Let’s Let Everyone Save For Retirement

U.S. public policy typically encourages saving. Our retirement system has undergone a major transformation over the past four decades, shifting workers to an individual savings-based system. Public policy supports saving for college costs, health costs, and emergencies, so it seems odd when a specific group of Americans is denied the ability to save, but that is precisely the situation facing people who receive Supplemental Security Income (SSI) benefits.

Established in 1974 by President Nixon and run by the Social Security Administration, SSI provides financial assistance to individuals who have limited income and resources, including those who are 65 or older, blind, or disabled. Unlike Social Security benefits, SSI is not based on work history. Instead, it is a needs-based program funded by general tax revenues, not Social Security contributions. The goal of SSI is to help eligible people cover basic expenses like food, clothing, and shelter. As of February 2025, approximately 7.4 million individuals were receiving SSI payments, which includes one million children.

Today SSI is one of the vital economic security programs provided by the Social Security Administration. SSI recipients have very low incomes, which is partly why they are eligible for the program in the first place. But they are subject to very strict asset limits while receiving SSI – asset limits that have not been updated for more than forty years. The current asset limits are $2,000 for an individual and $3,000 for a married couple, which means there is a marriage penalty for an SSI recipient who gets married while receiving benefits.

SSI recipients seem to find themselves in this unfortunate circumstance due to congressional neglect. The asset limits are not adjusted for inflation, so they have remained stagnant for four decades. Many SSI beneficiaries have a disability, but significant societal changes over the past four decades have increased opportunities for people with disabilities to participate in the workforce. However, some employed people with disabilities find themselves unable to participate in their employer’s 401(k) plan or even receive a bonus because doing so would push them above the asset limit and stop them from receiving their SSI benefits, which they need in addition to their earnings.

This issue has not received the attention it should, but Americans strongly support a change in policy. Polling released earlier this year found that two-thirds of Americans support either increasing or eliminating the SSI asset limit. That support was strong across the board regardless of whether the respondent was a Republican, a Democrat, or an independent. The option with the most support was to raise the asset limit to $10,000 for an individual and $20,000 for a couple and to exempt retirement savings from the limit.

Fortunately, Congress seems to have woken up to the need to update SSI policy on this front. A bipartisan, bicameral piece of legislation called the SSI Savings Penalty Elimination Act was recently reintroduced in the new Congress. This bill would raise the asset limits to $10,000 for an individual and $20,000 for a couple. Retirement savings would still remain subject to the limit, but the bill is a step in the right direction of enabling more people to save.

Recent public policy, such as the SECURE Act and SECURE 2.0 Act, has encouraged Americans to save more for retirement. It’s unfortunate that SSI policy isn’t on the same track. It seems shortsighted that some Americans are punished for saving because they need extra economic security today. Hopefully this policy will finally be updated after more than four decades and we can let everyone save for retirement.