Social Security reform is a hot topic, and for good reason. Optimistic projections have the SSA running out of money by 2037, but with the economy still struggling and unemployment higher than expected, it may happen sooner than any of us are prepared for.
President Obama has established a deficit commission, and this commission is expected to come up with a list of Social Security reforms this November. This means that the SSA retirement and disability programs so many New Yorkers depend on are likely to change – we just aren’t sure when.
What will Social Security Reform look like? Experts believe that there will be three main components of any reform package: reduced benefits for wealthy Americans, more taxable wages, and an increase in the retirement age.
- Fewer benefits for the wealthy: there is a push among lawmakers to decrease benefits for wealthier Americans. This way, citizens who have a healthy amount of money saved up will receive less from the SSA than individuals with little or no retirement savings. This would allow SSA funds to go to only those who truly need them.
- Higher revenues could be achieved by raising the taxable income ceiling above its current level of $107,000, so more income from wealthier Americans is subject to Social Security taxes. Another idea is to make immigration laws more favorable for young workers, to increase the pool of workers who pay into the SSA system.
- If the retirement age were raised, Americans would have to stay in the workforce longer before drawing benefits, reducing the strain on the system.
Not all these ideas are popular, especially with retired and disabled New York workers, and it remains to be seen what changes the task force will unveil this fall.