With Social Security beneficiaries projected to face a 23% cut by 2033, urgency is building for fixes to extend the troubled program’s solvency
Unless Congress stops kicking the can down the road and actually musters the will to do something about it, within a decade all Social Security beneficiaries will face a 23% automatic cut. That would reduce the average annual benefit by around $6,000—or $500 a month.
The Social Security Board of Trustees annual report released at the end of March revealed that the Old-Age and Survivors Insurance and Disability Insurance (OASI) trust fund, which currently pays benefits to about 57 million Americans, will become depleted by 2033 unless changes are made.
A recent PlanGap survey found “Americans are growing angrier and more scared that the government may be unable to pay their Social Security benefits in full.” Seven in 10 at or near retirement do believe benefit reductions could occur in the United States, and 84% feel frustrated or afraid that decreased benefits would have a negative impact on their retirement plan’s success. Only 9% express hope that the government will mitigate Social Security funding challenges without reducing benefits.
“Americans have watched the protests in response to benefit reductions in France, so it is no wonder 7 out of 10 people, at or near retirement age, believe benefit reductions could happen here,” said PlanGap founder and CEO David Duley. “Social Security is a significant source of income for 90% of retirees, and its uncertain future is naturally leading to fear, frustration, and doubt among the American public.”
While everyone has long known Social Security is on an unsustainable path, the urgency among lawmakers to finally address the impending crisis finally seems to be increasing. President Joe Biden and Republicans have recently made pledges not to make cuts to Social Security but a variety of proposals—including some in the form of proposed legislation—are being brought forward by lawmakers. Here’s a look at some of the more notable ones.
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You keep saying the wealthy pay a less percentage than the waitress. But you don’t point out that the wealthy’s S.S. payment is capped at a maximum like everyone else. If you make 200k a year or 2 million a year, you don’t get any more increase in benefit. The benefit is based on that capped taxable amount of $160k. This is FAIR. Unless you see S.S. as a welfare plan – which of course Bernie & Pocahontas do!
As someone concerned about the future of Social Security, I believe that implementing gradual increases in the retirement age is a crucial step towards fixing the system. After reading the article “3 Proposals to Fix Social Security,” it became clear to me that adjusting the retirement age is a practical solution to ensure the program’s long-term sustainability.
Considering the rising life expectancies and changing demographics, it is necessary to make adjustments that align with the current reality. By gradually raising the retirement age, we can address the challenges posed by an aging population and ensure that Social Security remains viable for future generations.
This proposal recognizes the significant improvements in healthcare and overall quality of life that have resulted in longer, healthier lives for many individuals. It acknowledges that people are now able to work and contribute to society for more extended periods. Adjusting the retirement age would reflect these societal changes and distribute the financial burden more evenly.