WASHINGTON (AP) – Social Security recipients will receive a modest 1.3% livelihood increase in 2021, but this may be short-lived amid concerns about coronavirus And its consequences for older people.
According to an estimate released Tuesday by the Social Security Administration, there is an increase of $ 20 per month for the average retired worker. This will follow an increase of 1.6% This year for cost-of-living adjustments, or cola.
The COLA affects the personal finances of 1 to 5 Americans out of nearly all 70 million people, including Social Security recipients, the disabled elderly, and federal retirees.
Economic decline from virus Reduced tax collections for Social Security and Medicare, possibly worsening their long-term financial status. But there has been no real discussion of any program in a personally charged electoral contest between President Donald Trump and Democrat Joe Biden..
“It is very difficult to talk about anything policy-director,” said nonpartisan Senior Citizen League analyst Mary Johnson. “We are witnessing a period where inadequacies in social security benefits are increasing, especially for those with lower-medium benefits.”
With a just announced COLA, the estimated average Social Security payment for a retired worker would be $ 1,543 a month next year. The profits of a typical couple will increase from $ 33 to $ 2,596 per month. The program’s rise in automatic inflation is quite unique, as most private pensions do not offer the same adjustments.
But Diana Lockrix of Omaha, Nebraska, says her cola doesn’t reduce the cost of most health care. And he has new responsibilities. His eldest daughter and two grandchildren moved in with him this summer, when the daughter’s landlord decided to sell the rented house.
LaCroix, retired from customer service jobs, is now buying diapers for a few days as she searches for good deals on hand sanitizer. “Got something to give,” he said. “Something’s got to change.”
65 year olds went to Trump in 2016, But some votes in this election showed Biden with Trump or even further with older voters.
Trump has kept his promise not to cut Social Security benefits, but this summer he sent misleading signs with a plan to temporarily suspend the collection of certain taxes that fund the program. While White House staffers said it was a limited measure that would have no lasting effect, Trump indicated to reporters that he had very large tax cuts in mind. At the beginning of the year, he told an interviewer that he wanted to deal with “eligibility”, or benefit programs, in a second term.
Biden has a social security plan that will revise the COLA and peg it into an inflation index that closely reflects the change in costs for older people, especially health care. This has been a priority for advocates. He would increase the minimum benefit for low-income retirees, addressing financial hardship among the elderly.
The former vice president raises Social Security taxes by applying payroll tax for earnings above $ 400,000 per year. The 12.4% tax, evenly distributed among employees and employers, currently only applies to the first $ 137,700 of an individual’s earnings. According to the Nonparison Urban Institute, Biden’s proposed benefit would pay a tax increase for the extension and extend the program’s trust fund’s lifetime by five years to 2040.
Jane Whilden lives in a home that heavily overshadows Social Security. The southern New Jersey resident retired early from a local government job as the main caretaker for her family, including her mother and her husband, a retired trucker.
The program should top the list for presidential candidates, she said.
“Everyone is getting old and we need to know what’s going on,” Whilden said. “I haven’t heard what they are going to do. You just hear all kinds of negative things.”
The COLA is only part of the annual financial calculation for seniors. Medicare’s “Part B” premium for outpatient care is also usually announced in the fall. This amount usually increases, so at least some additional Social Security amount goes to the health care premium.
The Medicare premium for 2021 has not yet been released, but there are concerns that some emergency action the government may have taken in response to the coronovirus epidemic may be a major setback. This prompted Congress to pass a recent electoral year law that limits next year’s premium increase, but later collects the full amount later under a repayment mechanism.
“There is a lot of uncertainty regarding the effect of coronovirus on the cost of premiums next year,” said Casey Schwarz, policy expert at the Medicare Rights Center Advocacy Group. The Medicare monthly premium is now $ 144.60.