Social Security and some massive changes to monthly benefits. I have all the details and what you need to know right here on this topic. So let’s get right into it right now. If you’ve been reading the topics here on the site for any length of time, you know that there are multiple pieces of legislation currently floating around Congress to reform Social Security, raise benefits, adjust the way that the cost of living adjustment is calculated, as well as increased solvency for this very important program for many decades to come. Well, now there’s a new idea floating around Congress to once again massively change monthly benefits under Social Security.
So I want to get into it and discuss all the details about this and what this would mean for monthly benefits going forward for millions and millions of beneficiaries. As I am your one and only daily advocate, I’m doing research all day, every single day, breaking it down into these short topics so that you can stay updated with what is really going on right now, what is being discussed between lawmakers, the new piece of legislation, the new bills, and anything else they may be coming up with to change these very important benefits as well as anything else that pertains to money, benefits, raises to benefits, piece of legislation, checks, and anything else that may be impacting millions and millions of fixed income beneficiaries.
All right, so I do want to talk through the details about this because yet again, there are more ideas floating around Congress and some lawmakers to discuss how can they actually extend the longevity and the livelihood of Social Security. Now, based on some reports that came out about two, three, four weeks ago or so out of the Social Security Board of Trustees and of course, the insolvency issue that we’re all dealing with here in about 13 years, that’s a long time from now. But again, they’re starting to think of some different ways as far as what can we do to change this program. Not sure why they can’t just leave things alone, but again, they want to change it.
And sometimes this isn’t exactly the best thing for all people. So it sure would be nice if they changed the program in a positive way to actually raise benefits for beneficiaries. But again, that is one of the things that they are currently working on and discussing out there as well, raising the benefits for the lower-income individuals. And now there are some changes that possibly may impact other people receiving benefits as well. So here’s what the ideas are now.
Again, none of this has actually gone into effect yet, but it’s just another idea that’s floating around out there to massively change Social Security and figure out what can they do to actually kind of shore up this program. Because we know, we’ve talked about it many times here. This program potentially faces some major issues here, probably before too long, right? So here’s the thing. Let me talk about this.
And again, this is just another idea that they’re floating out there. And again, there’s kind of some support behind this. So let’s pay attention to this one, right? So what the idea is now is, as you probably know, Social Security is one of these programs where during your working years, right, every single paycheck that you receive, you look at it and you look at your pay stub and think, hey, wait, where did all my money go? Well, then you look at the line that says FICA F-I-C-A right?
Well, that is actually Social Security taxes that are being taken out. And putting kind of into the Social Security trust fund kind of on your behalf is almost like a deferred savings account, right? You pay in through all of your working years, through Social Security payroll taxes, with the promise that at some point in the future, in the event that you become disabled and or during retirement, you get to start drawing on these benefits. And therefore, it’s like a deferred savings account that the government is kind of holding for you, right? Then you start to get these monthly payments as a result of Social Security benefits, right?
We get the program, right? So here’s what they’re considering now. So that’s what the program is currently, right? However, here’s what they’re now considering, turning it into a means-based program. What does this mean?
Well, basically it comes down to this basically kind of qualifying every beneficiary to determine do you need the money or are you not really in need of the money right now? So means based, in other words, if you need the money, then by all means we’ll give you the money. But if you don’t need the money or if you’re somebody who is doing a little bit fine, then sorry, your benefits might be cut dramatically, and or you might not even get benefits. Well, of course, as you can probably tell, there’s probably a lot of controversy about this thing. Is this even fair?
Somebody that has paid into the system, paid in for 20,30, 35, 40, 45 years, and all of a sudden they come to retirement and then they say, oh, sorry, you can’t get benefits. You earned it. Too much money throughout your lifetime. Sorry, you’re out of here, right? Is that fair?
Well, I won’t get so my opinion here, but again, that is one of the things that is being talked about right now is this even a fair approach? So let me tell you more details about this because this is actually pretty interesting. So according to a most recent poll where they were asking people what should we do with higher-income Social Security beneficiaries? Should they receive their full benefit or should it be reduced? Here’s what they found.
81% of people that responded to this poll said they’re in support of reducing or even removing Social Security benefits for higher-income individuals. So that means that those people that may be earned a higher salary throughout their working career or possibly have a little bit of extra money during retirement, these people that were pulled said that they’d be 81% of them said that they would be in support of either reducing and or completely removing Social Security benefits for higher-income earners. That’s a lot, right? So basically only 19% of the people say, no, we shouldn’t do that, we should make it fair. And you make sure that everybody gets their kind of promised benefit that they’ve essentially earned throughout their working career, right?
So anyway, let me tell you some more details about this as well. So basically it comes down to this. If they reduced benefits for the top 20% of income earners, if they reduce those benefits or made it means tested, this would actually short up the Social Security shortfall by about 11%. Like 11% of the Social Security shortfall would be short up just by reducing or removing the top 20% of Social Security beneficiaries and their benefits. So again, it’s kind of tempting, right, because you look at it, on one side of the equation, you say, well, it’s maybe not fair, but on the other side you say, well, look at all this extra liquidity that we’d be getting out of Social Security and how many more years we can continue to pay out promised benefits for all the millions of lower-income beneficiaries as a result of just this one change, right.
So I didn’t really see any lines in the sand as far as what the income thresholds would be, as far as anybody earning over this amount would then be subject to reductions in their Social Security benefits or potentially even complete elimination of their benefit going forward, right? And again, the whole idea behind that would be to increase solvency of the program to make sure that they can continue to send out the guaranteed promised benefits for many more years to come and possibly even implementing like one of these new bills out of Bernie Sanders, which is the Social Security Expansion Act of raising benefits by $200 per month going forward. So there’s a lot of different moving parts here. This is another one that came out and wanted to share with you because it’s kind of interesting because let’s be real, everybody is kind of defensive of their Social Security benefits. And by all means you kind of should be, right?
You’ve spent years and years and years working, paying in through payroll taxes you’ve earned all this money that you’ve essentially been paying in throughout your entire life and they’ve basically put it aside for you as like a government managed savings account that pays you like monthly stipends or almost like annuity payments going forward throughout your entire retirement or in the event that you’re working and potentially get disabled. Then again, you can start drawing on these benefits that you’ve earned and acquired throughout your working career. So by all means when it comes down to these benefits, yeah, you should be protective of them and be defensive of it because you’ve earned it. I mean, you’ve put the time and you paid in all of these payroll taxes for this and all of a sudden to possibly be faced with, hey, wait, just kidding, you did too well during your lifetime and you don’t get anything now. Sorry.
Right. I don’t know, it seems a little bit weird to me, but they’re trying to figure out different ways that they can increase the solvency of this program and make sure that they can continue to send promised benefits for a very long time to come. Now here’s the thing though. Social Security has been around for how many decades? Like 70 years or something?
Not quite 70 years, but like 65 years or something. They’ve never missed a payment according to what they’ve said and according to what some lawmakers have said, the program has been solvent and things have been fine and dandy for a very long time. So again, I’m thinking they’ll be able to figure it out, right? They’ve been able to figure it out this whole time. It’s been a very popular and a very successful program so far and we’ve been hearing about this for years, right?
We’ve been hearing about Social Security going broke, it’s bust, it’s bankrupt, we’ve heard all these different things for many years. So again, is it just the same old song and dance? Probably, but who knows? This is just what they’re discussing out there right now. But again, there are other multiple different, other ideas out there as far as how to show up the program.
But this is just another one that they’re considering. But I’m guessing it’s probably not going to get all that much support simply because Social Security was never meant to be a means based program, right? It was a program that you basically earn throughout the course of your life. You earn the benefits and therefore you get to draw on the benefits, right? So it was never really meant to be a means based program anyway thanks for visiting our site. take care bye.