Source: Wall Street Journal 4/24/12
Reported yesterday that earlier estimates were 24 years, but now 21 years. If reserves for disability benefits were combined with retirement, reserves would be exhausted by 2033. Social Security and Medicare account for 1/3 of the federal budget. If the trust funds are not replenished, then benefits would be reduced by 25%.
Everyone should be concerned about this, even those that are already retired, since people are living much longer these days.
|Year of birth||Full retirement age (FRA)||Your Age this Year||Years to retirement FRA||Year of Retirement||Age Soc Sec Reserves Exhausted (2033) & benefits could be reduced|
|1955||66 & 2 m||57||9||2021||78|
|1956||66 & 4||56||10||2022||77|
|1957||66 & 6 m||55||11||2023||76|
|1958||66 & 8 m||54||12||2024||75|
|1959||66 & 10 m||53||13||2025||74|
A lot of people wonder if Social Security will actually go broke, and not be able to provide them with benefits. I am doubtful this will happen, given that seniors represent the largest voting block, so politicians are always very concerned about their votes. We will have to see either rapid growth in GDP or most likely increased taxes, reduced benefits, lower or no the inflation increases and older Full Retirement Ages for younger workers, to secure these benefits. Due to the recession, declined stock portfolios, many people have much lower retirement savings and will be depending upon Social Security for a major part of their retirement. This issue is going to continue to be a hot one.