It has been common knowledge for some time that millennials in Michigan may be paying into a Social Security fund that they may not enjoy the benefits of when they need it. In February of this year, the New York Times reported that democrats were on the case to slow the rising costs of Social Security. They did so by introducing the Social Security 2100 Act.
The bill would become the first big change to America’s Social Security programs since 1983 and the first big move to expand it since 1972. The biggest changes involved removing the need to pay Social Security taxes from 12 million taxpayers in the middle-income bracket, while raising taxes in other income brackets. The bill would now become applicable to earnings higher than $400,000 each year and the tax rate would grow from 12.4% to 14.8% over a 24-year period.
The bill did not only focus on cutting back either. The new payroll tax reform it proposed would allow the Social Security Administration to pay out a 2% benefit increase. There would also be an annual cost-of-living adjustment to address the fact that people relied more on health care services as they get older.
According to CNBC, however, the jury is still out on whether or not these changes will benefit millennials in the long run. They certainly ensure that baby boomers and Generation X retire comfortably, but what about Generation Y? One of the proposed objections is the fact that millennials would now be paying more taxes than previous generations so that those generations can draw comfortably from the fund. With most of the focus on retirement and health care benefits, it is not yet clear what effect this may have on Social Security Disability.