Changes in Social Security

Last updated on April 16, 2013

Social Security is a promise every American citizen receives from the government for basic survival after retirement. Even though all taxpayers fund Social Security through payroll taxes, the benefits they enjoy may not be equivalent to the amount of taxes they paid, due to their level of income through the years.

The Social Security wage base has risen from $110,100 in 2012 to $113,700 in 2013. More than 60 percent of taxpayers depend on the social safety net to pay expenses during retirement. Most families depend on retirement plans, personal savings and/or Social Security to support them in old age. When President Obama proposed cutting Social Security benefits, it created an uproar because of the large number of taxpayers who depend upon Social Security to finance their life after retirement, whether partially or fully.

President Obama has proposed changes to the way Social Security calculates cost of living adjustments so the program could save money. Many oppose the proposal claiming that the changes will burden the poor and the elderly who depend upon Social Security the most. President Obama has also recommended minor changes in Medicare as well.

Even though the President has been congratulated for bringing entitlement changes to the discussion table, the way forward is not yet clear with the Republican opposition. There will be continued talks about how exactly entitlement reform is brought on. There is space for negotiation and that is what both the parties are going to use to come to a decision.