France beats America
... at least when it comes to facing reality. From Bloomberg:
"French President Nicolas Sarkozy raised the retirement age and increased taxes to stem losses in the pension system, risking confrontation with labor unions as he seeks to safeguard the nation’s top credit rating. The retirement age will rise to 62 by 2018 from 60, Labor Minister Eric Woerth said today. The government will increase taxes on stock options, dividends and capital gains, and will raise the top income-tax rate a percentage point to 41 percent. The rules will apply to private- and public-sector workers. 'There is no trick,' Woerth told reporters in Paris. 'We can’t promise to work less, raise pensions and erase deficits.'”
You're looking at the future, folks, and the sooner, the better. For Social Security, Medicare, and pensions to remain viable, there will have to be a combination of higher retirement ages, higher taxes, and/or lower benefits. Let's at least start with the first one. If you want to retire earlier, save a lot and invest wisely. Otherwise, work until you're 70. It won't kill you.
Getting back to the article about France, moving the retirement age from 60 to 62 infuriated labor unions. One union leader said, “This is a brutal reform that represents social regression as never before.” Another said, “Moving the age of retirement is an injustice." All that from moving the retirement age up two years to 62?
OK, maybe France doesn't have us totally beat.
Robert Brokamp is the senior advisor for the Fool's Rule Your Retirement service.