If your loved ones are retired, chances are pretty good that they’re getting Social Security benefits. About 56 million people currently receive payments, and for retirees, each payment averages $1,236 per month. It’s a substantial source of income for older Americans, but it’s one that we may not be able to rely on forever—at least, not unless the system is substantially changed. If it isn’t, then Social Security could well run out of money.
Most Americans, seniors or not, are aware of the problem, and consider it a high priority, but not everyone agrees on how to address the issue. However, a recent AP-GfK poll indicates that a narrow majority of people agree on one thing: don’t cut monthly benefit payments.
Here’s the problem future seniors must confront: millions of baby boomers have started to retire. The first wave of them hit 65 last year. As more baby boomers retire, the Social Security system pays out more benefits — but with fewer workers to contribute to the overall pot. According to Social Security trustees, the program’s cushion of funds will run out of money by 2033; at that point, tax revenue will be only enough to cover 75 percent of benefits. Regardless of who wins the upcoming election, if Congress wants to ward off what could be a major cut to seniors’ monthly payments, they’ll have to act to address the issue.
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According to the Associated Press, the options for fixing the Social Security system generally consist of either raising taxes or cutting benefits, or a combination of the two. Raising the retirement age, which is one of the options on the table, is considered a benefit cut because future seniors would have to wait longer to qualify for Social Security payments. However, it’s an option that could prevent cuts to the actual dollar amount of monthly benefits.
How do Americans actually feel about these options? The AP-GfK poll results were revealing:
“Democrats, Republicans and Independents all favored raising the retirement age over cutting monthly payments. But there was a big divide on raising taxes. Sixty-five percent of Democrats and 53% of independents supported higher taxes, compared with just 38% of Republicans.”
We want to know our readers’ opinions, too — if you had a chance to answer the pollsters’ question of whether to raise taxes or cut benefits, which would you choose? Would you rather raise the retirement age than risk lower monthly payments for your loved ones? We’d like to hear your thoughts in the comments below.