The most recent Social Security and Medicare Trustees report predicted that the trust fund that supports Social Security is expected to be exhausted by 2033 – that’s one year earlier than previous predictions. According to an article by FingerLakes1.com, if the trust fund does run dry, benefits could be cut by 20-30%. That’s because the law states that Social Security can only pay in benefits what it collects in taxes.
Are Tax Increases Looming?
The article suggests there are two possible solutions to restore Social Security solvency. One option would be to increase penalties to people who claim benefits early. While that option is popular among some fiscal conservatives, progressives think it’s a bad choice. They believe raising taxes is the best means to keep the trust fund and Social Security programs solvent for decades to come. There have been calls to increase payroll taxes from the current 12.4% to 16%, keeping it split evenly between employees and their employers with each paying 8%.
We Have A Viable Solution
Rather than raise taxes, The Seniors Trust supports eliminating the wage cap as a means of expanding Social Security. We firmly believe that lifting the earnings cap on Social Security contributions will solve this problem.
Scrapping the cap would allow Social Security to pay out bigger benefits. It’s all part of the Social Security Expansion Act. This landmark piece of legislation calls for increasing monthly benefits by about $65 on average. It also includes plans to establish a fairer annual cost-of-living adjustment based on the actual spending habits of seniors and shore up the long-term solvency of Social Security.
If this is something you support, please add your name to our petition to Congress. You are not alone. Our efforts to expand Social Security have unanimous support. A full 100% of people polled say Congress should pass the Social Security Expansion Act which expands benefits and protects the financial security of retired Americans.