Social Security turns 90. Here’s what could happen to future benefits

Ninety years ago President Franklin Delano Roosevelt, Social Security LawWhich Created the program This is now sending monthly benefit controls to millions of Americans, including retirees, disabled individuals and families.

However, when the program celebrates its centenary, the benefits may not appear the same as today’s social security payments.

The reason for this is: the confidence funds that Social Security helps to pay the program is faced with an approaching deficiency.

Starting from 2033 – two years before the 100th anniversary – program, retirees, families and survivors can pay only 77% of the benefits, the Board of Trustees of Social Security Annual report It was released in June.

However, if these funds are combined with the Trust Fund for disability aids of Social Security, payments can be cut in 2034 after a year, as in previous emergencies. At this point, 81% of the planned benefits will be paid, Social Security Board of Trustees Project.

More importantly, the benefits of social security would not be completely eliminated. The program will have income from payroll taxes to help finance benefit payments.

This scenario is not inevitable. Changes in the program can be removed earlier to increase financing and prevent sudden benefit cuts.

Most of the 83%of the survey The Americans think that social security reform should be the most important priority for the congress, even if it means benefit deductions or tax increases for future beneficiaries. Bilateral Policy CenterAmerican Savings Training Council. The group destroyed more than 4,000 adults.

“This is time for action,” he said to CNBC.com.

Cassidy is a newly new -party field. Tim Kaine worked with D-Virginia. $ 1.5 trillion investment fund For social security, it is separate from the current trust funds of Social Security.

The first $ 1.5 trillion expenditure will be borrowed. Cassidy, money will be done with the trust and liquefaction will not increase the national debt, he said.

The funds will be deposited more aggressively than the current trust funds of Social Security, which is invested in US Treasury securities. These investments are safe because they are supported by the US government’s full belief and loan. However, the average return rate for a period of one year was around 2.5% in 2024.

In contrast, the S&P has rotated around 10%on average of 500 years, but these results vary from year to year.

Cassidy, the proposed investment fund in stocks, bonds and other investments to invest, the social security safety fund lack of lack of 70%, he said. This said it would make the remaining 30%of the deputies dealt with.

Cassidy, senators plan for the elderly for any benefit deduction or tax increase, he said. It will provide benefits for two cohort for those who are less than 200% of the federal poverty level, less than 2000 years of age and over and low -winning low wages.

The authority said that deputies may intend to increase the size of the investment fund to help to meet the rest of the deficit.

Cassidy said the right to manage the fund will be left to a proposal process that can provide lower wages and higher return.

The critics, including representative John Larson, said that the senators plan would privatize social security and therefore threaten Americans’ retirement security, and said to invest in other securities.

On the other hand, Cassidy points to the federal railway pension system, which is only more aggressive vehicles, including shares, from investing in government bonds in 2001. This change was approved by deputies on both sides of the corridor and helped the program to work with a positive balance today.

Nevertheless, some experts are suspected.

One Latest Wall Street Journal OP-EDAndrew Biggs, a senior member of the American Enterprise Institute, said he questioned whether the plan would work while applauding the first two -party plan to correct social security.

Among the concerns, there is an increasing risk of investment, which will be necessary without the amount of money required by the government to borrow the government and a higher return guarantee.

Cassidy and Kaine are not the only deputy overlooking potential solutions to solve the social security dilemma.

Larson In many sessions of the Congress, it has a plan that will provide benefits while increasing taxes on the rich. In an interview with CNBC.com, Larson said he was under President Richard Nixon in 1971, when Social Security was the last significantly developed.

Larson most last offer From 2023 onwards, it will temporarily increase the benefits for all beneficiaries and at the same time provide special improvements for minimum benefits; Widows or widows in two -income households; And the children of deceased, disabled or retired workers who are full -time students. The plan also proposes to change the calculation of annual life cost regulations.

Larson’s plan to pay for these benefits increases calls over $ 400,000 to be subject to payroll taxes. In 2025, workers stop contributing to social security for the year when they earn $ 176,100. Both employers and employees pay 6.2% tax from wages to this threshold.

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The two -party policy center survey finds that the majority of Americans support to remove the limit on income subject to payroll taxes, and that 65% of the democrats and 62% of the Republicans. According to the results, this includes a “significant majority” with an annual household income of more than $ 200,000.

Larson’s plan called a 12.4% tax for net investment revenue for taxpayers with over $ 400,000.

Larson plans to re -introduce his plan in the Congress’s current session with some changes.

“In September, we will make a presentation that will include not only protecting social security, but also development.” He said.

The plan also said that the Congress will take action more frequently to help individuals continue to meet their needs.

“I think it’s very important to keep it under control.” He said.

Larson plans to vote for his bill. But he also wants a clear discussion.

“There must be a public debate, L Larson said.

Most Americans – 64% of democratic voters, and 61% of Republicans – want to work together on party lines for the social security reform, a two -party policy center in the last survey of the Congress.

According to BPC, 41% of the Americans participating in the survey expect social security to be the primary source of retirement in retirement. Moreover, while 74% of Americans are worried that social security will be exhausted before retirement, the 80% concern congress will reduce benefits.

However, the results of the survey show that Americans will accept “a comprehensive, balanced reform package that requires both benefit regulations and tax increases”.

In order to help repair the financing of the program, increasing taxes over 1% was the highest support among the BPC’s survey participants, 85% of the democrats and 72% of the Republicans. This is contrary to 65% of the democrats and 62% of republicans supporting a higher border in payroll taxes.

The majority of voters support the recruitment of help for those who need 63% of the democrats and 62% of the Republicans.; To reduce benefits for high -income individuals with 64% of the democrats and 61% of Republicans; Increasing the amount paid by 61% of both democrats and republicans and employees and employers. Most voters also support the encouragement of legal migration, which will cause more workers to pay to the program with 64% of the Democrats and 54% of the Republicans.

The urgency of addressing the financing problems of Social Security will increase over time.

Two new laws have provided generous improvements for some social security beneficiaries. Increased benefits for the Social Security Justice Law Some public retirees, President Donald Trump’s “Big Beautiful” budget and tax package provides tax reduction for the elderly.

Amendments to both laws will accelerate the dates of the trust fund. The justice law included the latest projections of the social security trustees. The new “Great Beautiful” Legislation will carry the bankruptcy date for the Pension Confidence Fund to the projection of the 2033 Board of Trustees by the end of 2032. Responsible Federal Budget Committee.

Sprick said the senators selected in 2026 will be on duty during the prescribed final procedures.

As the dates of the Trust Fund approached, there would be more discussion about the future of Social Security in Capitol Hill. Capitol said that the current suggestions in Hill were the beginning.

“We have postponed this for a long time, the political process is moving very slowly.” He said. “But this does not eliminate the fact that these conversations are progressing in the right direction.”