In June 2022, the Social Security Board of Trustees released its annual report on the 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 percent of benefits payable at that time.
The OASI Trust Fund is projected to become depleted in 2034, one year later than last year’s estimate, with 77 percent of benefits payable at that time. The DI Trust Fund asset reserves are not projected to become depleted during the 75-year projection period.
In the 2022 Annual Report to Congress, the Trustees announced:
- The asset reserves of the combined OASI and DI Trust Funds declined by $56 billion in 2021 to a total of $2.852 trillion.
- The total annual cost of the program is projected to exceed total annual income in 2022 and remain higher throughout the 75-year projection period.
“It is important to strengthen Social Security for future generations. The Trustees recommend that lawmakers address the projected trust fund shortfalls in a timely way in order to phase in necessary changes gradually,” said Kilolo Kijakazi, Acting Commissioner of Social Security. “Social Security will continue to be a vital part of the lives of 66 million beneficiaries and 182 million workers and their families during 2022.”
Other highlights of the Trustees Report include:
- Social Security paid benefits of $1.133 trillion in calendar year 2021. There were about 65 million beneficiaries at the end of the calendar year.
- During 2021, an estimated 179 million people had earnings covered by Social Security and paid payroll taxes.
- The cost of $6.5 billion to administer the Social Security program in 2021 was a very low 0.6 percent of total expenditures.
- The combined trust fund asset reserves earned interest at an effective annual rate of 2.5 percent in 2021.
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- Ask students if they or their family and friends are concerned about the future of Social Security? If so, what are their concerns?
- Ask students to make a list of documents they will need to establish their social Security account.
- What might be some reasons for the asset reserves to decline by $56 billion in 2021?
- Do you agree that Social Security will continue to be a vital part of the lives of 66 million beneficiaries and 182 million workers and their families during 2022? Why or why not?
- What percent of individuals age 65 and older would live in poverty without Social Security benefits?
- Would it be better for you to start getting benefits early with a smaller amount for more years, or wait for a larger monthly payment over a shorter time period?