Fix Social Security - Eliminate Spousal Benefit

[phil1ben]

When SS was first enacted few women worked. I understand why the spousal benefit was enacted in 1939 for women and 1950 for men. However, if we want to make the system self-sufficient I think it is time to eliminate the benefit for both men and women in the event only one spouse paid into the system. A survivorship benefit should remain. For example, if a husband was a stay at home father and his wife paid into the system and should pre-decease the husband, then he should receive a benefit for the remainder of his life based on what was paid into the system by his wife.

What I am questioning is the ability of a husband and wife to BOTH COLLECT SS at the same time while they are alive if only one paid into the system. If both spouses paid into the system then both should be able to collect based on their independent contributions.

Subject to the survivorship benefit described above, would the system be self-sustaining if we eliminated the ability of a non-paying spouse to collect 50% of the paying spouse's benefit while both spouses were alive? Obviously, I am only proposing the change prospectively from adoption because many have already based their retirement and relied on current rules. Perhaps make the change only apply to people turning 16 in 2025.

 

[Sunset]

I'm sure there are lots of suggestions available.

How about:
Remove the limit on taxation for SS.
We don't have any limit on regular tax and in fact the more you earn the higher regular taxes go.

Since the system is not a savings plan where your contribution is saved for yourself, it's really a tax system where people are taxed to pay for the expenses.

The simple fact is, either the system needs to increase the incoming $$ or decrease the outgoing $$ and will hit the tipping point in around 8->10 yrs.

 

[SnowballCamper]

I doubt any marginal changes will have much effect. As a system that pays the demographic with the most active electorate, I don't see how the structural change that is needed will happen. I think the primary structural change needed is an increase in the retirement age, ideally indexed to something like the IRS mortality tables that get updated on a regular basis based on how long people actually live.

I think the more likely scenario is that when payments are reduced due to insolvency, Congress will increase taxes on current workers in response to beneficiaries complaints.

 

[Calico]

 

[Markola]

“Insolvency” is a an unnecessarily scary word. SS actuaries’ very worst case scenarios are that benefits would need to be cut by 27% or so in the early 2030s should Congress do nothing at all. However, SS is the most popular social program we have, so Congress will eventually act, one way or another.

 

[SnowballCamper]

I agree they will act eventually. I'm not sure what is scary about insolvency. It seems to describe the situation pretty accurately: unable to satisfy creditors or discharge liabilities, either because liabilities exceed assets or because of inability to pay debts as they mature.

https://www.dictionary.com/browse/insolvent?s=t

 

[pb4uski]

I'm guessing that eliminating the 50% spousal benefit has negligible impact since so many couple today were both workers.

 

[phil1ben]

Thank you all for your responses.

However, I would like to keep this thread focused on the elimination of the spousal benefit. There have been many other general threads concerning the need to fix SS but I would if possible like to keep this one focused on the question that I raised. I would prefer that my question does not devolve into a general we need to fix SS thread.

 

[ivinsfan]

Thank you all for your responses.

However, I would like to keep this thread focused on the elimination of the spousal benefit. There have been many other general threads concerning the need to fix SS but I would if possible like to keep this one focused on the question that I raised. I would prefer that my question does not devolve into a general we need to fix SS thread.

It's the timing of your idea that's the problem, apply to people turning 16 in 2025 and it won't impace anything for almost 50 years. What will that accomplish?

 

[Hacksaw]

ivinsfan and pb4uski both point out the flaws in the idea of eliminating the spousal benefit without eliminating those "grandfathered in." It's a non-starter.

Hacksaw

 

[Car-Guy]

Thank you all for your responses.

However, I would like to keep this thread focused on the elimination of the spousal benefit. There have been many other general threads concerning the need to fix SS but I would if possible like to keep this one focused on the question that I raised. I would prefer that my question does not devolve into a general we need to fix SS thread.

ok, I'm 100% against it.... I was "forced" to pay in all my working life and I paid the max amounts for 20+ years. They made the rules, they forced me to pay and now I want what was promised and is owed. (including spouse benefits)

In my case, my spouse worked and paid into the system too but the spousal benefits turned out to be higher for her so she took it... Again, they made the rules and took our money. Now they need to honor their obligations.

I could go on and on about the "extra" trillions and trillions they seem to have found just in the past year for just about everything else, but I won't.

 

[homestead]

SAHM's often have lots of kids which will eventually be paying into my SS.
I'm ok with giving them spousal benefit.

 

[pb4uski]

..... However, if we want to make the system self-sufficient I think it is time to eliminate the benefit for both men and women in the event only one spouse paid into the system. A survivorship benefit should remain. For example, if a husband was a stay at home father and his wife paid into the system and should pre-decease the husband, then he should receive a benefit for the remainder of his life based on what was paid into the system by his wife.

What I am questioning is the ability of a husband and wife to BOTH COLLECT SS at the same time while they are alive if only one paid into the system. If both spouses paid into the system then both should be able to collect based on their independent contributions. ...

I'd again suggest that the savings of such a change as you suggest are quite minimal.... small fish in the whole scheme of things... especially if implemented prospectively since there are very few marrieds where one spouse hace never worked and paid into the system.

https://www.ssa.gov/policy/docs/ssb/v72n1/v72n1p1.html

 

[pb4uski]

...now I want what was promised and is owed. (including spouse benefits) ..

Legally, nothing is owed. A popular misconception.

You worked hard your whole life and paid thousands of dollars in Social Security taxes. Now it’s time to retire. You’re legally entitled to Social Security benefits, right? Wrong. There is no legal right to Social Security, and that is one of the considerations that may decide the coming debate over Social Security reform.

 

[RetireBy90]

ok, I'm 100% against it.... I was "forced" to pay in all my working life and I paid the max amounts for 20+ years. They made the rules, they forced me to pay and now I want what was promised and owed. (including spouse benefits)


I could go on and on about the trillions and trillions they seem to be able to find in the past year for just about everything else, but I won't.

I’m 100% in agreement this is mine, bought and paid for. It isn’t like many entitlements that are money from the govt, I look it as my money like a savings account. However, if nothing is done then my savings account will be reduced. I see the spousal benefit like many of the additional benefits that are part of the SS program that were never paid for in our FICA deductions. If you want all the expanded benefits you gotta pay for them.
If you go back to when SS was first established reports are that mortality had average worker die at less than 65, so SS was in case you lived longer. A small percentage were expected to draw the benefit.
I think the repair to funding could be “fixed” by simple moves that would not require complete elimination of SSDI or spousal benefits. Perhaps a change could be spousal benefits only if a spouse isn’t eligible for SS otherwise ?
For any changes a question you would have to answer is what age would be grandfathered? Don’t want to take it away from those already drawing. If I was say 65 and plan to retire in one year and counting on the spousal benefit, that would be especially difficult to swallow.l

 

[Dtail]

Having multiple spouses collecting on one payer is not that great either.
Shoring up the system with higher taxes might be a better route.

 

[Car-Guy]

Legally, nothing is owed. A popular misconception.

I have no idea if it's technically a misconception or not but I'll call that BS - I know what's been implied. What is right is right!

 

[RetireBy90]

Having multiple spouses collecting on one payer is not that great either.
Shoring up the system with higher taxes might be a better route.

What ever solution is called for, it has to pass the special interests that grease the wheels of congress. It is a nasty business but trying to craft. Proposal that could get 51% of members or participants on this forum would be tough. I would suggest something that includes small increase in the tax rate for employees and companies along with future FRA being extended would hit a small impact on most everyone except those already eligible.

 

[Car-Guy]

I wonder how much of SS problems today are due to mismanagement and fraud.

 

[pb4uski]

^^^ Probably negligible from everything that I'm aware of... what mismanagement and fraud do you have in mind? The problems are more due to Congress having no balls to adjust the program for many years while the SS actuaries were continually reporting that due to demographics that there would be problems.

 

[Car-Guy]

^^^ Probably negligible... what mismanagement and fraud do you have in mind?

Years ago there were lots of stories about redirecting SS funds (mismanagement) for other things and there were tons of people that were getting payments for dead relatives, etc... Not sure how much of that was true and/or has been corrected.

The problems are more due to Congress having no balls to adjust the program for many years while the SS actuaries were continually reporting that due to demographics that there would be problems.

Playing kick the can... Probably true...

 

[NYEXPAT]

They can keep the spousal benefit, for all I care. Just don't touch my Kids benefits!

 

[pb4uski]

On the first part SS is ring-fenced so I don't see that as likely. One the second part my own personal experience is that when someone dies the funeral home reports the death to SS so that seems unlikely on a significant scale although I'm sure that there is some.

 

[RetireBy90]

I wonder how much of SS problems today are due to mismanagement and fraud.

One problem of mismanagement or outright fraud is the judges that approve Disability at rates that approach 100% or in one case a grudge in WV had approved 100% of claims that were originally denied.

 

[SecondCor521]

It's too popular among the voters so it will be fixed.

I think it's likely that Congress will wait until the calamity is nearer before acting.

There are plenty of fixes that can be made, but I think it's impossible to figure out now which ones will be employed when the time comes.

Whatever choices are made, based on past history I expect that as part of the "fix" two things will be included: (a) higher FICA taxes, and (b) an expansion of the program's benefits in some way. The latter probably does not help with program solvency but seems to be a "spoonful of sugar helps the medicine go down" kind of feature.