The Social Security Board of Trustees issued some chilling statistics in its annual report last week:
- The combined Trust Funds will be exhausted in 2033, three years sooner than was projected last year. At that time, contribution income would pay only 75% of scheduled benefits.
- Social Security’s disability program, which helps support 11 million people, will run through its trust fund in 2016, two years earlier than predicted.
- The trust fund that supports Medicare, the health-care program for the elderly, will run out of money in 2024.
- To cover all scheduled benefits over the next 75 years, the Trust Funds would need an immediate contribution of $8.6 trillion.
- The assets of the combined OASDI Trust Funds increased by $69 billion in 2011 to a total of $2.7 trillion.
- Non-interest income fell below program costs in 2010 for the first time since 1983. Program costs are projected to exceed non-interest income throughout the remainder of the 75-year planning period.
The powers that be in Washington should study the Executive Life Insurance Company of New York (ELNY) story as a case study to show what happens if known financial problems are not addressed by regulators in timely fashion.
Consumers should plan ahead and take charge of their own destiny. I will be covering some financial planning options in an upcoming video podcast series