The doomsday scenarios surrounding the future of Social Security make for good newspaper headlines, but we are not in as dire of a situation as the media and politicians like to suggest sometimes. Reform is inevitable, though, as changing demographics and other trends have increasingly strained Social Security’s finances. Some of these factors include:
- The large Baby Boomer generation is entering into retirement
- People are living longer than ever before
- Workplace injuries have become more common in the past couple years because of “The Great Recession” and the fact that much of the rebound in employment has been in lower wage, more dangerous jobs
- Healthcare costs continue to increase, particularly in the later stages of life
Social Security’s finances: the good news
The good news about Social Security makes the headlines much less often than the bad news of imminent collapse and financial insolvency. A few weeks ago we mentioned one positive aspect of Social Security – its administration costs are extremely low (under 1 percent). Here are a few other positive facts that you may not have known:
- Social Security ended 2011 with a $2.7 trillion surplus
- Experts expect the surplus to grow until 2021(these figures, though, are constantly refined)
- Even under the worst scenarios, Social Security will still be able to pay out all or nearly all benefits for decades to come
- Benefits help a lot of people – over 61 million as of April 2012 with nearly 40 million of those beneficiaries being Americans aged 65 or older
- Because administrative costs are so low, over 99 percent of Social Security taxes paid into the system come out as benefits (you would be hard pressed to find any other organization running as efficiently as this)
Retirement and disability benefits provide assistance to some of the most vulnerable Americans – those over the age of 65 and those with severe disabilities who are unable to work. More details on how you qualify for SSDI or SSI benefits are available from experts at a Tulsa SSI law firm.
Have you or a loved one received Social Security benefits of some sort? How important are the benefits to your financial security?
Troutman & Troutman, P.C. – Tulsa Social Security disability attorneys