Recession forces early Social Security filings
Paul Skidmore, with his wife Kathy in the background, stands at his home in Finksburg, Md. Unable to find a job, he plans to file this week for Social Security benefits at age 63, three years earlier than he had planned. (Aug. 5, 2010 ) Credit: AP
MIAMI - Paul Skidmore's office is shuttered, his job gone, his 18-month job search fruitless and his unemployment benefits exhausted. So at 63, he plans to file this week for Social Security benefits, three years earlier than planned.
"All I want to do is work," said Skidmore, of Finksburg, Md., who was an insurance claims adjuster for 37 years before his company downsized and closed his office last year. "And nobody will hire me."
It is one of the most striking fallouts from the bad economy: Social Security is facing a rare shortfall this year as a wave of people like Skidmore opt to collect payments before their full retirement age. Adding to the strain on the trust are reduced tax collections sapped by the country's historic unemployment - still at 9.5 percent.
More people filed for Social Security in 2009 - 2.74 million - than any year in history, and there was a marked increase in the number receiving reduced benefits because they filed ahead of their full retirement age, which rose last year from 65 to 66.
Nearly 72 percent of men who filed opted for early benefits in 2009, up from 58 percent the previous year. More women also filed - 74.7 percent in 2009 compared with 64.2 percent the previous year.
Jason Fichtner, an associate commissioner at the Social Security Administration, said the weak economy has led more people who lost their jobs to retire early. However, it also has forced some people hard-hit by the recession and in need of a bigger paycheck to push back retirement and stay in the workforce longer. "But we're seeing more people taking early benefits than staying in the workforce longer," he said.
In the annual report of the Social Security program released Thursday, the trustees said that pension and disability payments will exceed revenues for this year and 2011, reflecting the deep recession.
The report forecast that the program would return to the black in 2012 through 2014, but that benefit payments will again exceed tax collections in 2015. For every year after 2015, the report projects that Social Security will be paying out more than it receives in tax collections as 78 million baby boomers begin retiring.
