Q & A

Ask Rusty – Social Security ‘Notch Baby’ seeks restitution

Dear Rusty: My husband was a “notch baby” and has been collecting less Social Security than his brother-in-law who had a lesser profession. Is there any hope for correcting this? Signed: Wondering and Hopeful


Dear Hopeful: Well, the whole “notch baby” controversy has been simmering for a lot of years now and has even gotten the attention of Congress several times in past years. The term “Notch Babies” refers to Social Security beneficiaries who were born between 1917 and 1921 because they, as well as those born earlier, were caught up in an error made by the Social Security Administration when transitioning to automatic Cost of Living Adjustments (COLA) in 1972. An error in the new COLA computation, which resulted in beneficiaries being overpaid wasn’t discovered until a few years afterwards. In an effort to resolve the issue Congress ruled that for those born before 1917 the higher (incorrect) COLA formula would continue to be used, and COLA for those born in 1917 or later would use a new corrected COLA formula. But bowing to public pressure, Congress later created a transition period which said that anyone born between 1917 and 1921 would get COLA according to a special formula which was not as generous as the incorrect one used for those born before 1917, but more generous than the corrected formula used for those born after 1921. And those born between 1917 and 1921 are referred to as “notch babies” (some lobbying groups have even expanded the term to include those born up to 1926). Nevertheless, most “notch babies” feel they are losing out because they didn’t get benefits using the old incorrect COLA formula as did those born prior to 1917, even though the formula used to compute their COLA is more generous than for those born after 1921. Obviously, your husband falls into the “notch baby” category while his brother-in-law apparently benefited from the higher (incorrect) formula used for those born prior to 1917, presumably accounting for the disparity in their benefits. As for any “hope for correcting this,” Congress’ view over the years has consistently been that there is really nothing to correct because those born between 1917 and 1921 are/were receiving COLA increases using the special formula which is more generous than for those born after 1921. Currently H.R. 867 – The Notch Fairness Act of 2017 has 8 cosponsors and has been referred to the Subcommittee on Social Security, but little progress has been made in today’s political climate focused more on reducing program costs than on raising them. So, I’d have to say that I doubt if legislation addressing this issue will be successful anytime soon.


This article is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at [email protected].

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