Social Security Politics and Mathematics

By Staff Reporters

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Although the future of Social Security remains in doubt, some congressional lawmakers are ensuring that most Social Security recipients get their money and then some. Sen. Bernie Sanders (I-Vt.) introduced the Social Security Expansion Act (SSEA) in June. The bill would allot $200 more per month for each Social Security recipient — a 12% boost in money, according to CBS News.

The bill was introduced after the Social Security Administration said that Americans would no longer receive benefits in 13 years, if congressional lawmakers do not address the funding shortage.

So who will receive these Social Security increases?

The people who are currently eligible for Social Security or anyone who turns 62 in 2023, which is the earliest age to collect Social Security, will be eligible to receive the extra $200 a month with their benefits.

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Now, at present for Social Security, 12.4% is taken out of each paycheck for people earning up to $147,000, with half paid by the employer and half paid by the worker. So, if you make $147,000 or less, you are paying 6.2% into Social Security. If you make, say, $1.47 million, you only pay 0.6% of your income to Social Security.

If the pending new SS bill is approved, the same rate would be taxed on individuals making $250,000 or more. Those making $147,000 or less would continue to pay the same rate as well, with a do-nut hole between the $147,000 and $250,000 — although that $147,000 typically goes up each year, as it is based on average income.

The increased funding — along with a change in the cost-of-living-adjustments (COLA) to the Consumer Price Index for the Elderly (CPI-E) — would help to increase benefits by an estimated $200 per month, or $2,400 per year, which bears out, according to an analysis by the Social Security Administration (SSA).

RELATED: https://www.routledge.com/Comprehensive-Financial-Planning-Strategies-for-Doctors-and-Advisors-Best/Marcinko-Hetico/p/book/9781482240283

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