00:00The federal government allocated a staggering $1.5 trillion to Social Security in fiscal year
00:052024, representing 22.4% of the total federal budget. This vital program, managed by the
00:13Social Security Administration, offers crucial financial support to millions of Americans,
00:17from retirees and individuals with disabilities to survivors of lost loved ones.
00:22The vast majority of this spending, 86%, or $1.3 trillion, was dedicated to retirement benefits.
00:30With disability benefits accounting for 11% and other benefits making up 4%.
00:35As of December 2024, Social Security served a massive demographic, nearly 90% of individuals
00:41aged 65 and older were enrolled, totaling 68.5 million people. This included 51.8 million
00:49retired workers and their dependents, 7.2 million disabled workers and their families, and 5.8
00:55million survivors. The SSA projects this number will climb to nearly 69 million monthly
01:01beneficiaries in 2025. In December 2024 alone, the SSA distributed $104.7 billion in retirement
01:10benefits, with an average monthly payout of $1,975. Disability recipients and their dependents
01:17received $11.9 billion, averaging $1,581, while survivors were granted $8.9 billion, averaging $1,546.
01:29It's important to note that beneficiaries do pay taxes on their Social Security income.
01:34But how is this colossal program funded? Social Security relies on the Old Age and Survivors'
01:40Insurance and Disability Insurance Trust funds, which held a combined $2.7 trillion at the close of 2024.
01:47These funds are primarily fueled by payroll taxes paid by U.S. workers and matched by their
01:53employers. Self-employed individuals contribute at twice the rate, covering both employee and employer
01:59portions. In 2024, workers contributed an estimated $1.3 trillion to these trust funds. Additional revenue
02:08came from income taxes on benefits, totaling $55 billion, and $69 billion in interest. The critical
02:16question now looms, is Social Security sustainable? The trust funds have faced a deficit annually from
02:222021 to 2024, a stark contrast to the surpluses seen every year from 1982 to 2020. In 2024, the funds took
02:32in $1.42 trillion but spent $1.48 trillion, leading to a record depletion of $67 billion. Since its peak
02:41in 2020, the overall value of the trust funds has plummeted by $187 billion, or 6.4%. The SSA
02:49alarmingly projects that these vital trust funds could be entirely depleted by 2034, unless Congress
02:55intervenes. This raises urgent questions about the future of a program that millions of Americans
03:01depend on for their financial security. Money Explainers
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