Social Security Claiming Reform Moves Past House Committee
The House Committee on Ways and Means has advanced legislation that would make changes to Social Security terminology utilized in rules, regulation, and guidance.
The bill, named the “Claiming Age Clarity Act,” was advanced in a vote of 41-1. If passed, it would substitute terms like “full retirement age” and “normal retirement age” to “standard monthly benefit age.” It would also replace the term “early eligibility age” with “minimum monthly benefit age,” and reject the term “delayed retirement credit” to be swapped with “maximum monthly benefit age.”
RELATED – Social Security Bill Proposes Changes in Terminology
The bill seeks to provide clarity on when seniors can claim benefits for Social Security and modernize the terminology associated with it. It also hopes to deter future beneficiaries from claiming at an earlier age so individuals can maximize on their benefits. A study from United Income found that the average Social Security recipient would receive 9% more income in retirement if “they made the financially optimal decision” on when to claim benefits.
The bill was introduced to the committee earlier this month by Reps. Lloyd Smucker (R-PA) and Don Beyer (D-VA) and was presented by Sen. Bill Cassidy (R-LA) in the Senate in April.
“Older Americans approaching retirement age should make informed decisions when deciding to claim the Social Security benefits they have earned. This straightforward legislation aims to simplify bureaucratic jargon which may mislead Americans into making poor financial decisions,” said Rep. Smucker when first introducing the bill.
The legislation has received support from the Bipartisan Policy Center Action, AARP, and the Association of Mature American Citizens (AMAC) Action.
If passed, the bill would begin making changes to the terminology no later than Jan. 1, 2027.
Studies show that while confident, individuals remain confused over when they can begin claiming Social Security benefits. Financial professionals in a July report from Protective Life Corporation say they’re clients have felt confused, skeptical, and anxious when devising a plan to claim benefits, and one-third of individuals admit feeling unsure on when they can claim.
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.
