Social security solutions well in hand…lawmakers wake-up!

 

                                    One of the looming economic quagmires ahead is how to modernize social security to keep it solvent for our current and future seniors. There are a host of changes that can be implemented. There is a way we can fortify social security though tax fairness and common sense. All current and future promised payoffs will be unaffected.

                    First off, and many are not aware, that there is an artificially low tax cap on wages that social security is paid on. Currently, any taxpayers earnings in excess of $107,000 a year is  done paying social security tax for any given year. Billionaires are only contributing social security tax on 107,000 of their income. Social security isn’t a pension plan, it’s a government safety net for millions. We never guaranteed anyone a dollar for dollar return. How many people contribute all their life, only to die before retirement age..with a paltry settlement paid to a spouse or family? The social security cap should be raised to $250,000 per year…with an “ss excise tax” added to millionaires to further fortify the social security fund. While the tax rate of 7.65 on social security has remained frozen for decades, a small adjustment is not unwarranted. Raise it by .35% to 8%..with the employer matching the same. A minor bump up for all tax payers …everybody must be part of the solution.

             We can also implement a means testing program for wealthy seniors. If you reach retirement age…and you have personal assetts  of two million dollars or more…your social security payment will be reduced by 10%. For those with personal assets of over 5 million dollars, the social security payout is reduced by 25%. Both  groups could be offered an early buyout settlement..an actuarial  payoff where those rich seniors can accept an early payoff which would get them off the social security roles  and save additional money.

      Some age adjustments have long been part of insuring the solvency of social security. As we know, people are living longer and longer, and we must make some realistic adjustments here as well. Those citizens under 30 should have their full retirement age set back to 70..with an early retirement option at 65. Another needed adjustment would be to raise the current early adjustment payouts. Millions have been forced out of the work force, with many unable to find jobs…. depending on that early retirement income. This amount needs to be adjusted to help the millions caught in our economic malaise. Another positive change, would be to increase the amount seniors can earn without losing money back to social security. Currently , a senior can earn 14,000 from a job…then they must pay back 50% over that amount back to the government as social security reimbursement. Senior cap on this reimbursement needs to be raised to a more modern amount , perhaps $25,000.

        A  myriad of option are open to our lawmakers. Smart folks on either side of the aisle can take the lead and start solving problems. We can solve issues,  political parties need to put the best interests of the country front and center. Partisan squabbling is not the message sent in 2012. Let’s seize the moment and get the job done.





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