Planning to Retire

In Social Security history, the age at which a worker can claim full benefits has increased only once—in 1983. The rise from age 65 to 67 was phased in over more than 20 years. As things currently stand, those born in 1937 or earlier get their full due at age 65, everyone born in 1960 or later can't claim full benefits until 67, and employees between those years can find their full retirement age here.

The American Academy of Actuaries says it's time to raise the retirement age again to keep up with ever increasing life expectancies. In 1940, men who reached age 65 typically lived 12 years in retirement and women just over 13 years. In 2007, those ranges were almost 17 years and 19 years, respectively. And Social Security Administration actuaries predict that life expectancy at age 65 could further increase to almost 19 years for men and 21 years for women by 2040—which is seven to eight more years of retirement that will need to be financed.

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At first, retirement might be like a vacation. No alarms clocks, no commuting, no meetings or bosses. But some people who retire actually miss the office and want to return to work at the same company. No so fast! About half of companies have rules in place that don't allow you to waltz back over to your old desk and reclaim your paycheck and benefits after you've officially retired.

A new survey of more than 140 midsize and large employers by the human resources consulting firm Hewitt Associates found that 45 percent of the companies surveyed have restrictions in place that limit the ability to rehire previously retired employees. Common policies include a minimum period of absence (typically six months or less) before an employee can be rehired (42 percent), a limit on the number of hours a retired employee can be re-employed (31 percent), or allowing retirees to return to work only as employees of an outside contractor or leasing agency (29 percent).

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Most seniors can remember a time before their family purchased a television. The first commercial sets hit stores in 1928, but it took over a decade for them to become household items. And even 20-somethings can recall life before every public gathering was interrupted by someone's cellphone belting out pop music. But two organizations are worried about our elders' access to mobile phones and television.

Mobile security. Cellphones can be a lifeline for seniors living alone. A single button push can connect anyone who has experienced an accident, a sudden health problem, or a crime situation with help. The nonprofit Seniors Coalition says that older consumers can best take advantage of the "cellphone security blanket effect" by wearing a cellphone whenever it's not being charged—even around the house—and preprogramming the phone with key numbers to emergency services and their doctor, pharmacy, and adult children. Seniors who plan to use the phone only for emergencies can avoid pricey cellphone contracts that start at $30 to $40 per month by using low-cost prepaid cellphones for as little as $15 and prepurchased minutes for $20 or less for three months. U.S. News technology blogger David LaGesse recently tested four cellphones for seniors.

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A 2006 law that made it easier for companies to automatically enroll employees in 401(k) plans went into effect late last year. And, indeed, employers have changed their retirement offerings.

A new online survey of 436 plan sponsors by Deloitte, the International Foundation of Employee Benefit Plans, and the International Society of Certified Employee Benefit Specialists offers a snapshot of current 401(k) participation.

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