Tag: Social Security

From Birch Gold Group

Thanks to a combination of economic factors that have been years (and decades) in the making, there isn’t much doubt that the Social Security program has been put in serious jeopardy.

To add fuel to the fire, some potential changes coming to SSA in 2021 might create a somewhat “new normal”.

Here’s what we mean…

First, the potential for a cost of living adjustment (COLA) still exists, although thanks to energy inflation being down 11.2%, any increase for 2021 could be negligible.

Continue reading “2021 Could Establish this “New Normal” for Social Security”

From Birch Gold Group

Back in February, we reported that next year’s Cost of Living Adjustment (COLA) from Social Security may get “infected” by coronavirus, thanks mainly to inflation.

We suggested the COLA would not be enough to cover increased prices. And it appears that’s been accurate so far this year, as food inflation almost doubled from March to April, increasing from 1.9% to 3.5%.

That level of inflation hits the pocketbook hard, especially since millions of Americans are still homebound, thanks to government-imposed “stay at home” regulations.

Continue reading “Social Security Has a Big COLA Problem (Oh, And It May Be Insolvent in 9 Years)”

From Birch Gold Group

Since 1975, the Social Security Administration (SSA) has provided automatic Cost-of-Living Adjustments (COLAs), which increase Social Security benefit payouts. For 2020, the adjustment officially ended up at 1.6%.

According to the SSA, this adjustment is “enacted by legislation that ties COLAs to the annual increase in the Consumer Price Index (CPI-W). The change means that inflation no longer drains value from Social Security benefits.”

Continue reading “Social Security COLA Lags Behind Federal Reserve’s Inflation Target”

From Birch Gold Group

There’s no doubt, Social Security has problems that urgently need to be resolved. If they aren’t addressed in a meaningful way, and soon, those problems could turn catastrophic.

Changes could be coming as soon as January. The recently appointed Social Security Commissioner, Andrew Saul, wants to do two things in an attempt to make the SSA “better,” according to MarketWatch:

1. Reopen field offices nationwide on Wednesday afternoons, restoring closings that were put in place in 2012.
2. Hire 1,100 new employees to provide service on the national 800 number and in its processing centers, where paperwork is handled.

Continue reading “Social Security Administration Proposes 2 Much-Needed Changes, But There’s 1 Big Problem”

Via The Heritage Foundation

Americans would be better off keeping their payroll tax contributions and saving them in private retirement accounts than having to contribute to the government’s broken Social Security system. Social Security’s design has, over the decades, presumed that many Americans are too incompetent to make informed decisions for themselves, but few Americans believe that the government knows better than they do what is best for them and their families. Moreover, Social Security’s financial structure effectively guarantees that workers will receive extremely low—or even negative returns—on their payroll taxes.

Social Security began as an anti-poverty insurance program, aimed at preventing workers from outliving their savings when they were no longer physically able to work. As such, Social Security was limited in nature, beginning as only a 2 percent payroll tax—and promising to never take more than 6 percent of workers’ pay. Today, Social Security’s Old Age and Survivors Insurance (OASI) retirement program takes 10.6 percent of workers’ pay, and its Disability Insurance (DI) program takes another 1.8 percent, for a combined total of 12.4 percent. This is more than most Americans pay in income taxes.

Continue reading “Is Social Security Worth Its Cost?”

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