Social Security Benefits Could Be Cut in 2035, One Year Later Than Previously Forecast
Social Security Benefits Could Be Cut in 2035, One Year Later Than Previously Forecast
Projected cuts to Social Security benefits now expected in 2035, one year later than earlier predictions. Learn more.
The Social Security Administration (SSA) announced on Monday that it has enough funds to pay all scheduled benefits and associated administrative costs until 2035, one year later than projected last year. According to the SSA, the projected long-term finances of the program have improved this year primarily due to an upward revision to the level of labor productivity over the projection period and a lower assumed long-term disability incidence rate.
OASI and DI Trust Funds Projections
The Old-Age and Survivors Insurance (OASI) Trust Fund is projected to be able to pay 100% of total scheduled benefits until 2033. After that, the fund’s reserves will become depleted, and continuing program income will be sufficient to pay 79% of scheduled benefits. The Disability Insurance (DI) Trust Fund is projected to be able to pay 100% of total scheduled benefits through at least 2098.
If the OASI Trust Fund and DI Trust Fund projections are combined, the resulting projected fund would be able to pay 100% of total scheduled benefits until 2035. After that, the fund’s reserves will become depleted, and continuing total fund income will be enough to pay 83% of scheduled benefits.
The Hospital Insurance Trust Fund, one of two funds used to fund Medicare, is projected to be able to fund the program until 2036, which is five years later than reported last year. Once those funds are depleted, Medicare would be able to cover 89% of scheduled benefits.
Statements from Commissioner and President
Commissioner of Social Security Martin O’Malley said in a news release, “This year’s report is a measure of good news for the millions of Americans who depend on Social Security, including the roughly 50% of seniors for whom Social Security is the difference between poverty and living in dignity – any potential benefit reduction event has been pushed off from 2034 to 2035.”
President Joe Biden said in a statement on Monday, “Medicare is stronger and Social Security remains strong. As long as I am President, I will keep strengthening Social Security and Medicare and protecting them from Republicans’ attempts to cut benefits Americans have earned.”
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