Annual Social Security Report Notes Slight Improvement in Financial Outlook
Tampa, FL (Law Firm Newswire) May 7, 2019 – Social Security trustees released their annual report on April 22 that projected the Disability Insurance (DI) trust fund would remain solvent until 2052, an additional 20 years than previously estimated.
The main trust fund for Social Security is Old-Age and Survivors Insurance (OASI). The estimated depletion date for that fund remains unchanged at 2034. However, if money from the disability program was used to cover OASI shortcomings, Social Security would become insolvent by 2035, just a year later than predicted in last year’s report.
“The financial health of Social Security depends on a variety of factors,” commented Florida social security disability attorney David W. Magann. “However, what’s important is that people who rely on these crucial disability benefits don’t see them interrupted or slashed due to reasons that are outside their control. It remains to be seen what action is taken to ensure the disability trust fund remains intact for future generations.”
If the fund becomes depleted, beneficiaries would receive 91 percent of their promised payments. That money will come from Social Security taxes taken out of workers’ paychecks. Around 10 million disabled workers and their dependents currently collect disability benefits while 53 million people receive OASI payments.
The marginal improvement in Social Security’s overall financial condition was attributed to a decline in SSDI applications since 2010 and decreasing numbers of disabled worker beneficiaries since 2014. Higher-than-estimated mortality rates in recent years have also played a role. A reduction in cost increases is predicted for the combined Social Security programs from 2040 as deceased Baby Boomer beneficiaries get replaced by generations with smaller birth rates.
The report urged lawmakers to address the financial shortfalls “sooner rather than later” so that there would be enough time to consider various solutions and “to phase in changes while giving the public adequate time to prepare.” Failure to act could result in automatic cuts to benefits should the programs run dry.