Social Security benefits are important cash help that are usually given every month to seniors in retirement and people with disabilities. Also, when a Social Security recipient dies, their family members can get survivor benefits, which include a death payment in one lump sum.
There has been no change in the lump sum death payment for decades. It has always been $255, the same amount since 1954. This amount, which was meant to help families after a death, has not been changed to represent how the economy has changed.
Proposed increase to $2,900 for Social Security death benefit
The cost of life for Americans has gone up a lot due to inflation, but the lump sum payment has not gone up. This includes things like groceries, housing, and medical care. Rising funeral costs are another thing that is putting a strain on families’ finances.
For many families, the current payment is not enough to cover the costs of a death. This difference is being brought up by lawmakers who support the Social Security Survivor Benefits Equity Act.
- 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- Outdated Payment: The $255 payment, set in 1954, no longer meets today’s economic realities.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 Senator Peter Welch of Vermont put forward an important plan. The proposed law would raise the death benefit to $2,900, which would make sure that it matches the current level of inflation.
Support from Prominent Senators
Independent Senator Bernie Sanders from Vermont and Democratic Senator Elizabeth Warren from Massachusetts have joined forces to co-lead this important bill because they both support this idea.
Concerns Over Rising Funeral Costs
Like many others, Senator Welch said, “Funeral costs should be the last thing on the minds of families who have just lost a loved one.” He said, “Because benefits aren’t keeping up with inflation, the cost of burying a loved one has become a pressing issue for many families in grief.”
When the first $255 lump sum death payment was made, it was possible to plan a full funeral and cremation service for just $700. The National Funeral Directors Association says that the price has gone up to an average of $6,280 today.
The Rising Cost of Funerals
Expect the costs to go up even more if you want a funeral with a box, which costs an average of $8,300.
The Need for Change
Thompson says there is a good chance that the suggested bill will become law. The death payment hasn’t been changed since the 1950s, which is a shocking 70 years since it was last adjusted for inflation.
Thompson said, “People often laugh at the amount that the Social Security death benefit gives.” “It needs to go up badly to keep up with inflation.” Families are having a hard time getting the money they need to bury their loved ones right now, so this change would help them a lot.
The Uncertain Future of the Social Security Death Benefit Bill
What Happens if the Bill Passes?
If this new bill passes, the higher number of $2,900 would start to apply in 2025, with changes based on the consumer price index for wage earners and office workers in cities.
Eligibility for the Death Benefit
Currently, survivors can qualify for the death payment under specific conditions:
- You must apply within two years of your spouse’s or parent’s death.
- The benefit is generally awarded to a surviving spouse.
- If no surviving spouse is present, the benefit can be directed to the deceased person’s children.
People who are close to the deceased often have the important duty of telling the Social Security Administration about the death. This must be done right away to stop any unnecessary Social Security funds from being sent out.
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