By Edward Cates, Chairman of the Board, TSCL
The Social Security Administration (SSA) recently announced some important news in its 2024 Annual Report to Congress. The SSA projects that the trust funds have enough projected revenue to pay all scheduled benefits through 2033 rather than 2034, which is when last year’s report expected it to deplete its reserves.
If reserves reach zero in 2033, Social Security will only have enough funds to pay 83 percent of the benefits it owes to seniors. If we applied that cut to 2024’s average monthly check of $1,860 for retired workers, the average senior would lose out on about $316.
To prevent this from occurring, the SSA Commissioner said that legislative changes are needed to extend Social Security’s solvency. “It’s critical that Congress acts quickly to address the projected trust fund shortfalls,” he said in a press release that accompanied the report, pointing to previously successful bipartisan legislation to extend Social Security as an example. Whether that comes from “increasing revenue, reducing benefits, or some combination, is a matter of political preference, not affordability.”
If you ask most seniors, of course, reducing benefits shouldn’t be an option. As we’ve repeatedly mentioned throughout this issue of The Advisor, many seniors are already struggling because Cost-of-Living Adjustments (COLAs) haven’t kept up with inflation. Even SSA itself acknowledges the importance of maintaining robust benefits, estimating that Social Security is the difference between poverty and dignity for about 50 percent of seniors, or more than 35 million people.
That’s why we’ll keep fighting for you at TSCL.
Simple changes, like having America’s highest earners pay more of their wages into the program than the average worker, applying Social Security taxes to investment income for the wealthy, and using a price index specifically designed for older Americans to calculate COLAs, would protect benefits today while extending the program’s life for future generations.
We’re pushing for changes like these to make sure you get the fair deal you deserve after paying into Social Security all those years, as well as the retirees tomorrow who are paying into the fund today. And with 2024 being an election year, we encourage you to support candidates who will do the same.
