This week is a good week for millions of Americans because they could start getting a new $25,000 bonus if they meet certain conditions. Newsweek says that if Congress passes the Social Security program, it will help people who graduated from high school. Representative Dean Phillips of Minnesota introduced the American Dream Accounts Act in the House.
This bill would set up an investment account for every child born in the United States through a scheme run by the Social Security Administration. Almost $5,000 would be put into an index fund. The money could be accessed when the person got their GED or high school graduation or graduated.
A new Social Security benefit worth up to $25,000 after Americans graduate
According to the law, most Americans will be able to access $25,000 when their bonds mature. This is because by the time they can spend the money, it will have made about 10% per year. In a statement, Representative Dean Philips said, “everyone must have the same chance to achieve the American Dream in order for our great country to reach its full potential.”
Every child in the United States has the chance to grow up and reach their full potential because of this law. Philips also said that investment pays off and that now is the time to bet on American values like freedom of choice and equal opportunities for everyone by passing the American Dream Accounts Act.
The rule could also make it easier to make a down payment on a house, pay for school, or even start a business. Students could also use a smartphone app to track the performance of their investment portfolios. Rich and well-connected people shouldn’t be the only ones who can do it.
The head of the Universal Income Project, Jim Pugh, said that the American Dream Accounts Act will make sure that everyone has the chance to be successful in the long run by giving every child the means to follow their dreams. People who are in the Peace Corps or AmeriCorps would also be able to get a $10,000 bonus through the scheme.
The new Social Security benefit will provide young people with more money to invest
Alex Beene, a teacher of financial literacy at the University of Tennessee at Martin, says that the bill stresses how important it is for young people to learn about money and be able to handle their own. Beene thinks that people are more likely to understand the benefits of saving for the future when they have their own money.
For more information about what he said, please read the whole thing here. Finally, it is important to stress that the fund that provides Social Security benefits to seniors and disabled individuals will run out of money by the middle of the 1930s if Congress does not make changes.
The main trust fund that pays out Social Security benefits is expected to run out sometime in 2033 or 2034, according to the most recent government predictions. After that, guaranteed payments are expected to drop by almost 20%. The Committee for a Responsible Federal Budget recently put together a study that tries to put a number on the coming cut in benefits.
The study found that the average person with two incomes would lose $16,500 a year in benefits if they retired before the trust fund ran out. The people who wrote the study say that both Donald Trump and Kamala Harris promised to “protect” Social Security when they were running for office.
But neither has said how they plan to do that. The nonpartisan advocacy group says that Trump wants to cut taxes from Social Security checks, which would make the program’s financial problem much worse.
So, politicians need to fix the program’s money problems in the next few years so that millions of Americans can enjoy a better retirement. The good news is that lawmakers have many options to help change direction without putting too much pressure on any one group of stakeholders.