One Proposed Social Security Solvency Solution Could Mean Cutting Off Benefits to Millions of Retirees
Social Security is facing a funding shortfall. If Congress does not act soon, there will be no choice but to slash benefits. Nobody wants to see that happen. That’s why many lawmakers and financial experts are floating ideas on how to shore up Social Security.
Yahoo! Finance looked into a proposal by Scott Galloway, a NYU professor and podcaster. In a recent episode, he said that 10-30 percent of people who receive Social Security shouldn’t because they don’t need the money.
Galloway calls American seniors “the wealthiest generation in the history of this planet.” At the same time, he says Gen Z and millennials are struggling with debt, cost of living, and stagnant wages, but it’s their payroll taxes that fund Social Security. He thinks that eliminating benefits for the wealthiest retirees will address some of the wealth imbalance and reduce the burden on young workers.
A Better Solution
While that’s certainly something interesting to consider, we at The Seniors Trust believe the best option for saving Social Security already exists. We want Congress to enact the Social Security Expansion Act. This landmark bill buttresses the long-term solvency of Social Security by expanding benefits for seniors, not cutting them.
If passed, the Social Security Expansion Act will make four major changes to Social Security for retirees:
• Benefits will be increased for most recipients by about $200 per month.
• The Consumer Price Index for the Elderly (CPI-E) will be used to calculate Social Security Cost-of-Living Adjustments (COLAs) instead of the Consumer Price Index for Urban Wage Earners (CPI-W) used currently. The CPI-E takes the unique spending habits of seniors into account, particularly regarding the cost of healthcare, and offers a more realistic COLA for retirees.
• Increase minimum Social Security benefits to provide higher payments to seniors and greatly reduce senior poverty.
• Provide enhanced benefits would be set to greatly reduce senior poverty to guarantee the long-term solvency of the Social Security program.
