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How to fix Social Security

By Jennie L. Phipps · Bankrate.com
Monday, February 7, 2011
Posted: 4 pm ET

Here's a little retirement planning exercise. See if you agree.

If you ruled the world and you could fix Social Security, how would you do it?

The University of Maryland Program for Public Consultation asked that question of about 2,000 people and found that given a series of possibilities and the percentage of the problem each would fix, 75 percent were willing to make choices that eliminated the shortfall.

About 60 percent of respondents were able to make enough changes to Social Security to put it on solid footing and at the same time, raise benefits to low-income retirees.

Here are the choices that people made:

  • Raising payroll tax limit to $156,000 solves 25 percent of the problem and 83 percent found it tolerable.
  • Completely eliminating the payroll tax limit solves 75 percent of the problem and 78 percent found it tolerable.
  • Calculating starting benefits based on the inflation rate of prices not wages solves 25 percent of the problem and 79 percent found this tolerable.
  • Adjusting cost of living increases to buying patterns most relevant to older Americans solves 25 percent of the problem and 75 percent found it tolerable.
  • Raising the retirement age to 68 by 2034 solves 13 percent of the problem and 65 percent found it tolerable.
  • Raising the retirement age to 70 by 2048 solves 38 percent and 41 percent found it tolerable.
  • Increasing the Social Security tax 1 percent over 20 years solves 75 percent of the problem and 85 percent found it tolerable.
  • Reducing benefits by 25 percent overall solves 50 percent of the problem and 19 percent found it tolerable.

If we can agree to this extent on making these hard choices, why can't our elected representatives do the same thing?

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26 Comments
Norman Caron
March 30, 2011 at 2:16 pm

I urge everyone to foward this article to your respective Senators and Congressmen!

christina griffin
March 27, 2011 at 12:58 am

I like others in these comments have worked over 40 years paying into social security all those years and forced to live a hard life through no fault of my own because my father was murdered when i in early twenties which gave me mental breakdown. Because of this mental trauma my education was reduced to 5th grade level. so i have been doing menial jobs ever since. I have worked hard i need my money at 62. Why don't you cut out social security for the very rich who don't need it, and only give it to those who do which is what it was intended in first place.

Fred Ranahan
March 25, 2011 at 6:44 am

I totally disagree with reduced benefits or increasing the age for qualifying.I feel in my heart that since ss was raided illegally by politicians..another scenario sits better with me..and that would be to suspend or eliminate health care benefits,pensions,and insurance guaranteed for life for senators/congressmen, and other politicians that served less than 25 years..including judges/presidents/xpesidents/school teachers/police/and firemen..this would fix social security..balance an uneven playing field..and enable the other 85% of honest johns to live a decent stable life in their golden years.just sayin'

Rich Mackey
March 24, 2011 at 2:34 pm

I agree with Bob. Stop takig the SS retirement money to pay for special projects that a number of our politicans come up with when it comes time to vote on a new budget. I feel strongly that it is time to take care of this country, instead of trying to take care of the countries around the world. We give billons of dollars to countries and that is taking away from the tax payers of this country who has no say in giving other countries billions. Lets take care of this country before it is to late, if it is not already. Keep our tax money at home and help the people of this country. We fault for our freedom over the years, so lets take care of ourselves for a change. There are to many politicans selling us out and I do not like it at all. My uncle Jim, cousin Bert,George,Pat,brothers Don and Ed and myself served our country, and one other freind, his name Col. Bruce Wells (deceseaed) served in WWII,Korea,Veitnam and the Gulph wars. I am glad to have known him. There are so many others that gave it all for this country, so stop giving it away. We need it here, our government to support the people of this country. I could go on, but I hope I got my point across.

Bob
March 19, 2011 at 8:03 am

If the government would stop raiding Social Security and replacing the money with worthless IOU's, we wouldn't have to keep raising the retirement age. Let's face it they can't even balance a budget and until we stop electing and re-electing these people to public office, we are getting what we deserve.