Social Security Isn’t Going Bankrupt
Despite all the gloom and doom you may hear in the media, especially during election cycles, there is no danger of Social Security going away as feared by many young people now early in their careers. By original design, Social Security is self-funded from payroll taxes paid by working Americans, and from income taxes collected on benefits paid to those with higher incomes. So as long as there are people working (forever), Social Security will always be there to pay benefits. The issue is that income from payroll tax and collected income tax is now less than benefits being paid, so money from the Social Security Trust Fund is used to make up the difference. The Trust Fund held nearly $3 trillion at the end of 2019, but will (according to Social Security’s Trustees) be depleted by about 2035, necessitating an across the board cut in benefits. That is true, however, only if Congress continues to neglect reforming the program to avoid depletion of the Trust Fund. All of this is described in this Motley Fool article by Kailey Hagen. Click here to read more.
(One point of note not mentioned in the article is that interest from Trust Fund investments also now helps Social Security finances (over $80 billion annually), but interest income will lessen as the Trust Fund is depleted).
AMAC has been at the forefront trying to strengthen Social Security by developing and proposing its Social Security Guarantee. AMAC has been discussing and continues to discuss this common-sense solution with Congressional Representatives in its efforts to protect America’s senior citizens who rely on Social Security. To review AMAC‘s Social Security Guarantee, click here.