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Wednesday, June 22, 2016

Will Social Security Really Go Broke 20 Years?

According to a government report recently released the Social Security trust fund should be broke in 20 years. This means that it is protected in the long run but will begin to underfund the needs of senior citizens. The analysis conducted by the government is beneficial because it gives us some time to start finding solutions.

While I have not seen the actual details of the analysis I do wonder if Baby Boomers and potential new revenue from Mellennials are calculated into its projection. A few of the reasons why Social Security is going bankrupt is because the large Baby Boomer expenditures based on increasing health care costs and age were not replaced by Generation X.

However, Mellinnials are very large group of 75.4 million, when compared with Baby Boomers, who are 74.9 million, thereby allowing for an increase in Social Security funds. A large percentage of Baby Boomers will be passing away over the next decade and with only a small Generation X to take money out of the system it might see much higher revenues when compared to expenses

Perhaps these calculations are already added or perhaps they have not been fully factored in. I do wonder if it is possible that Social Security will not only not run out of money but could possibly be fully funded starting a decade or so down the road. The tides in eligible workers that can pay into the system are increasing and this should, if it already isn't, be calculated into the projection.

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