So what will you do with your extra $63?
That’s the estimated monthly increase retirees are supposed to see next year in their Social Security checks. Benefits for 50 million people will go up 5.8 percent next year, according to The Associated Press, the largest increase in more than 25 years.
The increase will begin in January and is the largest since a 7.4 percent hike was approved in 1982. Retirees got a 2.3 percent increase at the start of this year.
The typical retiree’s monthly check will go from $1,090 to $1,153. That’s still pretty meager, especially in a climate of rising prices for food, rent and other goods. Gasoline prices have dropped in recent weeks, but could jump with the fickle price of oil.
The increase is a nice bump, but the funds are likely already spoken for – in higher home heating costs or higher grocery bills. And like all of us, retirees have watched as their retirement savings have been battered and drained by the largest drops on Wall Street in 70 years.
Sens. Barack Obama and John McCain have argued over Social Security during the presidential campaign, but neither has given a clear plan to fix the government’s largest entitlement program. It is facing impossible strains with the upcoming retirement of 78 million baby boomers.
The Social Security trust fund is projected to deplete its reserves in 2041 and will pay out more than it collects in benefits starting in 2017. That’s only nine years away.
While anyone receiving benefits is pleased to see an increase, it is small and will be absorbed quickly. The growing nightmare is looming in less than 10 years. How can this system be sustained when payouts exceed collections?
It’s a bitter pill, but somehow the system must be cut. There are some people who rely on these benefits for their very survival. Others could easily do without them. Our next president must tackle this prickly, painful issue, before it sinks us even deeper into debt.
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