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3 possible solutions for social security

From Birch Gold Group

Donald Trump was an ardent defender of Social Security on the campaign trail, but his cabinet pick for the Office of Management and Budget (OMB), Rep. Mick Mulvaney, wants to take radical steps to fix the program. If Mulvaney is approved by the Senate, there are three big ways he could go after Social Security.

If you are planning on eventually collecting benefits from the program, you should take note.

Your Benefits Are On the Chopping Block

As it stands today, Social Security is at risk of facing a major shortfall as soon as 2034. Depending on how those in power react in the coming years, insolvency of the fund could be just around the corner.

This means that for some Americans, receiving Social Security benefits in the future is far from a sure thing. Even today’s middle-age workers might find themselves left out in the cold when retirement age comes.

However, even if policymakers like Mick Mulvaney, Trump’s pick to run the OMB, step in and intervene, the situation still looks grim. Here are three things Mulvaney might do to “fix” Social Security that would burden taxpayers and beneficiaries, while still leaving the viability of the program up in the air.

Option #1: Cut Social Security benefits.

The first and most obvious way to prop up Social Security is to cut what it pays out to beneficiaries. Trump has said that such cuts are off the table, but Mulvaney’s statements in his Senate confirmation hearings stand in stark contrast.

According to the Wall Street Journal:

Rep. Mick Mulvaney, President Donald Trump’s pick to run the Office of Management and Budget, said on Tuesday during his confirmation hearing before the Senate Budget Committee that he would advocate for reducing spending on Social Security—that is cut Social Security benefits.

“I have to imagine that the president knew what he was getting when he asked me to fill this role,” Mulvaney told the Committee.

Mulvaney is being careful not to say anything to confirm or deny his intentions to make direct cuts to Social Security, but it isn’t hard to read between the lines here. Back in 2009, he called Social Security a ‘ponzi scheme’ and insisted the program as we know it should be brought to an end. Chances are slim his views are drastically different today.

Whether you agree with the way Social Security operates or not, big cuts to the program would be a painful blow to millions of Americans nearing or living in retirement.

Option #2: Increase Social Security taxes by raising the cap on payroll taxes.

In 2016, every American paid 12.4% of their income under $118,500 to Social Security, with most splitting that responsibility 50/50 with their employer. Depending on wage inflation and the overall health of the program, that cap can be adjusted by the Social Security Administration (SSA) and people like Mulvaney.

The SSA already announced the cap would increase by 7% (to $127,200) in 2017, meaning a large chunk of high-income workers will suddenly start paying an extra $539 in taxes every year.

But Mulvaney is ready and willing to push the cap even higher. During his confirmation hearings, he made a point to emphasize that his pledge as a congressman to oppose tax increases would not extend to his service in the OMB.

Option #3: Raise retirement age so benefits are paid out later and for fewer years.

Today, the age at which Americans can receive full benefits for Social Security is set to gradually increase to 67 for anyone born after 1960. But further increases aren’t out of the question.

So even if Social Security stays solvent, the length of time Americans can draw off the program during retirement could shrink significantly.

MarketWatch reports:

President Donald Trump’s pick to head the White House budget office said Tuesday that increasing the retirement age for Social Security should be considered, as Democrats pummeled him over protecting that program and Medicare.

Mick Mulvaney, a Republican congressman from South Carolina, made the statement during an exchange with Sen. Lindsey Graham.

“Do you think we need to look at adjusting the age yet again because we live longer?” asked Graham, also a South Carolina Republican.

“I do, yes sir,” Mulvaney replied.

If Not Social Security, What Can You Count On?

Regardless of what happens over the next decade, the long-term prognosis for Social Security doesn’t inspire confidence, and counting on the program for a comfortable retirement is a gamble, to say the least.

No matter how close or far away from retirement you are, it’s time to start looking for a Plan B.

But that’s easier said than done. With uncertainty ruling the global economy, betting on assets that traditionally go in a retirement account (such as stocks and mutual funds) may end up giving you even less of a guarantee than Social Security.

So where does that leave you?

One sensible option is to safeguard your retirement with tangible, reliable stores of value that have stood the test of time, such as physical gold and silver.

Throughout history, physical precious metals have proven to be one dependable way to protect personal wealth over the long haul. Could today’s retirement crisis prove them as such once again?

  • tom nogaro

    social security is a social contract between workers (and their families) and their government. but this government did not keep guarded the revenues received by such, in order to honor that contract.

    every congress person and executive signing legislation to squander those revenues must be held personally civilly liable, along with their estates and pensions, as well as criminally liable, for imprision of duty by such fiduciary embezzlement of entrusted public funds, notwithstanding any “law” to the contrary.

    why? if such fiduciary contract is left breachable with impunity, then imperiled is all law. fiduciary public fraud tears asunder the social contract, notwithstanding pretended exemption from liability for one’s own intentional wrongdoing. any such self-exempted embezzlement would properly be held illegally void ab initio, or else abhorently voidable, as a matter of pubic policy. and sovereign immunity is no defense to intentional acts of wanton public wrongdoing.

    such entitlement benefits are property entrusted, as derived from contractual labor, not a gratuity, see, goldberg v kelly, etal.

  • Richard

    One way to help save our Social Security is for the government to pay back the money that was “stolen” from it. I don’t remember there ever being a vote on if they could TAKE it or not. Then keep them from giving it to people that have not put a dime in it.

  • Cher Krause

    There are people who made a lot of money during their lives and retire with many assets in the bank and otherwise. Yet these people get the largest social security checks. They don’t need the money.
    But they will argue, of course, they’re entitlement to it. Right?
    My thought then to a possible solution to this rich get richer and the poor get poorer would be either to make amount earned equal to hours worked rather than amount earned! Or equal money across the board. I would recommend the first, hours worked, idea. Thanks for listening to MHO.

  • vividad

    Few seniors can afford to buy gold or silver. Besides gold and silver do not provide interest for a monthly income. This is just an effort to devastate seniors as finding a safe investment is nearly impossible no matter where their hard earned money is invested.

    Hands off my social security, it is like insurance, the more people putting money monthly into the fund the more money there is available to provide income for the older retired seniors. Solve the problem by providing more jobs for more people. The USA birthrate is down, the youth cannot find good paying jobs. Let more immigrants into the country, their Social Security tax will will go into the fund. The USA government should repay with interest the money they have taken from the Social Security to fund wars and bailing out banksters who have not repaid the bailout. Greed may destroy America, not Social Security.

    Trump and most of his appointees are rich people who want to add to their wealth by destroying social programs, they think of the 99% as peasants or animals and fair game to destroy, foreclose and outsmart. And most of them proclaim they are Christians, but they are really heartless hypocrites and criminals. Is Birch Gold Group guilty of ripping off people?

  • gnafuasusual

    If U.S. Government thought the women’s demonstration was huge, they have not seen anything until they try to touch SS. !!!!!!!!!!!! If Congress expects People receiving SS to pay for their thievery, they had better be prepared for much more than they ever thought would happen. Days of following like sheep are over!!!!!

  • Doug Shivananda Friedman

    Yes, the federal government has mismanaged Social Security funds. However an important aspect of the Social Security setup was not addressed: it has been quite regressive — the richest people not only receive higher benefits, even though they tend to have more resources to live on aside from their Social Security checks, but they also have paid in a lower percentage of their earnings: for 2016, if a person made up to $118,500, they and their employer paid 12.4% of their income into Social Security. Yet if they earned $1,000,000 they only paid under 1.47% of their income into Social Security. Those who earned $5,000,000 only paid 0.29% of their income, etc. I submit that while Social Security has insurance aspects, it also has survival income responsibilities for those who cannot work, due to age or disability. Therefore I think it would be fair to not just raise the income limit on what is subject to Social Security tax, but to eliminate it altogether, so that everyone pays 12.4%. If this were done, the person earning $5,000,000 would no longer get away with the over $605,000 of Social Security taxes that they now avoid, and it would eliminate concerns of insolvency for many more decades (if not forever).
    I’ve worked for over 30 years, before health issues caused me to become disabled. I only receive Social Security Disability Insurance (I’ve decided not to receive Supplemental Security, as I just want to receive what I’ve paid into when I could work) in the last 3 years my income from Social Security has increased a whopping 0.23%. Has your cost of living only increased 0.23% since 2014? I’m fortunate that I was able to save some of my income when I worked for the time when I couldn’t work, and I’ve invested some of it in precious metals, as well as retirement accounts. I have been able to volunteer the past decade, distributing food for homeless people.
    Many people have been unable to save when they were working. Do we, as a nation, want them to be able to live frugally with dignity? Or do we not care if they have to do without necessities? What kind of people are we?

  • Ronald Ploeger

    makes sense to me ??how to afford after typical expenses??

  • Michael Raulerson

    Social Security has always been a “ponzi scheme”. No one I know thinks any different. It has always been about to run out of money for my whole life. The newspaper stories I have read during my life have never “inspire(d) confidence” in the program. When it was started the number of workers supporting the program was more than a 20:1 ratio against the beneficiaries. Today it is more like 3:1 and it is just going to get worse in the next 20 – 40 years. Unsustainable. SSI was never supposed to allow a “comfortable retirement” either. It was designed to only be a supplemental income for retired persons, but that isn’t the way many people have used it. The addition of other populations other than retirees has also stressed the program. I, personally have NEVER thought that SSI would be my retirement income source. People should have been smart enough to set up a retirement account for the past 40 years or more.
    I don’t think cutting benefits is a good idea, but increasing the age for “full” benefits should be increased much more drastically than what has been going on in the last decade or so, and I agree with Doug below that the cap for income should be removed. I have never made enough money to NOT have to pay SSI.

  • flashy0ne

    While there is little doubt that Social Security was ‘doomed’ with the advent of the ‘Great Society’ when the SS fund was ‘merged’ with the general fund and then used to fund programs such as Medicare, there still remains an array of entitlement programs funded with SS ‘money’ which have NEVER contributed to the pool. While some of these programs are no doubt ‘worthy’ of support, they should be financed by separate appropriations While hindsight is always 20/20, IF the SS funds had been invested in conservative stocks and bonds, there would be no shortage today — and probably a very different form of government sponsored health insurance !!

  • Sandra

    What do you know about Birch Gold? They have been talking to me.