For more stories like this, sign up for the PLANADVISERdash daily newsletter.
Social Security Trust Fund Unchanged From Last Year
The
Social Security Old-Age and Survivors Insurance, and Disability Insurance (OASDI)
Trust Funds are projected to become depleted in 2034, the same as last year’s
projection, with 79% of benefits payable in 2034. The DI Trust Fund itself will become depleted in 2023,
seven years further out than last year’s projection of 2026, with 89% of
benefits payable in 2023.
The annual report of the Social Security Trust Funds also indicated that total
assets of the OASDI Trust Funds increased by $23 billion in 2015 to a total of
$2.82 trillion. The combined trust fund reserves are still growing and will
continue to do so through 2019. However, beginning in 2020, the total cost of
the program is expected to exceed income. In order for the combined OASDI funds
not to become depleted in 2034, Congress will need to take some action, the
Social Security Administration said.
“I am pleased that Congress passed legislation, signed into law by President
Obama last November, to avert a projected shortfall in the Disability Insurance
Trust Fund,” said Carolyn Colvin, Acting Commissioner of Social Security. “With
the small, temporary reallocation of the Social Security contribution rate, the
DI fund will now be able to pay full disability benefits until 2023, and the
retirement fund alone will still be adequate into 2035, the same as before the
allocation. Now is the time for people to engage in the important national
conversation about how to keep Social Security strong.”
The report also indicated that total income to the OASDI Trust Funds was $920
billion in 2015, while total expenditures were $897 billion to a total of 60
million Social Security beneficiaries. The projected actuarial deficit over the
75-year-long projection is 2.66% of taxable payroll, 0.02 percentage points
smaller than last year’s report. During 2015, 169 million working Americans
contributed to Social Security through their payroll taxes.
The annual report can be viewed from here.
You Might Also Like:
Sounding the Alarm on Gender Inequality in Retirement
How Consumption Changes as Retirement Progresses
Retiree Poverty Rates Vary Substantially by State
« vWise, Schwab Retirement Technologies Partner on New Tools