Social Security is a government program that provides financial support to retired and disabled individuals. It is funded through payroll taxes, which are deducted from workers’ paychecks. Over the years, there have been discussions about potential changes to the Social Security system to ensure its long-term sustainability.
One proposed change is adjusting the way cost-of-living adjustments (COLA) are calculated. Currently, COLA is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Some experts argue that using a different measure, such as the Consumer Price Index for the Elderly (CPI-E), would more accurately reflect the spending habits of seniors.
Another proposed change is raising the payroll tax cap. Currently, workers only pay Social Security taxes on the first $142,800 of their income. Raising this cap would result in higher-income individuals paying more into the system.
Congress is also considering increasing the full retirement age. This is the age at which individuals can receive their full Social Security benefits. It is currently 67 for those born in 1960 or later. Some proposals suggest gradually increasing the full retirement age to 68 or 69.
These potential changes to the Social Security system are complex and have implications for millions of Americans. It is important for Congress to carefully consider the impact of any changes to ensure the long-term viability of the program.