Officials from Social Security have issued a stark warning concerning when the United States is projected to exhaust its funds.
Discussions about the economy are highly relevant at the moment, especially since President Donald Trump’s approval ratings in economic management have declined. This comes after many previously viewed the economy as a strong aspect of his first presidential term.
A poll conducted by Quinnipiac University earlier this month revealed that Trump received low ratings regarding his handling of the economy, with only 38 percent approving of his approach to trade.
Economic issues are on everyone’s mind, and a recent report from Social Security administrators is likely to heighten these concerns.
The report indicates that Social Security is on course to exhaust its trust funds by 2034, which is notably one year earlier than previously projected.
The annual report from the Social Security Board of Trustees, released on Wednesday (June 18), attributes this forecast to rapidly rising costs under the Social Security Fairness Act, which has increased benefits for millions of retirees.
Additionally, OASI, or Old-Age and Survivors Insurance, is expected to run out by 2033, with the associated trust funds following a year after.
This marks a significant change from last year’s report, which had suggested that benefit cuts would be necessary starting in 2035; that timeline now appears to have been brought forward.
Such developments are poised to affect the 70 million beneficiaries of Social Security.
Frank Bisignano, the commissioner of Social Security, stated: “Congress, along with the Social Security Administration and others committed to eliminating waste, fraud, and abuse, must work together to protect and strengthen the trust funds for the millions of Americans who rely on it — now and in the future — for a secure retirement or in the event of a disability.”
Even if the trust funds are depleted in the next few years, CBS News reports that funds will not vanish instantly.
The report suggests that those involved with Social Security would experience a reduction in their benefits ranging from 19 to 23 percent.
Despite this, beneficiaries are hopeful that such a scenario will be avoided, as there are increasing calls for Congress to intervene and modify the funding mechanism for the program.
AARP CEO Myechia Minter-Jordan commented: “Congress must act to protect and strengthen the Social Security that Americans have earned and paid into throughout their working lives.
“More than 69 million Americans rely on Social Security today and as America’s population ages, the stability of this vital program only becomes more important.”