Social Security Projected To “Go-Broke” Earlier Than Expected
I’m 32, and for as long as I can remember, I’ve heard about how Social Security was on its way to being depleted. It’s been a known issue, yet there’s been no meaningful legislation to address it. As a result, rising health costs and recent legislation have led to the projected “go-broke” date moving up for both Social Security and Medicare.
According to AP, an annual report released on Wednesday projects the go-broke date for the Social Security trust will occur in 2034, a year up from last year’s projection of 2035. For Medicare, the new date was a bit more drastic, going up from 2036 to 2033.
Now, to be clear, the go-broke date doesn’t mean benefits will be stopped outright. It simply means payouts will be given at a reduced rate.
For Social Security, it’s estimated that benefit payouts would be capped at 81 percent, and for Medicare, the government provided health insurance that covers people age 65 and older, it’s estimated that payments would only cover 89 percent of costs for patients’ hospital visits, hospice care, and nursing home stays. This reduction would significantly affect the 68 million Americans currently enrolled in Medicare,
The Social Security and Medicare trust funds are overseen by four trustees. The Treasury Secretary serves as managing trustee, with the Secretaries of Labor, Health and Human Services, and the Commissioner of Social Security being the other three. The trustee board technically has two other presidentially-appointed and Senate-confirmed trustees who serve as public representatives, but those roles have been empty for over a decade.
“Current-law projections indicate that Medicare still faces a substantial financial shortfall that needs to be addressed with further legislation. Such legislation should be enacted sooner rather than later to minimize the impact on beneficiaries, providers, and taxpayers,” the trustees state in the report.
The go-broke date for Social Security has fluctuated quite a bit in recent years, with annual reports from recent years projecting “go-broke” dates in 2026, 2028, and 2031, respectively.
A poll conducted by AP last month revealed that 3 in 10 Americans over 60 are not confident that Social Security benefits would be there for them if they needed them. Clearly, this news won’t do much to increase their confidence. Social Security Administration Commissioner Frank Bisignano, who was only sworn into his role last month, released a statement saying that “the financial status of the trust funds remains a top priority for the Trump Administration.”
This seems like another instance of the Trump administration being all talk, little action, as there seems to be very little meaningful legislation to address the issue. In fact, Trump’s “Big, Beautiful” budget bill has very little in the way of relief for Social Security and Medicare.
As a millennial with very little faith in America’s ability to improve upon itself, I would very much like it if I could opt out of paying Social Security because while I’m not over 60, I have very little faith that the benefits are going to be there for me by the time I can use them. Heck, at the rate we’re going, I’d honestly just be happy if we even have a functional democracy at that point.
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