What is always a hot topic during elections and often discussed at the water cooler - Is the SSA trust fund going to run out? and if so - when? The new report from the Board of Trustees was released on May 13th, 2011. The Social Security Act requires the Board of Trustees to issue an annual report to Congress regarding the trust fund.
Before I give you the highlights of the 2011 report it is important to understand that there are actually two trust funds. The 'Old Age and Survivors Insurance' (OASI) and the Disability Insurance trust fund. For most intensive purposes they are treated as one trust fund.
The report found that if NO action is taken (i.e. no new laws that alter or amend the Social Security Act) that the trust fund will be able to pay 100% of scheduled benefits until 2036. The 2010 report stated that the benefits would be payable until 2037.
More disturbing figures are discovered when you look at the solvency of each trust fund. The report finds that the disability trust fund will be depleted in 2018. That is not a typo - 2018. The much larger OASI trust fund is solvent through 2038.
Why is the disability trust fund in such danger? A recent paper by the Center on Budget and Policy Priorities opines that Baby Boomers have recently moved into their high-disability years. The number of disability beneficiaries has doubled since 1995. In addition, more women have moved into the workforce and have become eligible for disability benefits.
The entire 2011 Trustees Report can be found at www.ssa.gov/OACT. However, a much easier to read and understand paper was published by the National Academy of Social Insurance and can be found at www.nasi.org
