Social Security, Present And Future
According to the New York Times Sunday Review Editorial Section, “Social Security, Present and Future” article dated April 1, 2013 the Obama Administration may need to cut the future cost of living adjustments (COLA) in order to preserve the Social Security Solvency. However, according to the New York Times editorial staff, COLA cuts would not make up for the imminent insolvency of Social Security post 2033. The article states that without repairs, Social Security would only be able to pay about 75 percent of promised benefits.
The Article notes that over half of individuals ages 55 to 64 have not saved for retirement and will be relying upon Social Security for a portion of their retirement. I am one such individual, having put three sons through private colleges with one with still two more years to complete.
The writers urge against utilizing Social Security cuts for deficit reduction in a weak economy with high unemployment and instead opt for other spending cuts and tax increases. It was also suggested that “trimming benefits for upper-income recipients who live longer and draw larger benefits could close about 10 percent of the surplus long-term funding gap.” A third suggestion was to raise the payroll tax cutoff to $200,000.00 instead of the current $113,700.00. A fourth suggestion was to raise the payroll tax rate by one percentage point for a twenty year period.
As a taxpayer and future retiree (maybe when I reach 100, at this rate), I feel it is important that we write our congressman and senators and speak out to protect Social Security for the vast majority of retirees. Let’s face it- all options are painful but a solid solution must be reached as soon as possible.