Former presidential candidate Senator Elizabeth Warren, D-Mass., took to CNBC on Saturday to advocate for a “temporary” increase in Social Security benefits as part of a Congressional stimulus package to aid in coronavirus relief.
Her op-ed, co-authored by fellow Democratic Senator Ron Wyden, Ore., noted that older Americans are “scared about the future as they watch their retirement savings disappear as the pandemic shocks the U.S. economy.”
The politicians proposed a $200 increase in the monthly benefit for all Social Security, Veterans, and Supplemental Security Income (SSI) beneficiaries through the end of 2021.
“This will put about $4,000 in the pockets of seniors and people with disabilities who have earned this benefit by contributing to Social Security with every paycheck,” they wrote. “A simple benefit increase like this will improve the lives of millions of Americans and help our economy stabilize and recover.”
Claiming Senate Republicans’ proposal “only provides half-benefits for individuals who need these checks most, like seniors on a fixed income or those who pay very little or no tax,” they added that expanding Social Security and other benefits “will be a more stable and reliable source of support for these seniors and the economy as public health officials work to contain this virus.”
A one-time $250 benefit was sent to Social Security and SSI recipients after the 2008 economic crisis as part of the American Recovery and Reinvestment Act.
“When the economy is in a downturn, getting it moving back in the right direction requires Americans to start spending money and researchers have found that permanent Social Security benefits increases have a ‘large, immediate, and significant’ positive impact on spending,” Warren and Wyden concluded. “In fact, there is a nearly 1:1 ratio between an increase in Social Security benefits and an increase in consumer spending. That provides an enormous boost to the economy—and it starts with the very first month of increased benefits.”
Social Security stats and facts
According to the Social Security Administration:
- The average Social Security benefit was $1,503 per month in January 2020. The maximum possible Social Security benefit for someone who retires at full retirement age is $3,011 in 2020.
- 9 million people received Social Security benefits in 2018.
- Of those, 5.6 million were newly awarded Social Security benefits in 2018.
- Women represent 55% of adult Social Security beneficiaries in 2018, and seven in 10 beneficiaries in their 90s. In addition, women make up 96% of Social Security survivor beneficiaries.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
