John Waggoner has written an article for the March 2022 issue of AAPR Bulletin. The tile of the article is “How to Keep Social Security Safe and Strong”. Many seniors are concerned about the overall health of social security, especially if social security is their sole income source. The current trend for the fund is downward, and some predict the fund will be broke in 12 years (2034).
This issue has developed over time, as payments in do not meet the benefits paid out. Payments are not only made to seniors and survivors, but to many disabled citizens as well. We are all living longer than it was originally predicted, resulting in more money being paid out to individuals. The major drain on the fund is from life expectancy being longer, survivors living longer, and more disabled persons. Couple that with the number of baby boomers that become eligible daily, and it is an overwhelming situation.
Congress has the control of social security and both parties realize that negative changes will be met with overwhelming opposition. There are very difficult proposals put forth to meet the promise made to working people after retirement. Below is a list of some the difficult choices congress is dealing with, as well as possible solutions, none of which are very appealing.
- Increase the current payroll tax
- Introduce a more progressive benefit – basically the more you make could reduce your benefit to protect those who have a lower annual income
- Cut the benefits for new recipients (lower than promised)
- Reducing the cost-of -living adjustment that is made annually – that adjustment is already below the annual cost of living
- Adjust benefit calculations that will have a very negative affect, especially on those who are about to retire
- Up the retirement age again
More information on the social security status next week.