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However, the Social Security Fairness Act may not be as effective as it sounds.
To learn more, GOBankingRates spoke with Kelly Gilbert, the owner and principal fiduciary advisor ofEFG Financial.
He helps clients navigate investing while educating themselves in areas of economics, personal finances and business finances.
Heres what he had to say about the Social Security Fairness Act andthe future of Social Security.
Is the Social Security Fairness Act the Right Approach?
And by doing so, it puts another $200 billion hole in an already failing Social Security budget.
When its reserves are depleted, it will continue to pay 79% of benefits.
Does COLA Keep Up With Inflation?
Another important discussion within Social Security reform is understanding how well the program adjusts to inflation.
The cost-of-living adjustment (COLA) represents an annual boost in Social Security payouts to keep up with inflation.
However, Gilbert expressed skepticism about how much COLA actually keeps up with inflation.
As the program exists, there is an incentive to depress COLAs rate relative to inflation.
What jot down of Reform Can Address Social Securitys Impending Insolvency?
Gilbert said the current bill moves Social Securitys solvency backward.
If they had invested like the railroad pension does, we would not be in this mess.
Investing Social Security funds into assets could make the program more sustainable.
It could also boost the stock market, as publicly traded corporations would receive additional capital.
Dividend stocks, in particular, offer yields that would help provide Social Security payouts without requiring stock sales.
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