February 19, 2019
Tweaking Social Security for the Future
Social Security remains as vital today as it was after its 1935 passage. But advocates for the nation’s most vulnerable retirees have proposed ways to enhance their benefits.
Consider the minimum benefit. Put on the books in the early 1970s, its goal was to prevent poverty among retirees who had worked for decades in low-paying jobs. The benefit’s value has diminished due to a design flaw that rendered it largely ineffective.
A recent policy brief by the Center for Retirement Research analyzed various modest proposals to increase the minimum benefit and improve low-income retirees’ financial security.
This brief was the last in a series on modernizing Social Security. The relatively low cost of these proposals, many of which have bipartisan support, could be offset by benefit reductions for less-vulnerable retirees. The House of Representatives is planning hearings later this year looking into ways benefits might be enhanced.
The following are synopses of the policy problems and proposals discussed in the other briefs and covered in previous blogs:
- The oldest retirees. Retirees are living longer, which puts additional strain on their often-insufficient financial resources. One proposal would increase Social Security benefits for people over 85 by 5 percent.
- Widows. Widows sometimes slip into poverty when their benefits shrink – relative to the couple’s combined benefits – after the spouse passes away. One way to help would be to reduce wives’ spousal benefits while their husbands are still living and shift that income to widows’ survivors benefits.
- Mothers. Since the 1930s, Social Security has supported non-working wives through a benefit equal to half of their husbands’. But it’s very common for mothers today to work full-time – and many are unmarried – so their own earnings are more likely to determine the size of their benefit checks when they retire. Yet mothers lose out if they leave work temporarily to care for children. Some reforms would credit them for this time off to increase their benefits in retirement.
In addition to the individual policy briefs, the Center published a report summarizing all of the proposals.
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