When we started writing about Social Security nearly 40 years ago, the long-term financial crisis of the program was in the next century.
But today we are in the next century, the baby boom’s retirement has begun and the impending bankruptcy of Social Security is here, Social Security’s actuaries report.
The latest Annual Report of the Social Security Board of Trustees projects that Social Security will run short of funds to pay promised benefits as soon as 12 years from now, in 2028.
Indeed, Social Security’s disability insurance is running out of funds to pay promised benefits this year, assumed to survive only by borrowing from the rest of Social Security.
Most seniors retiring today will still be alive in 2028, when Social Security will be able to pay only 71% of promised benefits, and declining, under so-called pessimistic assumptions.
But studies last year from researchers at Harvard and Dartmouth showed that Social Security’s actuaries routinely underestimate the program’s financial problems. So-called pessimistic projections often turn out closer to reality than “intermediate” projections.
Nevertheless, even under intermediate projections, Social Security would run out of funds to pay promised benefits by 2034, just 18 years from now. The program then would only have funds to pay 79% of promised benefits, and declining.Read the rest of this IBD editorial HERE.
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