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If you haven’t heard, Social Security trustees now state benefits will deplete to 78 percent in 2033 if no action is taken. As a result, Democrats are attempting to find a fix that both parties can agree on, but only time will tell if these initiatives move forward.
No simple solution: Also known as the Social Security 2100 Act, this bill proposes that the Social Security Administration extends their set depletion deadline by five years to 2038, in hopes of providing Congress with more time to find a long-term solution. Additionally, the bill aims to increase Social Security benefits across a variety of avenues, some of which include:
📌Pay-outs for low-income workers would be set to 125 percent above the poverty line
📌For cost-of-living increases, the bill proposes tying benefits to the Consumer Price Index for the Elderly (CPI-E), rather than the general Consumer Price Index (CPI)
📌Increasing certain widows’ and widowers’ benefits
At the same time, this new bill also eliminates former proposals and rules which brought on mixed reviews from Congress. Some of those include:
📌Replacing the solution of a higher payroll tax rate by increasing Social Security taxes paid by higher-wage earners
📌Nixing the five-month waiting period to receive disability benefits
📌Repealing a rule that reduces Social Security benefits for public workers and their spouses, widows or widowers who also have pension income
Bottom line: There will be changes to Social Security, but they won’t be drastic by any measure, and will certainly once again kick the can down the road.