Lawmakers consider Social Security 2100 Act aimed at protecting future benefits
The House Ways and Means Committee held a hearing to consider a new bill to reform the way Social Security works and address the retirement crisis. (iStock)
The House of Representatives held a hearing on Dec. 7 to consider a bill aimed at protecting future Social Security benefits.
"Social Security 2100: A Sacred Trust" is a plan to improve and increase benefits, protect against inflation and strengthen the Social Security Trust Fund. It was authored by House Ways and Means Social Security Subcommittee Chairman John B. Larson, D-Conn., who introduced the bill to Congress in October.
- Statement from Rep. John B. Larson (D-Conn.)
The Social Security Administration (SSA) estimates that without further action by Congress, the trust fund that pays retirement benefits will be depleted by 2033. By then, continuing tax income will cover just 76% of Social Security benefits for eligible retirees.
Social Security 2100 is essentially a "first step" toward enhancing the program, Larson said at the hearing, aiming to extend the depletion of Social Security’s funds to 2038.
Keep reading to learn more about the future of the Social Security program. And if you're looking for alternative sources of cash, consider borrowing a personal loan while interest rates are historically low. You can compare rates across multiple lenders on Credible's online marketplace.
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Subcommittee on Social Security: ‘The time for procrastination is over’
During the subcommittee hearing, Larson said that "the time for procrastination is over" and that Democrats hope to bring the Social Security 2100 Act to the House floor by the spring.
Although the bill currently has hundreds of co-sponsors and endorsements from advocacy groups, it's struggling to gain bipartisan support. All 195 lawmakers who sponsored the bill are Democrats, and during the hearing, Republicans showed reluctance to support the Social Security 2100 Act amid concerns of how to cover the cost of increased benefits.
"While I cannot support this bill, I am happy to work with Chairman Larson to get some real permanent targeted reforms enacted into law," Republican Rep. Tom Reed of New York said.
Even if Social Security 2100 is passed by the House this spring, it still faces hurdles in the Senate. So while Congress debates a bipartisan effort to bolster Social Security, the future finances of millions of seniors and disabled Americans are hanging in the balance.
While this legislation would offer long-term financial aid for Social Security recipients, some consumers may be looking for ways to meet their short-term financial needs. You can view personal loan offers on Credible for free without impacting your credit score, allowing you to find the lowest rate possible for your situation.
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What's included in the Social Security 2100 Act update?
The Social Security 2100 Act aims to protect Social Security payments against inflation by increasing the tax rate on the top 0.4% of wage earners. It would:
- Increase benefits for all beneficiaries by an average of 2% "to make up for inadequate Cost-of-Living Adjustments (COLA)."
- Improve the COLA formula to "better reflect the costs incurred by seniors" such as health care and other necessities.
- Repeal the Windfall Elimination Provision (WEP), which reduces Social Security benefits for many public servants.
- Increase the minimum benefit to 25% above the poverty line to protect low-income workers.
- Extend the solvency of Social Security by applying the current payroll tax to wages above $400,000.
The bill also includes provisions to improve benefits for widows, extend dependent benefits and provide caregiver credits. Additionally, it would end the 5-month waiting period to receive disability benefits.
If you're considering borrowing money amid Social Security uncertainty, make sure you compare your options. Visit Credible to view your borrowing options, such as unsecured personal loans.
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