Social Security Recipients Prepare to Receive Smallest Increase in History
Roughly 55% of Genworth Financial survey respondents stated that their greatest fear regarding old age is being a burden on their family. Seniors are roughly five times more concerned about burdening their families than they are over dying. That may come as a shock but it looks like there will be another issue lingering on the minds of seniors over the next few years: Social Security or lack thereof.
Fortune reports that millions of Social Security recipients will get a 0.3% increase in monthly benefits next year, making it the fifth consecutive year that senior citizens will have to settle for historically low raises.
“I just lose and lose and lose and lose,” said Millicent Graves, a retired veterinary technician, referring to her $929 monthly amount she pays for Social Security.
“This loss of anticipated retirement income compounds every year, causing people to spend through retirement savings far more quickly than planned,” said Mary Johnson of the Senior Citizens League. “Over the course of a 25- or 30-year retirement, it reduces anticipated Social Security income by tens of thousands of dollars.”
According to Fox Business, although the 2017 0.3% increase is the smallest increase on record, it’s actually better than 2016 because there was no increase.
Medicare Part B premiums have been significantly increasing as overall healthcare expenses rise. In 1970, the monthly Part B premium was a respectable $5.30. In 2016, however, the standard monthly premium is an abysmal $121.80. What was once $8 per month for Part B beneficiaries now exceeds $450 a month.
“For the three-quarters of people who are under hold-harmless, there is going to be very little increase possible in their Part B premiums so that often spells bad news for the folks who are not under hold-hamlets because whatever sort of cost increase in the system has to be made up from that smaller group,” said Max Gulker, senior researcher at the American Institute for Economic Research.
Although Congress gave a $7.5 billion loan to the Medicare program, they won’t be able to do this too far into the future and a better, more congruent solution will be needed.