Congress is still currently under pressure to grant a one-time $1,400 stimulus payment to help seniors with their financial problems. The Senior Citizens League, a non-partisan organization that advocates for senior benefits, has said that its chairman, Rick Delaney, wrote a letter recently to congressional leaders in support of the stimulus payment. The Senior Citizens League have also personally written to Congressional leaders, requesting the one-time payment. Delaney noted in his letter that his organization had heard from thousands of seniors who had exhausted their retirement savings, were forced to eat less meals per day, and even reduced their medication dosage due to inflated medical costs. According to Delaney, “These are just a few of the drastic measures that so many have had to take this year as a result of what inflation has done to them”, also adding that many seniors believe “our government has forgotten about us”.
Mary Johnson, Social Security and Medicare policy analyst, stated that a $1,400 stimulus check, combined with a projected 6% increase in Social Security’s cost of living adjustment next year, would go a long way toward alleviating the problems. Furthermore, in an email to GoBankingRates, Johnson writes that “Even with the COLA increase, there are several reasons why a $1,400 stimulus check for Social Security recipients is still greatly needed”. She goes on to claim that large percentage of Social Security recipients are in “financially precarious” situations. “Of those who do have savings, our surveys found that 50% of those who responded said their retirement savings had not recovered to pre-pandemic levels as of December 31st, 2019, despite the large run-up in the stock market later in 2020 and the first part of 2021. Johnson did point out, however, that while a higher COLA would increase people’s Social Security income, it would also increase their taxable benefits. It may also result in a reduction in benefits from other programs, such as food stamps, rental assistance, and Medicare savings.
The Senior Citizens League’s officials are realistic about how their proposal will be received by lawmakers, who have recently been arguing over issues like the debt ceiling and President Joe Biden’s proposed $3.5 trillion infrastructure bill. In Delaney’s letter to Congress, he states that “It is unlikely that Congress will take action on our proposal this year, but if we can build enough support from seniors for it, we are hopeful that it will become a major issue next year and that Congressional support for it will grow”. Last month, the League wrote to its supporters, outlining their plans for a petition for extra cash payments for retired Americans. The increase came after forecasts previously predicted a 6.2% increase. As of October 13th, the official final cost of living adjustment for 2022 came in at 5.9% to be exact. As such, this would mean around a $95 increase for those receiving the current average of $1,543 in Social Security benefits, bringing the total to $1,638. Those receiving the maximum benefit of $3,895 may be eligible for an additional $241 dollars per month, for a total of $4,136.
According to the Treasury Department and the Annual Trustees’ Report released in September, the Old-Age and Survivors trust fund is only funded for the next 12 years. Resources for retirees are depleting every year because the fund does not collect enough taxes to cover what it pays out to claimants. According to last year’s report, the fund would be depleted by 2034. The new report, however, confirmed that funds would only be available until 2033. Despite these findings, retirees needn’t worry because Congress has plenty of time between now and then to raise payroll taxes, or do whatever it needs to, in order to replenish those trust fund reserves.