A recent survey found that most Americans were unaware that Social Security benefits could be subject to cuts over the next decade. (iStock)
A recent survey found that Americans who are unaware of the impending changes to Social Security are the only ones who aren’t bothered by them.
According to the Peter G. Peterson Foundation, only 30% of respondents knew that without reform, Social Security recipients would face automatic reductions in benefits over the next decade, with the average couple facing cuts of about $17,000 a year. investigationThese Americans support reforms to protect their benefits.
But once respondents who were unaware of the upcoming changes understood the ultimate impact, 97% agreed that it’s important that leaders elected this fall strengthen Social Security to ensure that current and future generations can fully access it.
“These results demonstrate that while there is still work to be done to educate the public about Social Security’s precarious finances, there is overwhelming support for courageous leaders to understand the current situation and take action,” said Michael Peterson, CEO of the nonpartisan Peterson Foundation. “Voters understand that ‘no touch’ on Social Security is not an option — automatic cuts are unacceptable, and waiting will only make the problem more costly and harder to solve.”
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Social Security’s ability to pay is extended by one year
Social Security benefits are still expected to start drying up. Recent Reports A report released by the Treasury Department said cuts to benefits may not be needed until 2035, a year later than previously predicted.
The board said it projects that the Social Security Trust Fund will begin to run out of money by 2035 and that seniors’ benefits will be cut by 17 percent unless Congress acts to strengthen the system. The trust fund’s ability to remain solvent for another year is due to higher wage growth and a falling unemployment rate.
“Strong economic policies have led to impressive wage growth, historic job creation, and steadily low unemployment, which has led to more people signing up for Social Security. As long as Americans keep working, Social Security can and will keep paying benefits,” said Social Security Administrator Martin O’Malley. “Congress can and should take steps, as it has done in a bipartisan manner in the past, to maintain the financial strength of the Trust Fund into the foreseeable future.”
“Closing this shortfall would provide relief to the more than 70 million Social Security recipients, the 180 million workers who contribute to Social Security and their families, and the American people as a whole,” O’Malley continued.
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Advocacy groups say COLAs haven’t kept up with inflation
According to the latest projections from the Senior Citizens League (TSCL), the Social Security cost-of-living adjustment (COLA) for 2025 will be 2.57%, down from the 2.66% forecast last month. Social Security recipients will receive a 3.2% increase in 2024, down from the 8.7% increase last year.
The Social Security cost-of-living adjustment (COLA) of 3.2 percent is well above the 20-year average of 2.6 percent, but 69 percent of retirees say their household expenses rose faster than the COLA last year, with food and housing costs rising, according to TSCL.
“In fact, COLAs are becoming less and less likely to keep up with inflation over time,” TSCL states. “Of the five COLAs implemented so far in the 2020s, only one (20%) has outpaced inflation, compared with 40% in the 2010s and 60% in the 2000s and 1990s. To make matters worse, COLA shortfalls can leave seniors thousands of dollars short of what they were expecting from Social Security, largely because COLA shortfalls have a cumulative effect over time.”
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