Higher Benefit Payments
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Those who have spent their life working long hours for little pay will see the biggest benefit boost under this legislation. Benefit payments would be increased for low-income workers and those who have earned less over their lifetime careers.
New Formula to Calculate Benefits
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As the formula stands now, low-wage workers receive less benefits when they retire. The new “proportional” formula in this bill would create a fairer system for those who depend on it the most.
Eliminating the Earnings Test
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The RET has serious drawbacks. Currently, earnings testing punishes those who work hard and save the most, while not helping those who have earned less. Eliminating the test would allow recipients greater flexibility when making decisions about their financial future.
No Penalties for Working
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The amount a working retiree could earn without losing a portion of their benefits was raised this year. In addition, penalty amounts were lowered. However, under the SSRA, all penalties for working while collecting benefits would be eliminated.
Lump Sum Pay-Out Option
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Currently, those who delay receiving benefits until full retirement age receive an annual 8% delayed retirement credit. The credit is then paid out as an addition to the standard monthly benefit amount at full retirement age.
However, the new legislation would allow for retirees to take a one-time lump sum payment of their delayed credit earnings, rather than receiving it with their monthly benefit payment.
