Benefit Bulletin: May 2017

Benefit Bulletin: May 2017

Boosting Social Security May Boost Cognitive Function

A severe decline in cognition is often an early warning signal of Alzheimer’s disease and dementia. Loss of cognitive function can seriously impair one’s ability to live independently, and, with our aging population, imposes a huge financial burden on patients and caregivers, as well as Medicare and Medicaid programs. Although the causes of Alzheimer’s and dementia are still not well understood, a growing body of evidence suggests that factors which can be modified, like education, retirement age, and income, play a role in cognitive function at older ages.

A 2015 study, conducted by Padmaja Ayyagari and David Frisvold of the University of Iowa, found that income may affect cognition several ways including lowering financial stress and providing better access to healthcare. Greater access to healthcare has been shown to result in earlier detection of mild cognitive impairment, enabling treatment that may delay progression of Alzheimer’s or dementia symptoms.

The impact of income on cognitive function is of particular importance, as Social Security becomes the target of proposals to cut federal spending on benefits.  Cutting benefits is not only bad for retiree finances; it can lead to more rapid decline in health.

In fact some lawmakers in Congress are arguing that that benefits should not be cut, but boosted. Recently, Senator Bernie Sanders (I-VT) and Representative Peter Defazio (D-OR-4) introduced legislation that would boost Social Security benefits and extend Social Security solvency another 44 years.

“Anyone who tells you Social Security is going broke is lying,” Senator Sanders said when he introduced The Social Security Expansion Act. “We can increase Social Security benefits for millions of Americans and extend the life of Social Security if we have the political will to tell the wealthiest Americans to pay the same rate as everyone else.”

The Social Security Expansion Act legislation would increase benefits by about $1,300 a year for seniors now making less than $16,000 annually. The bill would also increase cost-of-living adjustments (COLAs) by about $73 a month over a 30-year retirement.

TSCL strongly supports The Social Security Expansion Act, and supports providing a modest boost to Social Security benefits in order to provide greater benefit adequacy and retirement security.  This legislation couldn’t be more timely.  Over the past 8 years, Social Security benefits have remained almost flat, with COLAs averaging just 1.1%, about one-third the historical inflation average of 3%.

 

Sources:  “The Impact of Social Security Income On Cognitive Function At Older Ages,” Padmaja Ayyagari, David Frisvold, University of Iowa, August 2015.

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