A recent blog post discussed the solvency of Medicare and Social Security. We informed that the Social Security trustees announced in their annual report that the Medicare trust fund would be insolvent by 2028 and the Social Security retirement and disability trust funds would be insolvent by 2034. It is important to note that insolvent doesn’t mean that the funds will be completely dry and unable to pay benefits, but those are the first years that these federal programs will be unable to meet 100 percent of obligations if nothing changes.
Obviously this is alarming, but last year we were informing that the Social Security Disability Insurance (SSDI) program was going to be insolvent by the end of this year and beneficiaries would see about a 20 percent cut in benefits. Late last year Congress made some adjustments between the retirement and disability funds and extended the solvency of the combined retirement and disability programs until 2034.
Obviously it is never good news when we have projected insolvency dates for crucial programs such as Medicare and Social Security, but news also came out that there is an extra $23 billion in the combined retirement and disability trust fund, which was not expected. Unfortunately, when there is good news related to anything having to do with Social Security you are not going to hear about it from most Republicans. Instead you will hear about how disability is robbing retirement and lazy Americans are living off the taxpayers.
Granted, an extra $23 billion is not going to save Social Security for a generation, but it adds to the solvency that will last at least another 18 years. This means that sometime within the next 18 years Congress will have to do something to extend Social Security’s retirement and disability programs. For more about the latest trustee report click here.
