Headlines about "Social Security - benefits, incl. coverage"
Gathered from the web by the editors at BenefitsLink.com.
Social Security Disability Insurance: Action Needed to Address Finances
"A temporary reallocation of part of Social Security's 6.2% tax rate from the OASI trust fund to the DI trust fund would ensure that both funds can pay full benefits until 2033. After that, in the absence of further action by Congress in the meantime, scheduled taxes would cover about 75% of scheduled benefits." (National Academy of Social Insurance)
[Opinion] Social Security Benefits and COLAs: Protecting Against Inflation
"Adopting the chained CPI (Consumer Price Index) in Social Security to more accurately account for changes in the cost of living is a small first step toward fixing a broken program that is currently accelerating its own demise by paying excess benefits.... One reason the system is in trouble is that the Social Security Administration is paying cost-of-living adjustments (COLAs) based on an outdated and inaccurate index that overstates changes in the cost of living." (The Heritage Foundation)
Pensions Are Top Income Source for Wealthier U.S. Retirees
"U.S. retirees with $50,000 or more in annual income are twice as likely as retirees below that threshold to say a work-sponsored pension plan is a major source of retirement funds. Instead, these lower-income retirees overwhelmingly cite Social Security as a major source of their retirement income." (Gallup)
[Opinion] Social Security Benefits and the Impact of the Chained CPI
"The current debate over adopting a new measure of inflation has many beneficiaries worried that their benefits would be cut. To the contrary, their benefits would still rise under the new measure, and benefit increases would more accurately reflect changes in the cost of living. The current index used to compute cost-of-living-adjustments, like Social Security's cost-of-living adjustment, is outdated and inaccurate, and it often overstates the rise in the cost of living." (The Heritage Foundation)
Are Millennials Ready for Social Security Reform?
"[M]illennials are getting an early start on retirement saving ... First, they have watched their baby boomer parents struggle to prepare for retirement.... Second, this age group is not relying heavily on the solvency of Social Security. In fact, less than half of those surveyed plan on relying on public programs for retirement income." (National Center for Policy Analysis)
Characteristics and Employment of Applicants for Social Security Disability Insurance Over the Business Cycle
"[The authors] find that almost all of the increase in applications and allowances during recession periods is due to increasing applications and allowances of people whose applications are either rejected or determined by vocational factors. People who apply during economic downturns also have lower income and assets at the time of application and lower earnings several years after application." (Center for Retirement Research at Boston College)
Exchanging Delayed Social Security Benefits for Lump Sums: Could This Incentivize Longer Work Careers?
"This paper explores whether allowing people to receive a lump sum as a payment for delayed retirement rather than as an addition to their lifetime Social Security benefits might induce them to work longer.... Our base case indicates that workers given the chance to receive their delayed retirement credit as a lump sum payment would boost their average retirement age by 1-1/2 to 2 years." (University of Michigan Retirement Research Center)
Push to Curb Payments to Deceased Social Security Beneficiaries Intensifies
"Despite recent progress on curbing improper payments, the federal government continues to send an unacceptably high number of checks to ineligible deceased beneficiaries, a Senate panel asserted on Wednesday. Lawmakers, auditors and agency officials embraced a series of remedies to improve accuracy of the Social Security Administration's Death Master File included in the 'program integrity' proposals in President Obama's fiscal 2014 budget." (Government Executive)
Social Security Bulletin, May 2013 (PDF)
126 pages. Articles include: Outcome Variation in the Social Security Disability Insurance Program: The Role of Primary Diagnoses; The Impact of Retirement Account Distributions on Measures of Family Income; and Contribution Dynamics in Defined Contribution Pension Plans During the Great Recession of 2007-2009. (U.S. Social Security Administration)
What Gen X Doesn't Know About Social Security
"Members of Generation X, those born between 1965 and 1976, are planning to collect Social Security at an average age of 65, according to a recent survey.... [But] Gen Xers who sign up for Social Security at age 65, as 29 percent plan to do, will see their monthly payments reduced by about 13.3 percent." (U.S.News and World Report)
Entitlement Reform and Retirement Benefits
"A change in the [Social Security Retirement Age] presents an explicit challenge for DB plans, because those plans generally premise their benefit on a normal retirement age. It also presents an implicit challenge for account-based designs like cash balance or DC plans, at least to the extent the plan design focuses on enabling a participant to accumulate an adequate benefit at some assumed 'retirement age.'" (October Three)
Chained CPI: Social Security Friend or Foe?
"President Obama's budget proposes to use the chained CPI as a more accurate way of setting the annual inflation increases for Social Security benefits. It is not a cure-all for the program's long-term funding challenge but would, by itself, eliminate about a fifth of that gap. It does so, however, by cutting benefits to most recipients." (U.S.News and World Report)
Differences Between the Traditional CPI and the Chained CPI
"The traditional versions of the CPI are based on spending patterns from a point in the past, and so do not fully incorporate the effects of consumers' substitution between various goods and services when their relative prices change.... The chained CPI-U provides a more accurate estimate of changes in the cost of living from one month to the next by using market baskets from both months, thus 'chaining' the two months together." (Congressional Budget Office Blog)
Administrative Law Judges Sue Social Security Administration Over Case 'Quotas'
"Judges struggling to handle a surge of disability cases sometimes award benefits they might otherwise deny in order to clear cases faster so they can meet quotas imposed by the Social Security Administration, according to a lawsuit filed by the union representing the agency's administrative law judges.... 'Many administrative law judges find themselves pressured to grant more claims than they otherwise would because a decision awarding benefits is less complex and time-consuming than a decision which denies benefits,' [said the president of an association of administration law judges]." (WWBT-TV NBC)
[Opinion] CBO Testimony: Using the Chained CPI to Index Social Security, Other Federal Programs, and the Tax Code for Inflation
"The chained CPI grows more slowly than the traditional CPI does: an average of about 0.25 percentage points more slowly per year over the past decade. As a result, using that measure to index benefit programs would reduce federal spending for Social Security, federal employees' pensions, Medicare, Medicaid, and various other programs.... If all uses of the traditional CPI in mandatory programs and the tax code were switched to the chained CPI starting in calendar year 2014, mandatory spending would be reduced by a total of $216 billion between fiscal years 2014 and 2023, and federal revenues would be increased by $124 billion." (Congressional Budget Office)
The Interaction of Social Security Disability and Retirement Benefits
"[A claimant who] has been collecting Social Security disability benefits on her own earnings record ... is not able to file a restricted claim for spousal benefits only when she turns 66. That claiming strategy is available only to someone who is filing for benefits for the first time at full retirement age.... [In] order to file a restricted claim for spousal benefits only, you must be eligible for both a retirement benefit on your own record and for a spousal benefit at full retirement age." (Investment News; free registration required)
Not So Hale and Hearty: Explaining Disability Rates in One Alabama County
"[A]bout one in five Hale County [Alabama] residents between 20 and 64 receives disability benefits from Social Security or Supplemental Security Income ... That's far above the national average of about one in 16.... Several facts make Hale County an outlier:  An unusual age distribution....  Low educational attainment....  A lopsided industry mix." (Center on Budget and Policy Priorities)
The Interplay of Wealth, Retirement Decisions, Policy and Economic Shocks
"The decision to retire depends on a number of factors including earnings and health shocks, demographic characteristics, preferences, pensions, and social security.... [I]ncreasing the [eligibility age of retirement] results in sizeable responses to the age of retirement but does not affect health outcomes very much. A 20 percent reduction in wealth induces households to delay retirement by one year, on average, with poor households being relatively unaffected." (University of Michigan Retirement Research Center)
Get the Facts on 'File and Suspend' Strategy for Social Security Benefits
"By now most advisors have at least heard of the 'file and suspend' strategy for couples to maximize their Social Security benefits. If only all the good folks working in Social Security's offices were familiar with it, this couple would have had a much easier time. Throw in a federal pension and what used to be an easy decision can become very complex." (Morningstar Advisor)
How Obama's Budget Impacts Retirement Savers
"Chained CPI.... New retirement account limits.... Automatic IRAs.... Close the Medicare Part D donut hole sooner.... Higher premiums for high income Medicare beneficiaries.... New Medicare co-pays." (U.S.News and World Report)
[Official Guidance] Text of the White House's Proposed 2014 budget
"Here's President Obama's $3.77 trillion budget proposal for 2014. The plan proposes new [spending] in infrastructure and education, major new taxes for the wealthy, and reforms aimed at reducing the cost of Social Security and Medicare." (The Washington Post)
Does Access to Health Insurance Influence Work Effort Among Disability Cash Benefit Recipients?
"There is considerable policy concern about 'DI lock' -- that tying public health insurance coverage to cash disability benefit receipt contributes to the low exit rates due to work.... [I]ncreasing health insurance access does increase the likelihood of positive earnings among a subset of disability beneficiaries. [This study finds] evidence of SSI lock among beneficiaries with some Medicaid expenditures and find that both non-group health insurance regulation and generous Medicaid eligibility help alleviate the problem." (Center for Retirement Research at Boston College)
[Official Guidance] From SSA: FAQs for Individuals About the Potential Private Benefit Information Notice
"[Question:] I received an SSA Potential Private Retirement Benefit Information notice. What does this mean? [Answer:] This notice was sent to you by the Social Security Administration (SSA) because you filed a claim for social security benefits. It is a reminder about private employer retirement benefits that you have earned, also called 'deferred vested benefits.' The [IRS] provided this information to SSA. The information is provided to the IRS by the plan administrators of the private retirement plans that you participated in while you were an employee. You may have already received some or all of these benefits." (Employee Benefits Security Administration)
[Opinion] Expansion of Social Security: A Plan to Increase Retirement Security
"Retirement security is often thought of as three-legged 'stool' consisting of Social Security, employer retirement plans, and private savings. Social Security has been far more stable and successful than the other two legs of the stool. The reliance on these other legs of the system has resulted in a retirement security crisis for most Americans, shifting costs and risks onto individuals, even as the benefits of these programs go overwhelmingly to upper-income earners.... Instead of compounding failure by expanding private benefits, a category that includes rapidly-disappearing defined benefit pensions, employer-provided 401(k)s and individual retirement accounts (IRAs), we should substantially expand the successful, purely public Social Security program." (New America Foundation)
Tax Considerations for the Pending DOMA Decision: Should Health Plan Sponsors Take Action by April 15?
"If the U.S. Supreme Court holds that section 3 of DOMA is unconstitutional, it would appear that same-sex spouses would be eligible for certain tax-free employer-paid health benefits and, as a result, employers may be entitled to a refund of their share of any FICA taxes paid and employees may be entitled to a refund of their share of both FICA taxes and income taxes.... As April 15, 2013 is the deadline for filing a protective refund claim for 2009 calendar year taxpayers, employers may want to consider filing protective FICA tax-refund claims for all open payroll tax periods to cover the FICA taxes paid on this imputed income." (Morgan Lewis)
Reforming the Taxation of Retirement Income
"This article [examines] the three major sources of retirement income: Social Security, employment-based retirement plans, and personal savings ... [and] considers how retirement income is generated, sets forth the applicable federal income tax treatment, and proposes reforms to make the pertinent tax rules more sensible.... [R]ecommendations [include] simplifying how Social Security retirement benefits are taxed, bifurcating defined contribution plan withdrawals into capital gains and ordinary income components, repealing certain exceptions to the early distribution penalty, reducing the delayed distribution penalty and adjusting the age at which it is triggered, and changing the residential gain exclusion to avoid unanticipated problems with reverse mortgages." (Richard L. Kaplan of the University of Illinois College of Law)
Social Security's Fiscal Year 2014 Annual Performance Plan and Revised Final FY 2013 APP
"The Annual Performance Plan for FY 2014 and Revised Final Performance Plan for FY 2013 (APP) ... establishes FY 2013 agency-level performance measures and targets, as well as those proposed for FY 2014. The APP is also part of the agency's annual budget request[.]" (Social Security Administration)
The Changing Causes and Consequences of Not Working Before Age 62 (PDF)
"This study considers nonworking older adults and their channels of support before qualifying for Social Security benefits. Using 18 years of data from the Health and Retirement Study, [the authors] ... explore the effects of various factors on the likelihood of being a nonearner and observe the consequences of not working during one's 50s with regard to poverty, age of Social Security claiming, and overall retirement satisfaction. Finally, [they] analyze how these relationships have changed over time, particularly after the Great Recession." (Urban Institute)
Obama Budget Would Cut Entitlements in Exchange for Tax Increases
"White House officials said ... that Obama's budget would cut Medicare and Social Security and ask for less tax revenue than he has previously sought.... Obama proposed changing the cost-of-living calculation for Social Security in a way that will reduce benefits for most recipients, a key Republican request that he had earlier embraced only as part of a compromise." (The Washington Post)
Definition of Long-Term Disability in Policy Was 'Functionally Equivalent' to SSA Definition
"The Seventh Circuit had a very difficult time wrapping its head around the notion that the participant could be disabled under SSA, but not disabled under the Cigna policy, especially after Cigna helped the participant demonstrate that he was disabled to the SSA.... The Seventh Circuit framed the pertinent question as 'whether Cigna has a plausible explanation for the difference in the final determinations of disability, an explanation that would lead a reviewing court to conclude that the difference was not based on the structural conflict of interest that is present here'[.]" (James E. Arnold & Associates, LPA)
The National Economic Security Standard Index: Social Security Benefits Are Not Enough (PDF)
"[N]either income at the federal poverty level nor the average social security benefit provides enough income to cover basic living expenses.... The average Social Security benefit for a retired worker was $14,105 in 2011. The estimated average benefit for a couple was $22,895.... The national Elder Index shows that single individuals need $19,104 to $28,860 annually, depending on whether they live in an owned, rented, or mortgaged home. Couples need between $29,448 and $39,204 to meet expenses." (Gerontology Institute, University of Massachusetts Boston)
Now Entering the Pension Offset Zone -- A Social Security Nightmare
"If you receive a pension from a federal, state or local government -- including some public school systems -- for work where you did not pay Social Security taxes, your spouse's or widow's or widower's benefits may be reduced or even eliminated. The GPO rule applies only to Social Security benefits as a spouse or survivor.... And don't think you can skirt the GPO rule by electing a lump sum annuity payment of your government pension. Social Security will calculate the reduction as if you chose to get a monthly benefit from your government work." (Investment News)
When Should Clients Start Taking Social Security Benefits?
"[An] individual investor who takes benefits at age 62 must achieve returns of 7% or higher in retirement in order to be better off than someone who delays until age 66, assuming an average life expectancy. In contrast, an investor taking Social Security at 66 would need returns of 4.6% or higher to be better off than someone delaying until age 70." (Financial Planning)
[Opinion] Why Social Security Is the Best Retirement Saving Vehicle
"Social Security stays unfunded and sustainable because of two of its other features: It is universal, and it has a dedicated tax source. If an unfunded benefit grows to have a surprisingly large cost, but it only covers a small share of the population, the government is likely to end up simply passing that cost along to taxpayers. That's hard to do if almost everyone is a participant." (Bloomberg)
Text of CBO Testimony on the Social Security Disability Insurance Program: Funds Run Out in Three Years (PDF)
"In the past four decades, the number of workers with disabilities who receive benefits from the [Social Security Disability Insurance ('DI')] program has increased nearly sixfold, rising from 1.5 million in 1970 to 8.8 million in January 2013.... Since 2009, the program has paid out more each year in benefits than it received in dedicated revenues..... In 2023, CBO projects, the program's spending will be 0.82 percent of GDP, and dedicated tax revenues will be 0.66 percent of GDP. CBO projects that the DI trust fund will be exhausted in 2016, nearly 20 years before the projected exhaustion of [the] trust fund for the Social Security retirement program." (Congressional Budget Office)
Rethinking Normal Retirement Age for Pension Plans (PDF)
"Key Points[:]  Aligning the normal retirement age for DB plans with the Social Security normal retirement age would facilitate and encourage more workers to remain in the workforce longer.  Changes to ERISA should allow, but not require, employers to increase their normal retirement age.  Transition rules should be considered carefully." (Pension Committee, American Academy of Actuaries)
Income Composition, Income Trends, and Income Shortfalls of Older Households (PDF)
"In 2009, households ages 65-74 and households with members age 85 or above received 54 percent and 66 percent of their total household incomes, respectively, from Social Security benefits.... For households that had members ages 65-69 in 2001, the share of household income derived from Social Security rose from 47 percent in 2001 to almost 60 percent in 2009.... In 2009, households ages 65-74 received 17.1 percent and households above age 85 received 15.3 percent of their incomes from pensions and annuities." (EBRI)
Why Some Americans Might Get Less Social Security
"Roughly one million Americans are receiving less Social Security than they were expecting, and the group includes teachers, firefighters, police officers, college professors, state troopers, park rangers, highway maintenance crews and federal workers hired before 1984. All of these individuals have one thing in common: in addition to Social Security, they're also eligible for a government pension either at the federal, state or local level." (FoxBusiness.com)
[Opinion] Have Seniors Really Paid for Medicare and Social Security?
"Few seniors have actually paid for their Medicare benefits. According to an Urban Institute estimate, the typical retired couple paid $122,000 in lifetime Medicare taxes but can expect to receive benefits worth $387,000. Social Security is another story. There, the average retired couple paid $600,000 in lifetime taxes for $579,000 in benefits. Put together, it's $722,000 in taxes for $966,000 in benefits." (The Washington Post; free registration required)
Can I Receive Social Security Benefits from Two Countries?
"Q. My husband, an American citizen, and I were married in 1990, and I became an American citizen in 2000. But all of my working days were in Canada, and I will be eligible to collect Old Age Security from there. Will I also be eligible for a Social Security spousal benefit? A. You should be OK, provided you and your husband meet the qualifications for a spousal benefit.... The Government Pension Offset, which can reduce a benefit if you get a U.S. federal, state or local government pension, doesn't apply to foreign pensions." (AARP)
[Opinion] Five Ways to Fix Social Security
"Here are five potential Social Security changes, and how much of the budget shortfall they would address: Increase Social Security taxes.... Lift the payroll tax cap.... Raise the retirement age.... Means-test.... Change the cost-of-living adjustment." (U.S.News and World Report)
What's Your Social Security Break-Even Age?
"The key things to keep in mind for [these three example] claiming ages is that someone who claims at 62 will receive benefits equal to only 75 percent of what they'd get if they wait until their full retirement age. And someone who waits until they turn 70 to claim will receive 132 percent as much as they would get by claiming at age 66." (U.S.News and World Report)
[Opinion] One Recession Cost Is Lower Social Security Benefits
"[T]here is a huge financial price to be paid for drawing Social Security benefits early and an enormous payoff for delaying the decision to claim benefits. Unfortunately, ... many workers have a 'use it or lose it' attitude, incorrectly thinking their benefits will be bumped up when they reach the full retirement age or ignorant that their benefits rise when receipt of them is delayed." (The New York Times; free registration required)
Strengthening Social Security: What Do Americans Want? (PDF)
"Americans don't mind paying for Social Security because they value it for themselves (80%), for their families (78%), and for the security and stability it provides to millions of retired Americans, disabled individuals, and children and widowed spouses of deceased workers (84%). -- 84% believe current Social Security benefits do not provide enough income for retirees, and 75% believe we should consider raising future Social Security benefits in order to provide a more secure retirement for working Americans.... 87% want to preserve Social Security for future generations even if it means increasing taxes paid by wealthier Americans." (National Academy of Social Insurance)
How Will Older People's Participation in the Labor Force Be Affected by the Coming Increase in the Full Retirement Age for Social Security?
"CBO expects that the share of older people who work will increase in the latter part of this decade in response to the scheduled increase in the full retirement age (FRA) for Social Security. As a result, economic output will be slightly greater and budget deficits slightly smaller than would otherwise be the case.... CBO expects that the effect of increasing the FRA from age 66 to age 67 will be similar to the effect of increasing it from age 65 to age 66." (Congressional Budget Office)
Social Security Shortfall: It's Worse Than You Think
"For the first time in more than a quarter-century, Social Security ran a deficit in 2010: It spent $49 billion dollars more in benefits than it received in revenues, and drew from its trust funds to cover the shortfall. Those funds -- a $2.7 trillion buffer built in anticipation of retiring baby boomers -- will be exhausted by 2033, the government currently projects. Those facts are widely known. What's not is that the Social Security Administration underestimates how long Americans will live and how much the trust funds will need to pay out -- to the tune of $800 billion by 2031, more than the current annual defense budget -- and that the trust funds will run out, if nothing is done, two years earlier than the government has predicted." (The New York Times; free registration required)
[Guidance Overview] New Tax Rates in Effect for 2013
"[E]ffective January 1, 2013, the Social Security Tax holiday that was in effect in 2011 and 2012 has expired. As a result, the employee-side social security tax withholding rate for 2013 is 6.2%. The Social Security wage base for 2013 is $113,700.... Effective January 1, 2013, the Medicare tax rate applicable to wages in excess of $200,000 ($250,000 for married individuals filing jointly; $125,000 for married individuals filing separately) will increase to 2.35%. Employers are required to withhold and report Medicare tax at the 2.35% rate on all wages over $200,000 with respect to their employees. The Medicare tax on wages of $200,000 or less will remain at the 1.45% rate." (Baker & McKenzie)
Why Is Age 65 Still a Retirement Peak Despite New Minimum of Age 66 for Full Social Security Benefit?
"When Social Security's Full Retirement Age (FRA) increased to age 66 for recent retirees, the peak retirement age increased with it. However, a large share of people continue to claim their Social Security benefits at age 65. This paper explores two potential explanations for the 'stickiness' of age 65 as a claiming age: Medicare eligibility and workers' lack of knowledge about their future Social Security benefits." (Center for Retirement Research at Boston College)
Disability Growth Disables the Country
"Since 1991, workers on [Social Security] disability increased almost 170 percent, from 3,194,938 to 8,575,544. In the same period, the population between 18-64 increased only 26 percent, from 155,263,000 to 196,263,504. The increase is occurring despite the Americans with Disabilities Act passed in 1990 prohibiting employment discrimination and requiring businesses to make reasonable accommodations for those with disabilities." (National Center for Policy Analysis)
'Chained-CPI' Inflation Gauge Would Hurt Social Security Recipients
"[C]hained-CPI assumes that as prices increase, consumers make substitutions in what they purchase.... Social Security provides at least half of total household income for 65 percent of all aged beneficiaries. And for non-married beneficiaries, that figure rises to 74 percent, or nearly three-quarters of their income. For more than a third of all older beneficiaries, Social Security provides 90 percent or more of total income, while for non-married beneficiaries that figure rises to 46 percent. These are the people who would suffer most under a chained-CPI[.]" (CBS MoneyWatch)
[Opinion] The Technical Trick Washington Wants to Use to Cut Social Security and Medicare Benefits
"'Chained-CPI' cuts Social Security benefits and increases taxes. That's why it's part of the negotiations.... Chained-CPI, in this telling, is simply an effort to correct a measurement error in the way we calculate inflation. It's a tweak, a fix, a policy designed to achieve a higher level of technical precision. And who could be against that? ... The effort to mask cuts in technical adjustments just leads to worse cuts, as the top priority isn�t protecting the poorest or improving the program, but finding a policy sufficiently confusing that you can pass it before most people realize what it is." (The Washington Post; free registration required)
AARP Returns to Hard Line Against Benefit Cutbacks
"AARP now appears to have veered back to a hard-line position of opposing any cutbacks in Medicare or Social Security and is seeking to keep those programs off the bargaining table altogether.... If the Chamber of Commerce is the lead voice of business leaders on the right in opposing increased taxes in the deficit talks, AARP plays a similar role on the left in opposing benefit cuts. It hopes to meet or make contact with the office of every member of Congress before a deal is done." (The New York Times; free registration required)
U.S. Census Bureau Projections Show a Slower Growing, Older, More Diverse Nation a Half Century from Now
"According to the projections, the population age 65 and older is expected to more than double between 2012 and 2060, from 43.1 million to 92.0 million. The older population would represent just over one in five U.S. residents by the end of the period, up from one in seven today. The increase in the number of the 'oldest old' would be even more dramatic -- those 85 and older are projected to more than triple from 5.9 million to 18.2 million, reaching 4.3 percent of the total population." (U.S. Census Bureau)
Everything You Need to Know About Chained CPI in One Post
"When propane costs go up, CPI-U and CPI-W include that as an increase in the cost of living. But some people would just stop using propane if its price went up. They'd switch to electric heating, or a geothermal system, or a wood stove. So their actual heating costs wouldn't go up as much as CPI-U and CPI-W would suggest. Chained CPI attempts to take 'substitution effects' like this into account. Thus, its number generally rises more slowly than other metrics. That adds up to a big cut in Social Security benefits." (The Washington Post; free registration required)
Would Use of Means Testing Help Social Security? (PDF)
"Advocates argue that means testing would reduce costs to the Social Security program. But such a move could have serious unintended consequences, including erosion of public support for Social Security, savings disincentives during working years, and administrative complexity. Social Security already includes an 'earnings test' based on the principle that Social Security payments should replace lost earnings, and it is therefore appropriate to reduce benefits for those whose earnings indicate that they have not yet retired. Policymakers seeking to avoid means testing could achieve much of the same results by adjusting the benefit formula for highly compensated individuals or by increasing the taxation of Social Security benefits at a higher rate than the one currently used." (American Academy of Actuaries)
[Opinion] The People's Pension: Social Security Was Designed in Secret with Bad Assumptions
"A fundamental paradox of Social Security is that while it was perhaps the most populist program the federal government ever created, welcoming all American workers as participants regardless of need, crucial decisions about it were always made by a remarkably small group of policymakers. Congressional committee chairs, actuaries, and a few influential outside policy strategists managed the evolution of the program, always in near-total isolation from the public." [Editor's note: The linked article is a review of the book, "The People's Pension: The Struggle to Defend Social Security Since Reagan," by Eric Laursen; the foregoing quote is from the book.] (Burypensions)
CBO's Long-Term Projections for Medicare and Medicaid Spending in the United States
"If current laws remained in place, spending on the major federal health care programs would grow from more than 5 percent of GDP today to almost 10 percent in 2037 and would continue to increase thereafter. The aging of the population and the rising cost of health care would cause spending on the major health care programs and Social Security to grow from more than 10 percent of GDP today to almost 16 percent of GDP 25 years from now. By comparison, spending on all of the federal government's programs and activities ... has averaged 18.5 percent of GDP over the past 40 years." [Editor's note: The linked item is a set of 15 slides at a presentation to the "OECD Expert Workshop on Improving Health Expenditure Forecasting Methods."] (Congressional Budget Office)
[Opinion] Economists Agree: No Empirical Basis for Reducing the Social Security COLA (PDF)
"[T]he annual Social Security cost-of-living adjustment (COLA) should be based on the most accurate measure possible of the impact of inflation on beneficiaries. For this reason, [the authors] oppose proposals to reduce the Social Security COLA by tying it to a chained consumer price index that does not directly measure the actual expenditures of beneficiaries. Such a move would lower the COLA by an estimated 0.3 percentage points per year, translating into a 3 percent benefit cut after 10 years and a 6 percent cut after 20 years." (Economic Policy Institute)
Hold Out or Opt Out? Deciding Between Retirement and Disability Applications in Recessions
"[E]stimates indicate that retirement beneficiaries are more likely to apply for SSDI as unemployment increases -- and, conversely, eligible individuals who have not yet claimed benefits are less likely to apply when unemployment rises. But after accounting for unobserved characteristics associated with both the decision to apply for disability insurance and Social Security benefits, individuals are no more likely to apply for disability benefits when unemployment is high." (Center for Retirement Research at Boston College)
Four Costly Mistakes that Retirees Make about Social Security
"What is the biggest fear of today's retirees? Running out of money. What can Social Security offer? Guaranteed income for life that increases over time. Seems like a match made in heaven. Yet 70% of retirees continue to claim Social Security benefits before their full retirement age, even though their benefits will be reduced for life." (Investment News; free registration required)
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