Social Security Actuary Reveals Worst-Case Scenario Regarding Program’s Future Funding
The one big question looming over everyone’s head is whether Social Security will be there throughout their retirement. According to an article by CNBC, current workers worry that the program could run out of money before they retire and they will not get back the funds they paid in, while retirees fear their benefit checks could disappear.
While it is true that Social Security is paying out more than it is taking in, causing the trust fund to shrink, the Administration’s Chief Actuary Stephen Goss says there is no reason to panic. In a recent interview, Goss shared that Social Security “is a long way from not having any money to pay for any benefits. So, people should not worry about the trust fund running out of money, as is sometimes said, and having an inability to pay any benefits.”
Worst Case Scenario
However, Goss did acknowledge that Social Security may reach a point within 10 years where the program may only be able to pay about 80 percent of scheduled benefits. At that point, the income coming into the program will be less than what is required to pay benefits under current law.
Goss explained that “Social Security’s actuaries are responsible for estimating the future costs of benefits that must be paid and comparing that with the amount of revenue projected to come in. When there is an imbalance, as with the current projected shortfall, it is up to Congress to make changes.”
Shoring Up Social Security Solvency
Fortunately, some lawmakers are taking action to protect America’s retirees by proposing plans to resolve the pending funding shortfall.
The Seniors Trust believes the solution has already been introduced. We want Congress to enact The Social Security Expansion Act. This landmark bill buttresses the long-term solvency of Social Security by expanding benefits for seniors — not cutting them.
If passed, this legislation will make four major changes to Social Security for retirees:
• Benefits will be increased for most recipients by about $200 per month.
• The Consumer Price Index for the Elderly (CPI-E) will be used to calculate Social Security Cost-of-Living Adjustments (COLAs) instead of the Consumer Price Index for Urban Wage Earners (CPI-W) used currently. The CPI-E takes the unique spending habits of seniors into account — particularly regarding the cost of healthcare — and offers a more realistic COLA for retirees.
• The minimum Social Security benefits would be increased to provide higher payments to seniors and greatly reduce senior poverty.
• The long-term solvency of the Social Security program would be guaranteed.
