7 Reasons Social Security Is in Big Trouble
Social Security is our nation's most successful social program, but that doesn't mean it's impervious to problems. As evidenced by the latest report from the Social Security Board of Trustees, the program is less than 16 years from big trouble.
According to the Trustees, Social Security is on track to expend more in 2020 than it generates in revenue for the first time since 1982. This net-cash outflow, while small, will grow exponentially in size with each passing year. By the time 2035 rolls around, the nearly $2.9 trillion in asset reserves that the program has built up since inception -- and which is currently invested in special-issue government bonds -- will be completely exhausted.
Should this excess capital disappear, Social Security wouldn't be bankrupt, but it would be in line to pass along an across-the-board benefit cut of up to 23% to retired workers. Given that retirees are more reliant on Social Security than ever, this isn't a rosy outlook.
Source Fool.com
