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The silver bullet to save Social Security hasn’t yet been found, but some MarketWatch readers think privatizing the program could be a start.
The combination of trust funds that support Social Security retirement and disability benefits is expected to run out of money by 2034, according to the latest trustees report, released earlier this year. At that point, beneficiaries would see a 20% cut to their paychecks.
Ahead of the second GOP debate Wednesday night, MarketWatch conducted polls on Instagram and X, formerly known as Twitter, to take readers’ pulse on how they think Social Security could be fixed.
Of the approximately 650 people who participated in the Instagram poll asking how Social Security could be fixed, 34% said by changing benefits, while another 32% said by privatizing it. Some 21% said the system could be fixed by increasing taxes, and 14% suggested raising the retirement age.
In another question, MarketWatch asked when people expected to retire. Of the nearly 950 responses, more than four in 10 people said they expected to retire in 35 years; another 34% said in 20 years; 7% said next year; and 17% said never. When asked if they thought Social Security benefits would be available when they retire, 29% of the roughly 900 respondents said yes, while 71% said no. The number of responses varied by question because polls are placed on individual pages in Instagram stories.
See: Should Social Security be invested in equities?
In a MarketWatch poll conducted Tuesday on X, readers echoed the idea of privatizing Social Security. A third of the 483 people who voted said the program could be fixed by privatizing, followed by 27% who said by increasing taxes, 22% said by raising the age and almost 18% who said by changing benefits.
Questions and answers for social-media polls on Instagram and X are limited in characters, making all four options a bit broad.
MarketWatch
Still, privatizing Social Security could happen in a few ways: It could simply mean taking Social Security out of the government’s control, but it could also mean the government investing some of the assets for the program in the stock market. Some proponents — or opponents — might liken privatization to beneficiaries personally investing their Social Security money. The idea has been weighed for decades, and was highly contested when former President George W. Bush suggested it in 2005 because critics said it could put those assets in danger.
Also see: Should the U.S. privatize Social Security?
Right now, Social Security is invested in U.S. Treasury bonds, but that’s uncommon among other kinds of pension systems, MarketWatch columnist Brett Arends argues. “For a longer-term investor, they’d urge you to keep much or most of your money in stocks. For a very simple reason: Stocks, while more volatile, have been much, much better investments over pretty much any period of about 10 years or more,” he writes. In comparison, Treasury bonds are considered safe but don’t yield the same returns in the long term, he noted.
But keeping assets in these investments is a form of protection, and “Americans can count on their Social Security benefits during times of prosperity and times of economic turmoil,” wrote Max Richtman, the president and chief executive officer of the nonprofit National Committee to Preserve Social Security and Medicare.
Other proposals include raising the full retirement age when people would get 100% of the benefits they’re owed — right now, it’s age 67 for people born in 1960 or later — or raising taxes to help fund the system. Legislators could also look at changing benefits, such as who would be considered a survivor or disabled beneficiary, or how payment amounts are formulated.
Although proposals are floating around Congress, such as the Social Security 2100 Act from Rep. John Larson, a Connecticut Democrat, legislators have yet to decide what to do with the program. Social Security is a hot topic, but also one politicians tend to avoid as a “third rail,” considering how vital it is to so many Americans and their retirement security.
Readers, how do you think Social Security could be fixed?
