The Social Security Board of Trustees released its 2019 annual report on the long-term financial status of the Social Security trust funds. The combined asset reserves of the Old-Age and Survivors Insurance and Disability Insurance (OASI and DI) trust funds are projected to become depleted in 2035, one year later than projected last year, with 80% of benefits payable at that time.
The OASI trust fund is projected to become depleted in 2034, the same as last year’s estimate, with 77% of benefits payable at that time. The DI trust fund is estimated to become depleted in 2052, extended 20 years from last year’s estimate of 2032, with 91% of benefits still payable.
The Board of Trustees usually comprises six members. Four serve by virtue of their positions with the federal government, Secretary of the Treasury and Managing Trustee; Commissioner of Social Security, Secretary of Health and Human Services and Secretary of Labor. The two public trustee positions are currently vacant.
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Teaching Suggestions
- Ask students if they are concerned about the future of Social Security. Do they believe that Social Security will be there when they retire?
- Ask students to debate the issue, “Social Security is not sustainable over the long term at current benefit and tax rates.”
Discussion Questions
- What is the outlook for future Social Security and Medicare costs in relation to GDP?
- What might be the implications of rising Social Security and Medicare costs?
- How are Social Security and Medicare financed?
- How do longer life expectancies and early retirements affect the future of Social Security?
Melissa Hart
Focus on Personal Finance, 7e 