Hundreds of thousands of Americans 65 through
69 will no longer lose Social Security benefits because they keep
"This should be a happy day for Americans of all ages today
because a very good thing has been done for the future," President
Clinton said as he signed a bill eliminating the Social Security
Clinton said the earnings cap "made some sense in the Great
Depression when the nation was desperate to find jobs for young
workers with families and the unemployment rate in our nation was
"Conditions today could hardly be more different," Clinton
said. "The economy is booming, the unemployment rate (is) at its
lowest point in 30 years, companies desperately need more workers.
Older Americans have the skills and the experience that businesses
The bill was approved without dissent by an election-year
Congress. "For too many years, America's working seniors have been
getting penalized," House Speaker Dennis Hastert said. "Starting
today they will get the paycheck they deserve."
In signing the bill, Clinton also unveiled an Internet service
offered by the Social Security Administration for younger Americans
who want to get an online estimate of future retirement benefits.
"Our new Internet service ... will accomplish step one of
retirement planning, helping workers to understand the amount of
Social Security benefits they can expect in retirement," said
Social Security Administrator Kenneth S. Apfel.
Congress passed legislation repealing Social Security's earnings
limit last month, without a dissenting vote. It was hailed by
Republicans and Democrats alike as long overdue.
The penalty is left over from an era of high unemployment when
policy-makers wanted to encourage older Americans to retire and
make room for younger workers. It has reduced Social Security
payments by $1 for every $3 a beneficiary between the ages of 65
and 69 earned in wages over a certain amount $17,000 in 2000.
Now, employers facing a tight labor market are clamoring for
more workers and there are many jobs in retail and services that
are a perfect fit for people over age 65.
The repeal is retroactive to Jan. 1 and directly affects 800,000
Social Security recipients who are working this year and another
100,000 who haven't sought benefits because they have jobs. With
the earnings test eliminated, each of these people could receive an
additional $6,700 in Social Security this year.
Because the repeal is retroactive, about 415,000 working seniors
or dependents will get refunds for the money already deducted this
year from their Social Security checks a total of $1.4 billion or
an average of $3,500 per person.
Apfel has said those checks should be sent by early May and
monthly benefits adjusted by June.
For younger Americans interested in planning for retirement,
Social Security's new Internet service offers three increasingly
detailed levels of benefit estimates, each requiring the user to
type in more information about themselves.
The simplest, "quick calculator," asks only for a person's age
and current-year earnings. The most sophisticated requires the user
to download software onto a home computer and allows him or her to
try out various retirement scenarios.
The new online retirement calculators will not tap into private
records that Social Security keeps about individuals' work and
earnings histories. They rely solely on information provided by
The Social Security Administration met with privacy concerns
raised by Congress and in 1997 dismantled a service giving people
the opportunity to check their Social Security records online.
Starting this year, the agency is providing that information
including official earnings records and benefit estimates based on
them to all Americans over age 25 the old-fashioned way: in
annual mailings, via the post office.