Social Security Matters by Rusty Gloor, National Social Security Advisor at the AMAC Foundation, the nonprofit arm of the Association of Mature American Citizens
Dear Rusty: Politicians talk about taking Social Security money, but I need that money to support my daughter and pay for my house. I am a widow and my husband passed away in 2017. I will lose my house if my social security benefits are reduced. Please help. Signed: senior widower
Dear Elder Widow: Despite what you might read or hear in the media, the main threat to you of losing your Social Security money is if Social Security is not reformed. In this case, everyone receiving benefits will see a reduction of around 23% in their monthly benefits starting around 2034. The way to avoid this is to update the current Social Security law to address two main issues:
- People now live much longer than when Social Security was enacted in 1935 and when the last major program change took place in 1983. The average life expectancy of recipients today is in the mid-80s, per compared to the mid-1960s when the program started. In other words, people are now collecting benefits for much longer (often decades longer) than the program is supposed to support.
- The number of workers contributing to the program is growing much more slowly than the growth of beneficiaries receiving benefits. This means that the contributor-to-recipient ratio is much lower today than it was in the past, which means program costs are growing faster than incoming revenue.
The reality is that reform is needed now to avoid cuts to everyone’s benefits later. But here is a very important point that should comfort you: any reforms enacted will almost certainly only affect those who have not yet claimed their Social Security benefits. This means that you should not be affected because you are already receiving benefits, and you will continue to do so at the same amount, except for the increases you will get from cost of living adjustments (COLA). Each change to Social Security only affected future beneficiaries, not current ones. The only real threat to your Social Security benefits is if no changes are made, and even then no cuts would occur until around 2034.
So rest assured that your personal social security benefits will not be reduced. Anything you hear now implying otherwise is a scare tactic designed to grab headlines for political gain. The program must be reformed or face insolvency in just over 10 years, and that’s what Republicans and Democrats want to prevent. The difference between the parties is that one side wants to fix the problem primarily by increasing payroll taxes on workers, while the other side wants to adjust the program to address the two aforementioned factors causing the problem. What is needed is bipartisan cooperation to reach a compromise, which Congress will hopefully eventually reach. They already know how to fix Social Security; they just need to find the bipartisan spirit to do so. For its part, the Association of Mature American Citizens (AMAC) has for years proposed changes that would restore Social Security to full solvency without raising taxes on American workers, and the AMAC’s proposal has been well received. by many members of Congress. If you want to see the AMAC proposal, go to www.amac.us/social-security/.
In any case, contrary to what you might hear in the media, your current Social Security benefits should not be negatively affected by any future Social Security reform enacted.
This article is intended for informational purposes only and does not represent legal or financial advice. It presents the opinions and interpretations of AMAC Foundation staff, trained and accredited by the National Social Security Association (NSSA). The NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other government entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at ssadvisor@amacfoundation.org.