Social Security Benefit Cuts In 2017 May Curb Trump's Plans

Investors Business Daily ^ | Dec. 29, 2016 11:53 AM ET | JED GRAHAM

[expat_panama]

Social Security benefits will be cut at the start of 2017 for everyone who has yet to turn 62.

Those cuts will grow in each year to 2022, reaching 7% for everyone now 56 and under, as the official retirement age rises two months per year to 67.

Those benefit cuts are part of the daunting math for Social Security and the federal budget that could cause speed bumps for, or perhaps even curb, President-elect Donald Trump's big fiscal plans.

1) Once the retirement age rises to 67, Social Security's early retirement penalty will cut annual benefits by 30%...

2) The Congressional Budget Office affirmed last week that Social Security's Trust Fund is on course to run out in 2029...

3) If you take that 29% cut on top of a 30% early retirement penalty, those retiring at 62 would get just 50% of their current full-retirement benefit, essentially abandoning the idea of a Social Security safety net for early retirees.

4) In January, the CBO will... ...show a Social Security cash shortfall of $450 billion in 2027 alone...

...the day of reckoning for Social Security, which has always been comfortably off in the distance, now appears to be just around the corner...

...GOP proposals to reform Social Security would further hike the official retirement age, while raising the earliest retirement age, now 62, in tandem. That approach would avoid further increases in penalties for retiring early...

...Yet a rise in the earliest retirement age would most affect those who have difficulty extending their careers and little savings to fall back on. Social Security Administration data show that about 30% of beneficiaries in their early 60s rely on the program for at least 80% of total income.

[goldstategop]

Aging population, fewer workers paying into the system.

Eventually, Social Security will be funded out of general tax revenue to cover the shortfall.

But even that won’t be enough to ensure people can manage their retirement years.

[Doogle]

Stop putting other “programs” under Social Security.... like benefits for illegals and it
MAY last longer

[rb22982]

As scary as the SS deficit is, medicare (and other gov funded healthcare) is going to be worse. IF we/Trump can convert more part time jobs to full time and add more jobs period, that will help extend the SS problem for a while longer. But reductions in benefits, tax increases, or both are coming for SS/Medicare at some point in the not so distant future. The money simply isn’t there.

[Cowboy Bob]

Just Curious... When people on Welfare reach the age of 65, do they retire and begin drawing Social Security?

[Robert DeLong]

Exactly.

[Fresh Wind]

The Socialist Security piggy bank has been raided too many times.

[Robert DeLong]

The short answer is no, but here is an article that explains why.

[Robert DeLong]

However, they do get Medicare benefits.

[expat_panama]

A very happy last trading day of the year ot all! 

We starting the fun early too w/ futures seeing both our stocks and our metals up almost a third of a % --on top of yesterday's steady basing.  OK, the fact that over the past half year gold & silver are down 20%, we can put off doing anything about it by making that stuff yet one more new year's resolution.  At least our stocks are up 10% for the year.

The only econ reporter than hasn't gone off for the weekend: Chicago PMI --right after the bell.

Threads:

Larry Kudlow Would Bring Reason To An Economics Profession That's Become Ridiculous

Erie Insurance plans $135 million expansion, 600 new jobs (PA)

Verizon to add 300 full-time jobs at Huntsville call center (Alabama)

[VRWC For Truth]

Al Bortions lock box ...

[HotKat]

No, but they get an unearned tax credit.

[odawg]

“In January, the CBO will... ...show a Social Security cash shortfall of $450 billion in 2027 alone...”

Peanuts compared to the trillions wasted in the Middle East. Those trillions, along with the hundreds of billions wasted on illegals, would come in handy right now.

[utax]

All you need to know about Social Security is Ida Mae Fuller.

[poinq]

SS is an easy problem to fix. The numbers suggest that adding just 3 months to the retirement age and 1 year to the early retirement age would make the system solvent.

62 year olds can work. Age is not a factor. They may have some other issue like a disease or other health issue. But age alone does not stop people from working at 62.

[Tolerance Sucks Rocks]

I thought there was already a penalty for retiring at 62, and that the nominal retirement age was already 67.

[fella]

Wouldn’t it be interesting if the Congress critters lived under the same laws that they make for us ‘little people’.

[Skooz]

They won’t Social Security retirement. But, they will get SSI aged benefits.

[dljordan]

“62 year olds can work. Age is not a factor. They may have some other issue like a disease or other health issue. But age alone does not stop people from working at 62.”

I’m 67 and still at work every day. My wife wants me to retire but I keep asking her, why? I’m still paying for people who never worked a day in their lives.

[nclaurel]

Stop all benefits to illegals and countries that don’t need it or that hate us and we could better take care of Americans.