Is So­cial Se­cu­rity healthy?

The Week (US) - - News 17 -

The So­cial Se­cu­rity trust fund has been run­ning a sur­plus ev­ery year since 1982. In 2016, the pro­gram brought in $35 bil­lion more than it paid out, ac­cord­ing to the So­cial Se­cu­rity Trus­tees, and it now has some $2.85 tril­lion in re­serves. But those an­nual sur­pluses are fore­cast to stop some­time in the next decade, as more Baby Boomers be­gin to claim ben­e­fits. That will eat into the re­serves and tap the trust fund out by 2034—the year when to­day’s 51-year-olds reach full re­tire­ment age. That doesn’t mean So­cial Se­cu­rity checks will all of sud­den come to a halt. But it’s pro­jected that the pro­gram will have only enough rev­enue com­ing in to pay 77 per­cent of promised ben­e­fits. For some­one ex­pect­ing $2,000 a month, for in­stance, the pay­ment could shrink to $1,540. Watch­dogs say that mak­ing the pro­gram sol­vent for longer will re­quire higher So­cial Se­cu­rity taxes, a slower growth in ben­e­fits, in­creas­ing the full re­tire­ment age—or all three. “Ev­ery year as a na­tion we do noth­ing,” said Ali­cia Mun­nell, di­rec­tor of the Cen­ter for Re­tire­ment Re­search at Bos­ton Col­lege. “Ben­e­fits have to be cut or rev­enue in­creased, be­cause the sys­tem is not al­lowed to pay out money that it does not have.”

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