Social Security (House) Proposal

[GenXguy]

At the very least a very poor choice of phrase accusing beneficiaries of "gaming the system" that's all. While that can have benign purposes, more often it carries negative connotations - cheating is a common meaning. But go ahead and give yourself the benefit of the doubt after the fact.

Right, if someone (in general) had simply read my various comments on the matter from the beginning and throughout this thread instead of focusing on a multi-meaning single word used one time, and incorrectly applying their own definition to what I was saying out of context, it should have been clear I wasn't implying any "cheating" or "wrong doing" and that it was a reform that I was stating needed done to the current system. Sometimes people just want don't want to listen and will overreact when there is no "there" there. Anyway, I'm glad we got it all cleared up. And it's not like our input on the matter in this thread amounts to anything that will be done to the program.

No one disagrees with you, but you keep saying others are wrong about things when they aren't and it makes you look [mod edit]

Seems it was more of a misunderstanding due to assumptions and taking things out of context. But I think it's all cleared up at this point. And I'm glad that no one disagrees.

 

[CardsFan]

I was going to comment, but I think I'll just

 

[pb4uski]

On the spousal benefit, even f one objected to it philosophically as GenXguy does there is no way to say to the SSA that you don't think that you deserve the benefit and don't want it... you're going to get it whether you want it or not and there is no way to turn it off. I guess that you could collect it and then mae a corresponding contribution to the United States when you file your tax return!

I wonder if the whole spousal benefit thing came about as matter of public policy with the Congress wanting to encourage more traditional families with stay-at-home moms. I'd be curious as to why it was put in place.

 

[latexman]

FWIW.

Question - what was the original intent of spousal benefits in the social security program?

Bing Copilot AI - The **original intent** of spousal benefits in the **Social Security program** was to provide financial support and security for spouses who may not have worked or earned as much as their partners. Here are the key points regarding spousal benefits:

1. **Income Protection**: Spousal benefits were designed to ensure that non-working or lower-earning spouses, especially women who often took on caregiving roles, would have access to a portion of their working spouse's Social Security benefits.

2. **Reducing Poverty**: By allowing spouses to claim benefits based on their partner's work history, the program aimed to reduce poverty among elderly couples. It recognized that a family's financial well-being should be a joint effort.

3. **Equalizing Opportunities**: Spousal benefits aimed to address gender disparities by providing a safety net for spouses who might have sacrificed their own careers to support their families. This was particularly relevant during an era when traditional gender roles were prevalent.

4. **Encouraging Marriage Stability**: The program also encouraged marriage stability by ensuring that spouses could rely on each other's Social Security benefits during retirement. It promoted family cohesion and financial security.

5. **Eligibility Criteria**: To qualify for spousal benefits, a person must be married to someone who is eligible for Social Security benefits. Generally, the non-working or lower-earning spouse can receive up to 50% of the working spouse's benefit amount.

Remember that Social Security rules and regulations have evolved over time, but the original intent of spousal benefits remains rooted in providing financial support and stability for couples during retirement .

Question - how have spousal benefits changed over time?

Bing Copilot AI - **Spousal benefits** within the **Social Security program** have undergone several changes over the years. Let's explore some key shifts:

1. **Early Implementation**:
- When Social Security was first established in the 1930s, spousal benefits were introduced to provide financial support for non-working or lower-earning spouses.
- The original intent was to ensure that spouses who had sacrificed their own careers for family responsibilities would have access to a portion of their working partner's benefits.

2. **Gender Roles and Assumptions**:
- Historically, spousal benefits were based on traditional gender roles, assuming that husbands were the primary breadwinners and wives were homemakers.
- These assumptions influenced eligibility criteria and benefit calculations.

3. **Equalization of Benefits**:
- Over time, efforts were made to equalize benefits for both spouses.
- Changes included allowing spouses to receive up to 50% of their partner's benefit amount, regardless of gender.

4. **Divorce and Remarriage**:
- Amendments allowed divorced spouses to claim spousal benefits if they met certain conditions (e.g., marriage duration).
- Remarriage rules were also adjusted to accommodate divorced individuals.

5. **Working Spouses and Dual Earners**:
- As more women entered the workforce, spousal benefits adapted to dual-earner households.
- Working spouses could claim their own benefits or opt for spousal benefits, whichever was higher.

6. **Full Retirement Age (FRA)**:
- The age at which spouses could claim full benefits changed over time.
- Initially, it was 65, but it gradually increased to 67 for those born after 1960.

7. **File and Suspend Strategy**:
- A popular strategy allowed one spouse to file for benefits and then suspend them, allowing the other spouse to claim spousal benefits.
- This strategy was phased out in 2016.

8. **Deemed Filing Rules**:
- Deemed filing rules now require individuals reaching FRA to claim both their own and spousal benefits simultaneously if eligible.

9. **Survivor Benefits**:
- Spousal benefits extend to survivor benefits when one spouse passes away.
- Surviving spouses can receive a percentage of the deceased spouse's benefit.

10. **Means Testing and Adjustments**:
- Proposals have been made to adjust spousal benefits based on income levels or means testing.
- These changes aim to address program sustainability.

Remember that Social Security policies continue to evolve, reflecting societal shifts, economic considerations, and demographic changes .

 

[jollystomper]

As you can see from your own definition, "gaming" can mean different things. I think I have clarified sufficiently multiple times what I mean by "gaming." It's no different than how people talk about gaming the ACA by getting their MAGI income lower. It's not that they are doing something wrong/illegal to take advantage of the system. Strange I have to keep explaining that. lol

I think the difference between the ACA and the spousal benefit, though, is that people actively seek ways to lower the MAGI income to qualify for it, and that is the primary reason they lower their income.

I do not know of any married couple who make the decision on whether or not a spouse should work based on SS spousal benefits. They make that decision based on many other factors. Do you know of any couples who deliberately had one spouse stop working or not work purely because of the SS benefits?

It would be like saying people who choose to get married "game the system" because they want lower tax rates.

 

[dmpi]

My 2C worth.
On spousal benefits, they should leave it as is. This is in place to protect wives who were homemakers and then their Husbands divorced them, leaving them with nothing and no SS. When people talk about they should only get half, they should consider that leaves these people living in poverty. If SS is barely enough to live on now (for most people), then how is "half" going to be anywhere close?

70% of the divorces are initiated by the wife and only 25% of wives are stay at home moms. I would think this would be a quite rare case. IMHO overly generous benefits for the wife probably encourages more divorces.

 

[AudiDudi]

LatexMan. If born before 1954, one spouse could claim benefits and the 2nd spouse could file a restricted application at FRA and collect just spousal while their benefit increased 8%/yr to age 70. My spouse claimed at age 62, at my FRA of 66, I filed a restricted application and for 4 years, collected (husband benefit - SS term) while my benefit increased and I filed for my benefit at age 70. Figuring the annual increases + the 32% over the 4 years gave me an increased benefit of about 48%(it was a "free" $50k+ with a break even at age 77). I just played by the rules.

 

[GenXguy]

I think the difference between the ACA and the spousal benefit, though, is that people actively seek ways to lower the MAGI income to qualify for it, and that is the primary reason they lower their income.

In my view, it doesn't even matter. As long as they are operating within the law without deception, I don't think either is wrong.

 

[lucky penny]

GenX - I understand you don't like the way the rules are. Lots of people don't.

You can't have it both ways (post 161). People cannot, by definition, be "adhering to the current system as it is to take advantage of it and game it to their advantage."
They do not game it to their advantage, they merely use it to their advantage.

Spouses are not "gaming the system". They are following the system.

Hope this helps.

From Wikipedia, the free encyclopedia

For the Wikipedia guideline, see Wikipedia:Gaming the system.
Gaming the system (also rigging, abusing, cheating, milking, playing, working, breaking the system, gaming, or bending the rules) can be defined as using the rules and procedures meant to protect a system to, instead, manipulate the system for a desired outcome.[1]

+1

 

[Jeffman52]

70% of the divorces are initiated by the wife and only 25% of wives are stay at home moms. I would think this would be a quite rare case. IMHO overly generous benefits for the wife probably encourages more divorces.

That is today. Spousal benefits were added to SS in 1939. At the time only 25% of women were in the workforce. Divorce was uncommon. By 1945 only 34% of women were in the workforce. Currently its around 75% and divorce is more common.



Just my own opinion, is that no one gets divorced thinking... "hey I will live large off my previous husbands SS numbers". And I don't think women (or men) should be locked into a horrible marriage because they cant get spousal benefits if a divorce happens. I also don't think its overly generous. A single person living on SS is not killing it. Living on half of SS would be poverty. Living without it at all would be destitute.


Neither here nor there because I don't see this going away and I don't think changing spousal benefits will make enough difference to keep SS solvent. Any changes would have to be larger and most certainly require a raise in the cap or a decrease in benefits.

 

[ShokWaveRider]

Here is a "Tube" on the subject from one of my favorite Tubers.

 

[audreyh1]

On the spousal benefit, even f one objected to it philosophically as GenXguy does there is no way to say to the SSA that you don't think that you deserve the benefit and don't want it... you're going to get it whether you want it or not and there is no way to turn it off. I guess that you could collect it and then mae a corresponding contribution to the United States when you file your tax return!

I wonder if the whole spousal benefit thing came about as matter of public policy with the Congress wanting to encourage more traditional families with stay-at-home moms. I'd be curious as to why it was put in place.

Way back in 1935 when SS started most families were SAHM. Really until the 70s a woman was expected to quit her job when she married. She had a new job - taking care of hubby and the household. In the 70s was when 2 earner households became much more common driven by economic pressures as well as social.

 

[MichaelB]

Way back when SS started most families were SAHM. Really until the 70s a woman was expected to quit her job when she married. She had a new job - taking care of hubby and the household. In the 70s was when 2 earner household became much more common driven by economic pressures as well as social.

Exactly. And women outlive men, so widowed senior citizen with no source of income and living in abject poverty was not uncommon. The spousal benefit was a humanitarian act.

It is, however, also not a significant contributor to the SS trust deficit. This is clear from the previous links. The 2 drivers shortfall are the wage indexing to calculate the PIA and the COLA after benefits begin.

 

[Chuckanut]

Lots of people take advantage and ‘game’ the system. I received benefits from my ex-wife’s SS account under the former rules while I waited to 70. So what? My neighbors got the rest of us- including me - to subsidize their fancy new EVs. The company that made my heat pump raised prices by over $1400 this year to capture some of the tax subsidy that homeowners get for installing a new heat pump that replaces old fashioned baseboard heating. Now, that’s gaming the decision. Or is it?

IMO, paying a SAH mom part or all of her former or deceased husband’s SS is the least objectionable of all. Just my 2¢.

 

[Running_Man]

Most of these guys take zero salary or $1. They have other ways to pay for their next meal.

They borrow against stock and can go a lifetime without paying any taxes. Secondarily they put a $5,000 ownership contribution in a new company in a Roth, then when they announce they will run the company for free the stock soars and they get millions tax free in a ROTH. See Peter Thiel who is one of thousands in Silicon Valley utilizing this strategy. Most of the companies pay precious little in taxes as well.

 

[Wile E. Coyote]

70% of the divorces are initiated by the wife and only 25% of wives are stay at home moms. I would think this would be a quite rare case. IMHO overly generous benefits for the wife probably encourages more divorces.

No, the paperwork is initiated by the wife. The actual separation is initiated primarily by the male (by his actions, words or decisions). The old adage women have to do everything.

 

[Retired Expat]

And they should have a choice: Breakfast / Lunch / Dinner..

There are many more seniors that live solely on SS than many people realize.

We could fix SS by reducing general income tax by 1% and allocate that 1% to SS in addition to existing SS taxes. There is no tax increase over all, SS gets a boost, and fewer Pork Projects by Congress have funding.

That would almost require congress to want to help everyone. But there is a distinct bias on the part of some members to not tax the wealthy. Instead of limiting it to 250k there should be no limit although I do think some sliding scale shoud be imposed

That executives collect 100 million dollar payouts and don’t contribute to SS makes no sense

 

[badatmath]

So, can either of you quantify the financial impact of non-working women getting spousal benefits?

According to BLS statistics around 65% of men 16-65 are in the labor force, and 56% of women are, so this may be a factor but it doesn’t look significant.

May not be significant but seems illogical to me. IDK. I guess I wasted my time working when I could have just married and spent all day painting my nails like my neighbor. . . (I don't dislike her but I find her lifestyle quite odd as she sort of does . . . nothing. Doesn't work or volunteer or have children or and she thinks it was odd that I worked 30+ years so I think we are even. According to her working was a waste for me).

I don't understand incentivizing people NOT to work. I worked because I HAD to.

 

[Flieger]

A Law School Grad with a good GPA could pull down $150K first year. Experience in Patent Law and Intellectual Property could bring in more.

Shall we talk about Medical Degrees ? How about Computer Science ??

Like I said. Very small subset.

Flieger

 

[Alan]

Thanks for the interesting discussion. We are sure there will be many more opportunities to discuss this subject again, particularly if any similar bills make it out of committee.