Social Security Trust Fund Depletion Pushed to 2035 in New Report
Every year the Trustees of the Social Security and Medicare trust funds issue a report on the current and projected financial status of the two programs. Using a mid-level set of assumptions, the Trustees are predicting that the costs of these programs will outpace the growth of gross domestic product (GDP) by the mid-2030s because of a rapidly aging population.
The two most commonly associated funds overseen by the Trustees are the Old-Age and Survivors Insurance (OASI) Trust Fund, and the Disability Insurance (DI) Trust Fund. Trustees are expecting the OASI Fund to be able to pay full scheduled benefits until 2034. This is one year later than the report predicted last year. If no current changes occur and the Fund continues based on the estimates of the Trustees, they predict that continued tax income will be able to pay 77% of scheduled benefits.
The DI Fund, on the other hand, is no longer projected to be depleted within the 75-year model. Last year the DI Fund was only projected to make payments until 2057.
The headline of this blog is misleading, it’s based on a hypothetical report by the Trustees that combines the OASI and DI funds to show the actuarial status of the Social Security program. Under current law, these funds are separate entities rendering the 2035 doomsday date moot.
For more information regarding Social Security and how to plan for it, please reach out to the professionals at The Center for Financial, Legal, & Tax Planning Inc., at 618-997-3436 or by visiting our website at www.taxplanning.com.
*Disclaimer – The information in the article above is only for general informational purposes. It is not to be construed as financial, legal, or tax planning advice. Please consult with your financial and/or tax advisor before making any financial decisions.