As one Social Security program marks a 50-year anniversary, here’s how benefits may change

Personal finance

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A federal benefit program for people with disabilities and older adults made its first benefit payments 50 years ago.

In 1974, Supplemental Security Income, or SSI, began sending the first monthly checks starting at around $140 per individual, or $210 per couple.

In 2024, the maximum monthly benefit is $943 for individuals and $1,415 for eligible couples. However, the average monthly benefit for individuals is around $698.

That is well below the federal poverty level, which in 2024 is around $1,255 per month for an individual.

Experts say the program — with more than 7 million beneficiaries who must have little income or resources in order to qualify — could be updated to better fulfill its intended mission as a financial lifeline when former President Richard Nixon signed the program into law in 1972.

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SSI benefits come with strict restrictions. Income from work and other sources may reduce how much beneficiaries receive from the program. Additionally, they must stay under certain asset limits — $2,000 for individuals and $3,000 for couples — or risk suspension or termination of their benefits.

The rules are not only a burden for beneficiaries, but also the Social Security Administration.

“For all the people that receive SSI, it’s really only 4% of our total benefits that we lay out as an agency, yet it accounts for 38% of our administrative overhead and workload,” Social Security Commissioner Martin O’Malley said at a National Academy of Social Insurance event last week in Washington, D.C., to commemorate the program’s anniversary.

Updates aimed at improving benefit access

The Social Security Administration is taking steps to try to reduce some of the restrictions that come with SSI benefits.

The agency has announced that it will no longer count food as unearned income — formally known as in-kind support and maintenance, or ISM — which penalizes beneficiaries when their family provides dinner for them, for example. It is also expanding the rental subsidy policy for SSI applicants and beneficiaries, as well as the definition of a public assistance household. Those changes are slated to go into effect starting Sept. 30.

Those changes should allow more people to access and qualify for SSI, O’Malley said.

Moreover, the agency has also made it easier for beneficiaries to request waivers for overpayments, or excess benefits they may have received. It also increased the SSI underpayment threshold to $15,000 from $5,000, which has helped resolve backlogged cases.

Congress may implement more changes

Congress may further improve the program through additional reforms.

By bringing the Social Security Administration’s operating overhead up to where it was a decade ago, the agency could further work to alleviate disability application approval and phone assistance wait times, according to O’Malley.

“It would not add a single penny to the federal debt, because you already paid for it,” O’Malley said.

Moreover, experts argue raising the SSI’s asset thresholds — which have not been increased in about 40 years — could help beneficiaries achieve better financial security.

Two bills in Congress have proposed significant SSI reforms.

Democrats have proposed the Supplemental Security Income Restoration Act, which calls for increasing the program’s asset limits, setting the minimum benefit at 100% of the federal poverty level, streamlining the claiming process, and getting rid of certain reductions in benefits.

Another bipartisan proposal — the SSI Savings Penalty Elimination Act — would increase the asset limits to $10,000 per individual and $20,000 per couple, up from $2,000 and $3,000, respectively. Consequently, it would eliminate the marriage penalty current beneficiaries face.

“There is clear momentum behind the SSI Savings Penalty Elimination Act,” Emerson Sprick, associate director at the Bipartisan Policy Center’s Economic Policy Center, said at the NASI event.

The question is whether Congress can attach it to another legislative effort — perhaps related to spending — to get the proposed changes passed in the near future, he said.

Broader updates needed, advocates say

Advocates say further loosening the program’s current rules would have dramatic positive effects.

Under current limitations, at work, SSI beneficiaries may not be able to contribute to a 401(k) or earn raises. Students may not be able to take a paid internship for fear the income could affect their benefits, said Rylin Rodgers, disability policy advisor at Microsoft.

“In order to be successful, [we] need disabled workers in all job types,” Rodgers said.

“SSI, while critical, is at an influx point where in some cases it’s creating a block to that talent,” she said. 

Individuals who receive both Social Security and SSI benefits may see reductions to their payments. Loosening those rules would help lift more elderly and disabled individuals out of poverty, according to Wendell Primus, a visiting fellow at Brookings and former senior policy advisor on health and budget issues to former House Speaker Nancy Pelosi, D-Calif.

SSI benefit amounts could also be enhanced more broadly for all beneficiaries, said Tracey Gronniger, managing director for the economic security team at Justice in Aging, an advocacy group for fighting senior poverty.

“We need to increase the benefit level significantly … to at least the rate of poverty,” Gronniger said.

The poverty rate may also be improved by helping to increase SSI participation in underserved communities, particularly for people of color, she said.

While recent updates to food and housing policies will help, there is more room to update outdated policies that can interfere with access to benefits, said Jennifer Burdick, divisional supervising attorney at the SSI unit at Community Legal Services of Philadelphia.

“It’d be really great if Congress could just fix the bigger issues with the program so we wouldn’t have to look at other ways to try to come up with solutions to problems that Congress isn’t fixing,” Burdick said.

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