| | | Biden wants to increase benefits for retirees who, on account of their low lifetime wages, had trouble saving for retirement. For the very poorest retirees, benefits from Social Security and SSIwould increase by as much as $6,500 a year. The Social Security Administration estimates that a transition to the Biden benefit structure (shown in the graph below) would pull over half a million seniors out of poverty in 2030.
Along with helping formerly low-wage workers, Biden’s plan aids two other vulnerable groups: the eldest of the elderly, and the widowed.
Retiree poverty rates rise in lockstep with age: as seniors draw down on their retirement accounts, their incomes tend to fall. Because no one knows how long they will live, retirees who outlive their savings rely predominantly on their Social Security benefits. Increasing aid to the oldest retirees — say, those 85 or above — is an obvious solution to this problem.
There’s just one holdup: Socioeconomic gaps in life expectancy are growing, so a special “elder benefit” would mostly help the rich.
Here too, Biden has a solution. His plan would increase benefits for all seniors who had received Social Security checks for at least 20 years. Since the poor start claiming benefits at younger ages than the rich, this minor tweak would open the elder benefit to people in real need.
Finally, Biden’s plan would increase benefits for widows and widowers. Under current law, when a husband or wife dies, the surviving spouse is left with the higher of two amounts: either their own Social Security check, or half of their dead partner’s check. |
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