New Survey Shows Growing Pessimism About Social Security Future
A new survey by the Nationwide Retirement Institute shows younger Americans are growing concerned about the future of Social Security. The survey found that 45 percent of Gen Z adults (ages 18-26) said they expect to not “get a dime” of the benefits they have earned, and 39 percent of millennials (ages 27-42) said the same thing.
Even older Americans are worried. The survey found that 75 percent of respondents aged 50 and older expressed concern that Social Security could run out of funding in their lifetimes.
As The Hill reports, the question now is what can be done to solve Social Security’s solvency issues. The survey revealed that less than 25 percent of respondents support increasing funding through payroll taxes. Instead, almost half would like to see tax increases on higher wage earners to pay for the program.
Viable Solvency Solution
That’s a prospect currently being floated on Capitol Hill. Several lawmakers believe the best way to ensure Social Security solvency is through higher payroll taxes or reductions to benefits for wealthy Americans. That’s the basis behind the Social Security Expansion Act proposed by Senator Bernie Sanders (I – Vermont).
To ensure Social Security can pay out future benefits, Sen. Sanders thinks high-wage earners and the wealthy need to pay their fair share. His bill proposes subjecting earnings over $250,000 to the 12.4 percent payroll tax. Currently, only $160,200 of wage income is subject to payroll taxes. He would like to levy other taxes as well, such as subjecting investment income over $200,000 to payroll taxes.
According to Sen. Sanders, lifting the cap on Social Security taxes would extend its solvency until the year 2096, ensuring that benefits are not cut.
Additionally, the Social Security Expansion Act would provide bigger monthly benefits — about $200 on average. It will also establish a fairer cost-of-living adjustment (COLA) by using the Consumer Price Index for the Elderly (CPI-E) instead of the Consumer Price Index for Urban Wage Earners (CPI-W) used currently because the CPI-E takes into account the unique spending habits of seniors.
The Seniors Trust supports this proposed legislation. You can help our efforts by signing our petition calling on Congress to enact the Social Security Expansion Act.
