Social Security

Social Security Summary

 

According to the Office of Management and Budget of the Executive Branch of the Federal Government, the expenditures for social security payments went from $617 billion in FY 2008 to $773 billion in FY 2012. By FY2013, these expenditures were $814 billion and constitute 24% of the Federal budget. As baby boomers retire over the next years, the expenditures will increase dramatically. For instance, by 2019, Social Security expenditures are projected to be $1.131 trillion. This is a 39% increase in just 6 years.

 

 

The taxes to support these social security payments were less than the actual payments for the first time starting in 2010 and will continue to be in deficit for the foreseeable future. The surplus from the years prior to FY2010 were put into special bonds. These bonds are projected to be completely exhausted by 2033 and social security will be bankrupt at that point. As a consequence, all social security payments will be cut across the board by 23%. See latest report from the Trustees at http://ssa.gov/pressoffice/pr/trustee13-pr.html.

This is the overall Fund. However, the Social Security Disability Fund will be bankrupt by 2016 and requires immediate legislative action. If not addressed, disability income will be reduced 27% across the board for all recipients. To avoid bankrupting the retirement fund sooner than it should, new revenues or lowered costs in this disability program will be necessary.