Update on the Status of the Social Security System
A couple of weeks ago the Social Security Board of Trustees released their annual report that includes the status of the Social Security trust funds. The system we know as Social Security is made up of two trust funds, the OASI (Old Age and Survivors Insurance trust fund) and the DI (Disability Insurance trust fund). Collectively they are referred to as OASDI, but are technically two separate trust funds. Think of these trust funds as a holding tank where all the withholding taxes and other system earnings are accumulated and then removed when the system pays benefits.
The 2017 annual report predicts that the combined funds (if they look at it as one large bucket) is expected to be depleted in 2034. After that, Social Security will then restrict benefit payments to about 77% of what is promised. This will occur if no changes are made to the benefit structure or funding of these programs.
The DI fund alone has a little better news as its anticipated life has been extended 5 years to 2028 from last year’s estimate of 2023. Since Congress moves funds between these two accounts, the date most folks are paying attention to is the 2034 estimate of the combined funds being depleted.
Once again this year we are hearing the warning bell ring that Congress needs to address this issue. Will they hear the call and act?
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