Full Retirement Age Question Surfaces in Fox Business Panel Discussion - Fox Business; AMAC
Fox Business’s Mornings with Maria Bartiromo yesterday touched on one of the most contentious ideas for addressing the looming Social Security insolvency issue. Citing the results of a recent Reagan National Economic Forum survey in which Americans were asked to weigh in on Social Security under the current Administration, the panel was asked for thoughts in response to the issue of tax increases versus benefit changes for future retirees. The conclusion, according to Fox Host Todd Piro and Strategic Wealth Partners CEO Mark Tepper, was that extending the age for Social Security benefits represented the “easiest solution” to ward off the across-the-board benefit cut when insolvency is reached. Check out the video and transcript from the discussion here.
The posted discussion clips, unfortunately, do not shed light on whether the panel’s thoughts were focused on the early eligibility age (EEA) for benefits (62) or the normal retirement age (NRA), currently 67. They do, however, stress the logic associated with extending the age parameters as a more appropriate alternative to tax increases to shore up Social Security’s finances. Their commentary also hits the basic reason why legislative attention to the problem has been elusive for decades, with Tepper, after referencing the potential benefit cuts, commenting, “So, I think there’s better ways to do it without punishing everyone. The issue, guys, is that it’s political suicide. Like, nobody can actually go after it and try to fix it without just completely ruining their political career.”
Raising the retirement ages is a step that would alleviate a portion of the problem facing Social Security, but not the entire problem. Over a dozen recent proposals have been evaluated by the Social Security Office of the Chief Actuary suggesting changes to the EEA and NRA, with none of them projected to achieve more than half of the needed reductions in the long-range funding shortfall. So, while the age changes are a step in fixing the problem, more reforms are necessary to ensure Social Security for the next generation.
As an example of the leading thoughts on reforming Social Security for the long haul, the Association of Mature American Citizens (AMAC, Inc.) believes Social Security must be preserved and modernized to meet the demands of 21st-century economics. AMAC’s position is that this can be achieved without payroll tax increases through relatively slight program modifications, including changes to the cost-of-living adjustment (COLA) process and modifications to the formulas for calculating payments to higher-income beneficiaries. Changes to the age for maximizing benefits are included in AMAC’s position, along with (1) an increase in the thresholds where benefits are subject to income tax; (2) indexing of these thresholds annually to account for inflation; (3) improved survivor benefits, (4) eliminating the reduction in benefits for those choosing to work before full retirement age; and (5) improved savings tools for future retirees, including a savings account that builds estate value. AMAC is resolute in its mission to preserve Social Security for current and future generations and has garnered the attention of lawmakers in D.C., meeting with numerous congressional offices and staff over the past decade. To learn more about AMAC’s plans, click here.