Social Security was never meant to be the primary source of income for people when they retire, but it is the main source of money for many older Americans. A recent Wall Street Journal article noted that one in seven Social Security recipients age 65 and older rely on their retirement benefits for nearly all of their income.

That is not what Social Security is supposed to do. According to Forbes, Social Security was created as part of FDR’s New Deal to help solve the poverty crisis among older Americans after the Great Depression. Social Security was supposed to be a supplement to retirement savings. “It was never intended to create a wealthy retirement, but rather to meet the basic needs of older Americans for food and shelter.”

Social Security Solvency

Social Security was set up as a pay-as-you-go system. It is funded through the payroll taxes workers pay based on their earnings. That money is used to pay current beneficiaries. Any money leftover from payroll taxes, after paying beneficiaries, goes into the Social Security trust fund.

The problem is that there are now more retirees than workers. Social Security is no longer collecting enough payroll taxes, so it has been forced to tap into its trust fund to pay current benefits.

Experts predict the trust fund could be depleted in less than ten years. At that point, Social Security will likely need to cut benefits dramatically — possibly more than 20 percent!

Policymakers Need to Act Now

To stop potential benefit cuts, lawmakers need to act now. Several ideas have been floated such as increasing the full retirement age, increasing the proportion of income subject to payroll taxes, and reducing benefits for retirees with higher levels of total income.

The Seniors Trust believes the best way to address Social Security solvency is to pass the Social Security Expansion Act. This landmark piece of legislation would establish a long-lasting, dependable trust fund and pay full fair benefits for seniors. 

Show Your Support

If you support The Seniors Trust’s mission to buttress the long-term solvency of Social Security by expanding benefits for seniors — not cutting them — please add your name to our petition to Congress.