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If Congress does not act

For millions of Americans, Social Security represents an important part of their future income. It may be the monthly payment from the retirement program that will make up a significant component, if not virtually all of their future retirement income.

For some, it will be from the disability insurance program that covers most workers in the event of disabling injury or illness, and would likely provides a significant part of those disabled worker's income. Both of these programs are vital to the vast majority of Americans.

Social Security relies heavily on people known as actuaries, who calculate the projected income and expenses of the all the Social Security programs and in theory provide guidance to Congress, allowing it to make funding decisions based on these projections. Unsurprisingly, it is important that these projections are accurate, given the millions who depend every month on receipt of their Social Security check.

A recent study by some researchers suggests that the actuaries at SSA have been overly optimistic in the long-term. This is problematic, as it could mean that the trust funds that support the Old Age and Survivors Insurance (OASI) and Social Security Disability Insurance (SSDI), could run out of money earlier than projected.

In reality, projections 75 years in the future are of little import. These "problems" are really a sideshow to distract from what Congress needs to do. The issue of funding these programs could easily be solved this session of Congress.

Simple changes, such as increasing slightly the tax rate and expanding the income ceilings would go a long way to "fix" all of the risk of Social Security running short of money. These changes are not difficult, so the question becomes why won't Congress act?

Source:, "Social Security May Be in Worse Shape Than We Thought: Study," Tom Anderson, May 8, 2015

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