00:00The Social Security Program, a lifeline for millions of Americans, faces a looming crisis.
00:06According to a recent report by the program's trustees, the Social Security Trust Fund is now
00:11expected to run out of cash in just eight years. Unless Congress acts before then, benefits for
00:16over 60 million retirees and family members will face an automatic cut of 23%. This deadline is
00:23about nine months earlier than predictions from a year ago. This accelerated timeline is primarily
00:29due to a new law that increased benefits for nearly 3 million former public sector workers
00:33whose pensions were not covered by Social Security. Additionally, trustees have adjusted their
00:39assumptions about future wages, which directly impact payroll tax contributions, and birth rates,
00:44further exacerbating the financial shortfall. A separate trust fund, which supports Social
00:50Security disability payments, is currently projected to remain solvent through 2099. However, if the
00:57two funds were combined, an action that would require an act of Congress, the pooled fund would
01:02only last through 2034. After that, benefits would still face an automatic cut, albeit a slightly smaller
01:09one of 19%. The program's most fundamental challenge remains demographic. The U.S. population is rapidly
01:17aging, with more than 11,000 baby boomers reaching retirement age every single day. This means that for
01:24each person currently drawing Social Security, there are now fewer young workers contributing taxes to
01:29support the system. While the trust fund built up over decades when baby boomers were in their working
01:34years provides a temporary buffer once that money is gone incoming payroll taxes will only be sufficient
01:40to cover approximately 77% of promised retirement benefits. The implications are clear, Congress must act.
01:48Lawmakers have a range of options to address this shortfall, including raising taxes, cutting benefits,
01:53or implementing a combination of both. The trustees have emphasized the urgency of the situation,
01:59stating that taking action sooner rather than later will allow consideration of a broader range of
02:04solutions, and provide more time to phase in changes so that the public has adequate time to prepare.
02:10Maya Mac Guinness, who leads the Committee for a Responsible Federal Budget, has strongly warned against
02:15further delay, asserting that at this point, any member of Congress without a plan to fix Social Security
02:21is shirking their duty to preserve the nation's largest and most important government program.
02:26While President Trump has vowed not to touch Social Security benefits, the law dictates an automatic
02:31benefit cut if no changes are made to the program and the trust fund is exhausted. Nancy Altman,
02:38president of the advocacy group Social Security Works, points out, any politician who doesn't support
02:43increasing Social Security's revenue is, by default, supporting benefit cuts.
02:47The future of Social Security hangs in the balance, requiring decisive action from Congress to avoid a
02:54significant impact on millions of Americans. Money Explainers
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