America's entitlement programs that were designed to alleviate elderly poverty, are beginning to benefit the wealthy more than the poor. That creates a challenge for lawmakers who need to change the programs to keep them solvent.
Social Security and Medicare have been extraordinarily successful in achieving their primary purpose of alleviating elderly poverty in the U.S. Since the inception of the programs, elderly poverty has decreased dramatically since they ensure that older Americans have money to live on and receive health care.
While wealthier Americans, in Cincinnati and elsewhere, are seeing an average increase in lifespan, the least well off white Americans are, on average, beginning to live shorter lives. Financial Advisor points this out in "The Rich Are Living Longer And Taking More From Taxpayers."
The result of this trend is that wealthy Americans are receiving a disproportionate amount from the Social Security system. However, when all government benefit programs are considered, the lowest income levels and the wealthiest receive about the same overall.
The problem is that the Social Security system needs to be fixed, to make sure it remains solvent.
One way to fix it is to increase the retirement age, but that will make the problem worse. Wealthier Americans will not be affected as much as many poorer Americans who will not live to see any benefits. This will effectively make their payments into the system a tax on them for the benefit of the wealthy.
Another solution is through means-testing Social Security, but the program was designed without means-testing to make it more difficult to cut later on.
There is not an easy solution to the problem and the best result might be to improve the diminished life-expectancy of poor Americans.
Remember: “An ounce of prevention is worth a pound of cure.” When making your estate plans or when probating an estate or administering a trust, do not go it alone. Be sure to engage a Cincinnati estate planning attorney.
For more information about estate planning, probate or trust administration in Cincinnati (and throughout the rest of Southwest Ohio) and to review free resources regarding estate planning, probate or trust administration, visit my website. If you have questions regarding this article or a particular legal matter, feel free to contact me at 513-399-PLAN (7526).
Reference: Financial Advisor (April 24, 2017) "The Rich Are Living Longer And Taking More From Taxpayers."