outdated.
It was started at times when the life expentancy was low. And it was given at age above the life expentancy. And in the beginning not to everyone. The retirement age got lower and given to broader set of population gradually. These moves made governments popular, so it was no brainer to introduce, on the expense of future generations.
Birth rates that can maintain the economics of relatively low retirement age could not be sustained without destroying the planet. Actually has to be reversed still as it went too far already and deteriorating as we speak, especialy with the ongoing large increase in the overall life quality - causing decreasing birth rate alone - and healt. The system was destined to fail. But how to take away rights? It is much harder than giving, especiallly when the adverse effects are for current voters, not future generations?
So the necessary steps are postponed, postponed, postponed yet again, for many decades, taking about necessity in many forms, meanwhile filling bigger and bigger holes in the budgets, through borrowing, making the problem worse, again for future generations. Very few countries do tiny adjustments, and even those are met with huge protests mostly.
I wonder what the future holds. Painful adjustments or more painful collapse later in some form.
Maybe instead we should try investing in this area (reducing the burden on services) instead of simply trying to reduce the quantity of folks claiming from the state pension pot.
Now people live way longer, but the retirement age never got adjusted properly to the new reality. So 15-20 years of retirement is the new normal.
In addition, way fewer young payers for the now old.
https://www.gov.uk/government/statistics/pensioners-incomes-...
They'll go directly from factory line to care home.
I knew a guy who worked full time at a bank at 85. He said all the time he didn't have to work but what else was he going to do all day? A big reason he was able bodied at 85 was from working and not sitting home all day.
I think we have confused retirement fund/planning marketing with reality.
The retired people I know are physical mess from retirement. Alcohol and restaurant food all the time, will be needing long term care much sooner than if they had worked longer.
Only if they are poor. If they're rich, they can continue "producing wealth" from interest and investments even after they're dead.
It's a silly thing to say, of course, but it's built into most people's assumptions who are discussing it.
But it turns out young people become middle-age people, become old people, and we're all in this together. The real problem is not about how the pie is split across generations, but about the realities of lifespans, economic production, and expenses. If you're responsible for funding the entirety of your retirement, all of this is abundantly clear. When you nationalize retirement, all sorts of budgeting tricks start happening, like "borrowing" to fund other programs, papering shortfalls via population growth, etc. Then you start getting age warfare when the govt has to eventually cut back.
You could dissolve the national retirement plan, but that seems like a bad idea for similar reasons as entirely dissolving national welfare and insurance programs. It will always be the case that some people, need some help, some of the time. I guess in my ideal world, it's reduced to a much smaller safety net, because the government is managing the economy well enough that the populace has the wherewithal to save appropriately, and they are educated enough to do so.
Or a population that can produce the same amount of stuff and services with fewer and fewer workers. Fortunately that's what capitalism excels at.
This doesn't require any investment or technological development; it just requires making rational-but-politically-nuclear policy changes reducing the infinite tap of publicly-funded extremely-low-ROI medical expenditures on old people.
An absurd fraction of medical spending goes to protracting the suffering of old people just a bit longer. We can simply stop doing that, given the political will to do so.
Extending people's lifespans won't do much to alleviate these expenditures, except perhaps to slightly dilute the amortization schedule.
How these tax cuts are distributed over the population is... not very evenly. There was even an article yesterday in the NYT (iirc) that warned about wealth accumulation patterns in Sweden.
It is the same neoiberal experiment that the US has had since Reagan, just with some more social democracy.
https://countryeconomy.com/countries/compare/denmark/usa?sc=...
So this raising of the retirement age will affect a huge portion of workers and 70 is OLD to be working full time for all but the most relaxed jobs. Most older folks I know have know being dealing with multiple chronic age related illnesses well before 70.
It's a financial goal that is literally based on how long you plan to live, aka, your age.
Let's say I have €100.000 in the bank and that's two years of expenses based on my budget. Can I retire tomorrow? Well, what's my age? and what X do I plan to add to my age to determine if that amount of money is sufficient to retire?