How Social Security Protects Millions of Seniors From Poverty
Social Security benefits play a vital role in reducing poverty. In fact, the program lifts more people above the poverty line than any other program in the United States.
According to a Center on Budget and Policy Priorities report, this includes 16.3 million Americans aged 65 and older. Without Social Security benefits, 37.3 percent of older adults would have income below the official poverty line. In 2023, that was $14,614 for an elderly individual and $18,418 for an elderly couple, according to Census Bureau data.
History of Social Security
The idea of Social Security came about during the Great Depression of the 1930s. At that time, poverty rates among senior citizens exceeded 50%. It was part of President Franklin D. Roosevelt’s New Deal initiatives.
According to Investopedia, the Social Security Act of 1935 established benefits for old-age retirees and the jobless, as well as aid for dependent mothers and children, victims of work-related accidents, people who are blind, and those who have physical disabilities.
Social Security Expansion Plan
Those same people are now facing poverty once again. Over the years, benefits have not been able to keep up with rising costs, even with the Social Security cost-of-living adjustment (COLA). Additionally, the Social Security trust fund is facing a deficit. In a few years, it will no longer be able to pay full benefits. Congress needs to step in a do something.
The Seniors Trust believes the solution is the Social Security Expansion Plan. When passed, this landmark piece of legislation 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.
• Providing enhanced benefits would be set to greatly reduce senior poverty to guarantee the long-term solvency of the Social Security program.
The Social Security Expansion Act seeks to reform Social Security the right way: by expanding and strengthening benefits proven to reduce senior poverty and improve retirement security, and extending the solvency of this crucial program.
