Social Security Payments Will Increase by More Than $2,000 Under the New Bill

Social Security payments are critical financial assistance, often granted monthly to seniors in their retirement years and people with disabilities. In addition, when a Social Security beneficiary dies, their family members are eligible for survivor benefits, which include a lump sum death payment.

The lump sum death payout has been constant at $255 for decades, dating back to 1954. This amount, meant to assist families in times of loss, has not been updated to reflect the changing economic reality.

Proposed increase of $2,900 for Social Security death benefits

Despite significant inflation raising the cost of life for Americans, including necessities such as groceries, housing, and healthcare, the lump sum payout has not increased. This financial burden has led to growing funeral prices, making many families’ present payments insufficient to cover death-related bills. Lawmakers supporting the Social Security Survivor Benefits Equity Act are emphasizing this disparity.

• Rising Costs: Inflation has driven up prices across the board, impacting everyday living expenses.
• Funeral Expenses: The cost of funerals has surged, adding financial burdens to grieving families.
• Outdated Payment: The $255 payment, set in 1954, no longer meets today’s economic realities.

Legislative Efforts To Adjust Death Benefits

This week, Democratic Vermont Senator Peter Welch offered a unique suggestion. The proposed bill aims to raise the death benefit to $2,900, ensuring that it correctly reflects current inflation levels.

Support from Prominent Senators

Independent Senator Bernie Sanders of Vermont and Democratic Senator Elizabeth Warren of Massachusetts have teamed up to co-lead this vital bill.

Concerns about rising funeral costs

Senator Welch echoed many others’ feelings, stating, “Funeral costs should be the last concern for grieving families who have just lost a loved one.” He said: “Due to benefits not keeping up with inflation, the financial burden of burying a loved one has become a pressing issue for many mourning families.”

When the original $255 lump sum death payment was implemented, it was possible to arrange a full funeral and cremation service for only $700. As of today, the average cost has risen to $6,280, according to the National Funeral Directors Association.

The Increasing Cost of Funerals

If you’re thinking about having a coffin funeral, expect the costs to skyrocket, with an average of $8,300.

The Need for Change

According to Thompson, the proposed bill is quite likely to pass. The death payment has not been adjusted for inflation in 70 years, having remained stable since the 1950s.

“People often snicker at the amount provided by the Social Security death benefit,” Thompson told me. “It urgently requires an increase to keep up with inflation.” This adjustment would be extremely beneficial to families during these difficult times since they frequently struggle to raise finances to bury their loved ones.

The Uncertain Future of Social Security’s Death Benefit Bill

What happens if the bill passes?

If this new measure is passed, the increased amount of $2,900 will take effect in 2025, adjusted for the consumer price index for urban wage earners and clerical workers.

Eligibility for Death Benefits

Currently, survivors can qualify for the death payment under the following conditions:

• You must apply within two years of your spouse’s or parent’s passing.
• The benefit is typically given to the surviving spouse.
• If there is no surviving spouse, the benefit might be transferred to the deceased’s children.

When a loved one dies, it is typically the responsibility of surviving to notify the Social Security Administration. This measure is critical to preventing fraudulent Social Security payments from being received.