The biggest one I see is the deep cuts to SS that will happen if Congress doesn't do something to prevent it.
I'm glad you mention this. The media talks about the same, old, tired, talking points that are then discussed to death across the Internet. Many of us probably have them memorized by now. What you seldom read about are the proposals on changing how spousal and survivor benefits are calculated. Here is a link to the document dated December 2015:
Congressional Budget Office Social Security Policy Options, 2015
This report is pretty comprehensive and also discusses many of the proposals more commonly reported on. The relevant portions are as follows:
Page 19 under the heading
Benefits for Spouses and Survivors of Retired Workers. describes how benefits are currently calculated, which many here are already familiar with, so I won't quote the 2 lengthy paragraphs. You can go to the relevant portion for a refresher.
Here are the proposals being considered:
On page 69 under the heading
Option 36: Reduce the Spousal Benefit it says (bolding mine)
Beginning in 2023, this option would reduce payments to new beneficiaries who were entitled to receive spousal benefits. Under this option, after a 10-year phase-in period, an eligible spouse of a retired worker (the primary beneficiary) would be entitled to a spousal benefit of 33 percent of that primary beneficiary’s primary insurance amount (instead of 50 percent, as under current law), so long as that surviving spouse was not eligible for a higher benefit on the basis of his or her own earnings. If the spouse also had earned benefits and his or her PIA was less than 33 percent of the primary beneficiary’s PIA, the spouse’s benefit would be increased to equal 33 percent of the primary beneficiary’s PIA. Workers who had PIAs on the basis of their own earnings that were greater than or equal to 33 percent of a spouse’s PIA would receive no additional benefit. Anyone older than 62 or currently receiving spousal benefits in 2023 would not be affected by this option.
This option would reduce benefits by one-third for people who received spousal benefits and were either not eligible for benefits based on their own earnings or whose PIAs, based on their own earnings, were less than 33 percent of their spouses’ PIAs. The reduction would be less than one-third for people whose PIAs, based on their own earnings, were between 33 percent and 50 percent of their spouses’ PIAs.
Page 67 starts the proposals for changes to survivor's benefits as follows (bolding in the paragraphs mine)
Option 34: Create an Alternative Benefit for Spouses of Deceased Workers
Beginning in 2016, this option would introduce an alternative benefit for deceased workers’ spouses; current recipients would be eligible only if the new benefit increased their payments. Under this option, the alternative benefit would be calculated as 75 percent of the sum of the surviving spouse’s own worker benefit and the benefit the deceased spouse would have received if still alive.85 The amount would be capped at the primary insurance amount for an average-wage worker.86 The survivor would receive the greater of two possible benefit amounts: the new alternative benefit or the current-law survivors’ benefit.
86. This average-wage worker is a hypothetical person who earns the average wage starting at age 20 and continues to do so through the year in which the deceased worker became eligible for retired worker benefits.
Option 35: Limit the Survivors’ Benefit
Beginning in 2023, this option would limit the survivors’ benefit to 100 percent of the primary insurance amount for an average-wage worker.87 The option would apply only to newly eligible beneficiaries. People who were older than 62 in 2023 and those receiving survivors’ benefits before that year would not have their benefits limited by this option.
These proposals uncouple the spousal benefit and survivor benefit from the actual wages of the higher earning spouse when those wages are more than those of the average worker.
A quick Google search indicates that the wages of the average worker in 2018 was about $46,800. What that would mean for anyone whose higher-earning spouse makes more than the average wage worker at the applicable point in time, is that the potential spousal benefit and survivor benefit gets a significant haircut if these proposals were to become law.
We're not planning on being highly dependent on Social Security, but many others are. IMO, the bigger implication behind this is that such a thing may only START with spousal/survivor benefits. If they did something like this, it's a small leap for the next step to be to limit the higher earner's benefit to that of the average wage worker. This would adversely affect higher earning single people as well.
Why does one think they are called back-door? It is because you are working around the rules that were intended to prevent high income taxpayers from contributing to a Roth IRA. Of course it would be on the chopping block!
