
A pair of US senators who are pursuing a bipartisan proposal to overhaul Social Security sought to allay concerns late last week that their idea would result in reduced payouts for beneficiaries.
Senators Bill Cassidy (R-Louisiana) and Angus King (I-Maine), who caucuses with the Democrats, are spearheading a legislative proposal to reform Social Security on multiple fronts.
Social Security Proposal
As previously reported by GOBankingRates, their proposals include increasing the retirement age from 67 to 70. In addition, they have advocated establishing a sovereign-wealth fund to assist finance Social Security.
The fund might be funded by borrowing at least $1.5 trillion.
Instead, the formula for calculating monthly Social Security benefits might be changed from one based on a worker’s average earnings over 35 years to one based on the number of years worked and paid into the system.
There has been increased discussion of altering Social Security prior to the depletion of the program’s Old-Age and Survivors Insurance (OASI) Trust Fund. According to one estimate, this might occur as early as 2032, leaving the program exclusively dependent on payroll taxes, which may cover just approximately 75% of payouts.
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Advocates’ View

In a March 3 joint statement, Cassidy and King attempted to allay these apprehensions. In response to what they termed incomplete and rather alarmist stories about the idea, Senators indicated that their goal is to preserve and protect the retirement security of all Americans, both now and for future generations.
In less than a decade, the Social Security trust fund will be insolvent, according to the statement. If Congress does nothing, current law mandates harsh 24% benefit cutbacks and a bleak future for keeping our promises.
Cassidy and King stated that discussions are ongoing over their strategy and that they will share additional information after it has been “completely developed.” Nonetheless, they did hint at a few potential elements.
Numerous measures are being evaluated to protect Social Security, including capping early retirement at 62, ensuring lower-wage workers are fully protected, and identifying expedient ways to raise payments, the joint statement added. Under the approach under discussion, millions of people would enjoy an immediate rise while no one would face a decrease.
The unknown variable is if their idea even reaches a vote in Congress. It may be difficult to convince Democrats and perhaps some Republicans to support an increase in the full retirement age.
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