Social Security Matters by Rusty Gloor, National Social Security Advisor at the AMAC Foundation, the non-profit arm of the Association of Mature American Citizens
Dear Rusty: Politicians talk about taking money from Social Security, but I need that money to support my daughter and pay for my home. I am a widow and my husband passed in 2017. I will lose my home if my social security benefits are cut. Please help. Signed: Enke Senior
Dear Widowed Senior: Despite what you may read or hear in the media, the biggest threat to you losing any of your Social Security money is if Social Security is not reformed. In that case, everyone receiving benefits would see a roughly 23% cut in their monthly benefit starting around 2034. The way to avoid that is by updating the current Social Security law to address two primary issues:
- People are now living much longer than when Social Security was enacted in 1935 and when the last major program change occurred in 1983. The average life expectancy of recipients today is in the mid-80s, compared to the mid-60s ‘s when the program started. In other words, people are now collecting benefits for much longer (often decades longer) than the program was designed to support.
- The number of workers contributing to the program is growing much more slowly than the growth in beneficiaries receiving benefits. This means that the ratio of contributors to recipients is much smaller now than it has been in the past, which means that program costs are growing faster than incoming revenues.
The reality is that reform is needed now to avoid cuts to everyone’s benefits later. But here’s a very important point that should comfort you – any reforms that are passed will almost certainly only affect those who have not yet claimed their Social Security benefits. This means that you should not be affected because you are already receiving benefits and will continue to do so at the same amount, except for the increases you get from Cost of Living Adjustments (COLA). Every change to Social Security that has ever been made has only affected future beneficiaries, not current ones. The only real threat to your Social Security benefit is if no changes are made, and even then any cuts wouldn’t happen until around 2034.
So make sure your personal social security benefits are not cut. Anything you hear now suggesting otherwise is a scare tactic designed to make headlines for political gain. The program must be reformed or face insolvency in a little more than 10 years, which is what both Republicans and Democrats want to prevent. The difference between the parties is that one side wants to solve the problem mainly by raising payroll taxes on workers, while the other side wants to adjust the program to deal with the above two factors that cause the problem. What is needed is bipartisan cooperation to reach a compromise that Congress will hopefully eventually reach. They already know how to solve Social Security; they just need to find the two-part spirit it takes to do it. For its part, the Association of Mature American Citizens (AMAC) has for years proposed changes that would restore Social Security to full solvency without raising taxes on American workers, and AMAC’s proposals have been well received by many in Congress. To review AMAC’s proposal, go to www.amac.us/social-security/.
In any case, contrary to what you may hear in the media, your current Social Security benefits should not be adversely affected by any future Social Security reform that is enacted.
This article is intended for informational purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of AMAC Foundation staff, trained and accredited by the National Social Security Association (NSSA). NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other government entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at firstname.lastname@example.org.