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The health of Social Security

Saving & Investing
The health of Social Security

Some good news. Some bad news.

With approximately 94 percent of American workers covered by Social Security and 65 million people currently receiving benefits, keeping Social Security healthy is a major concern.

Social Security isn’t in danger of going broke, but its financial health is declining, and benefits may eventually be reduced unless Congress acts.

Each year, the Trustees of the Social Security Trust Funds release a detailed report to Congress that assesses the financial health and outlook of this program. The most recent report, released on June 2, 2022, shows that the effects of the pandemic were not as significant as projected in last year’s report.


Do you have questions about your Social Security benefits?

Before we dive deeper into the article, we know that you probably have some questions on when you can start receiving benefits and how much you’ll get. You may even be wondering how Social Security benefits will be able to supplement your other retirement options.

As a member of Arsenal Credit Union you have access to David Weis our knowledgeable Financial Advisor available through our broker-dealer CUSO Financial Services, LP (CFS)*.

In today’s market, it’s essential to work with a financial advisor who can provide you insight and guidance based on an understanding of your unique situation. If you have questions, please call David at 314.919.1058, email him at david.weis@cusonet.com or visit his website.

Visit David’s Website


Overall, the news is mixed for Social Security

The Social Security program consists of two programs, each with its own trust fund that holds the payroll taxes collected to pay Social Security benefits.

  • Retired workers, their families, and survivors of workers receive monthly benefits under the Old-Age and Survivors Insurance (OASI) program.
  • Disabled workers and their families receive monthly benefits under the Disability Insurance (DI) program.

Money that’s not needed in the current year to pay benefits and administrative costs is invested (by law) in special government-guaranteed Treasury bonds that earn interest. Over time, the Social Security Trust Funds have built up reserves that can be used to cover benefit obligations if payroll tax income is insufficient to pay full benefits

These reserves are now being drawn down. Due to the aging population and other demographic factors, contributions from workers are no longer enough to fund current benefits.


Full retirement and survivor benefits through 2034

In the latest report, the Trustees estimate that Social Security will have funds to pay full retirement and survivor benefits until 2034. The Disability Insurance Trust Fund is projected to be much healthier over the long term than last year’s report predicted, estimated to be able to pay full benefits through the end of 2096.

OASI and DI Trust Funds are separate, and generally one program’s taxes and reserves cannot be used to fund the other program. However, this could be changed by Congress, and combining these trust funds in the report is a way to illustrate the financial outlook for Social Security as a whole.

All projections are based on current conditions and best estimates of likely future demographic, economic, and program-specific conditions, and the Trustees acknowledge that the course of the pandemic and future events may affect Social Security’s financial status. You can view a copy of the 2022 Trustees report at SSA.gov.


Many options for improving the health of Social Security

The last 10 Trustees Reports have projected that the combined OASDI reserves will become depleted between 2033 and 2035. The Trustees continue to urge Congress to address the financial challenges facing these programs so that solutions will be less drastic and may be implemented gradually, lessening the impact on the public. A comprehensive list of potential solutions can be found on the Social Security Administration’s website.

View List of Potential Solutions


©2022 Broadridge Advisor Solutions, Inc.

*Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA / SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. The Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.