President-elect Joe Biden ran for office on a platform that called for expanding Social Security benefits for seniors and increasing payroll taxes on high-income earners to fund the program. The Biden Plan for Older Americans details exactly how he plans to protect and strengthen Social Security.
The Biden Plan pledges to protect benefits for the millions of older Americans who depend on Social Security. The President-elect’s biggest hurdle will be shoring up Social Security’s trust fund (the reserves that pay the benefits).
A recent CNBC report on the President-elect’s plan illuminated the situation the country is facing due to the coronavirus pandemic. With unemployment at high levels, the amount of money being collected through payroll taxes has shrunk. Prior projections showed that Social Security funds would be depleted by 2035 – but that may now happen much sooner. To help make up that deficit and promote Social Security’s long-term solvency, the Biden Plan calls for Social Security payroll taxes on those making $400,000 or more. Currently, only wages up to the first $137,700 are taxed.
The President-elect’s Social Security platform would also increase benefits to recipients. Under the Biden Plan, retirees who spent 30 years working will get a benefit of at least 125% of the federal poverty level.
Another element of the Biden Plan calls for basing the annual cost of living adjustment (COLA) on the Consumer Price Index for the Elderly, or CPI-E. That’s preferred because the CPI-E better accounts for the expenses retirees face, such as healthcare costs.
The Seniors Trust firmly stands behind increasing benefits and implementing a fair COLA. These are two of the key components of the Social Security Expansion Act, which The Seniors Trust is working to pass. Vice President-elect Kamala Harris is one of the bill’s co-sponsors.
If passed, this legislation will make four major changes to Social Security for retirees:
• Benefits will be increased for most recipients by about $65 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.
The Biden Plan for Older Americans appears to align with The Social Security Expansion Act — but we need to see action.
The Seniors Trust – with the help of concerned citizens like you – will continue urging politicians from both sides of the aisle to live up to their promises to senior citizens. They must increase Social Security benefits and bolster the program – passing The Social Security Expansion Act is the best way to do that.
You can help improve our chances of making our legislation a reality by signing our petition to Congress and joining us as we strive to improve the lives of senior citizens.