Americans are unhappy with the nation’s Social Security system.
A mere 6% of adults feel no changes are necessary to Social Security, according to Nationwide Retirement Institute’s latest annual Social Security survey of 1,800 adults.
By contrast, nearly 4 in 5 Americans want to see changes to one of the nation’s most cherished retirement programs. Here are the changes survey respondents say are needed.
8. Reduce benefits across the board
Respondents who said Social Security needs to change in this way: 6%
Every so often, someone suggests reducing Social Security benefits as a way to shore up the program’s finances. Such proposals are floating through Congress at this very moment. But such reductions are controversial, and it’s unclear whether benefit cuts will become a reality anytime soon.
7. Reduce benefits gradually
Respondents who said Social Security needs to change in this way: 9%
Some people are not completely opposed to cutting Social Security benefits as long as it happens gradually, with a greater impact on future generations. A more measured approach to trimming benefits might take some of the sting out of the reductions.
6. Increase the full retirement age
Respondents who said Social Security needs to change in this way: 19%
The notion of increasing the full retirement age (FRA) is nothing new. The FRA once was 66, but between the years 2017 and 2022, it was gradually increased to 67 for newly eligible beneficiaries.
Do Americans have the stomach for another such increase? Time will tell.
5. Increase funding through worker FICA taxes
Respondents who said Social Security needs to change in this way: 23%
Nobody likes to pay higher taxes. But one way to restore Social Security to full health would be to increase the FICA taxes that workers pay.
Right now, those who work for an employer split payment of a 12.4% payroll tax for Social Security with their company. They also split a 2.9% Medicare tax.
On the other hand, those who are self-employed pay a self-employment tax of 15.3%, which includes the 12.4% for Social Security and 2.9% for Medicare.
4. Reduce the age of eligibility
Respondents who said Social Security needs to change in this way: 24%
While some people want to stabilize Social Security by reducing benefits, others believe the program should be more generous, not less.
At present, 62 is generally the earliest age at which someone can claim their benefits. Some people would like to see that age lowered.
3. Lower taxes on benefits
Respondents who said Social Security needs to change in this way: 40%
One of the most irksome things about Social Security is the possibility that your benefits will be taxed. In fact, as much as 85% of your benefits can be federally taxable, depending on your income. Many Americans would like to see those taxes reduced.
In the meantime, don’t miss “5 Ways to Avoid Paying Taxes on Your Social Security Income.”
2. Increase funding through employer FICA taxes
Respondents who said Social Security needs to change in this way: 41%
Some Americans would like to like to see FICA taxes raised to shore up Social Security. At least, they feel that way as long as they don’t have to pay the taxes. Asking employers to pay more on their portion of FICA taxes is a winning idea with more than 4 out of 10 Americans.
1. Increase funding through taxes on higher earners
Respondents who said Social Security needs to change in this way: 49%
As of 2023, workers do not owe FICA taxes for Social Security on any income they earn in excess of $160,200. Nearly half of Americans feel that is unfair and would like to see more of a highly paid worker’s income subject to these taxes.
