Posted by: Teaway Zehyoue Collins
Social Security remains one of the nation’s most successful, effective, and popular federal programs since its creation in 1935. Over 770,000 individuals and families in Louisiana receive monthly Social Security benefits. Social Security creates a foundation of income for workers to build a retirement plan. For example, over 59 percent of Louisianans who receive Social Security benefits are retired workers and their families. Social Security also serves as an insurance protection plan for families of workers who die or become disabled.
Social Security benefits are based on the amount the worker contributes to Social Security in payroll taxes. The more a worker earns during his or her working life, the higher will be the Social Security. This means that lower-income workers will rely more heavily on Social Security benefits when they retire because of their lower lifetime earnings and fewer opportunities for them to save and earn pensions. The full retirement age an individual can receive Social Security benefits is currently 66, but will increase to 67 over the 2017-2022 periods.
The average monthly Social Security benefit that a resident in Louisianan receives is $1,073.80, or less than $13,000 annually. With a current trust fund balance of $2.6 trillion, Social Security will be able to pay full benefits to individuals in Louisiana and across the country through 2037. Even without any modifications to how Social Security is funded, current levels of payroll taxes will fully fund three-fourths of benefits to individuals after 2037. Thus, to keep Social Security fully funded will require only modest increases in the amounts workers pay during their work lives.
