Where does your Social Security pension fit into your retirement plan? That might depend on your age and your view on the program’s long-term prognosis.The annual trustee reports on Social Security and Medicare were released earlier today and showed little change from last year’s report. Depending on your perspective, that is either good or bad. The bottom line is that the estimated insolvency date of Social Security’s big trust fund is 2034, which is unchanged from last year. The other big fund is Medicare’s hospital trust fund. Last year, it was projected to run out of funds in 2028. That date has been updated to 2029 in this year’s report.
As most are aware – or should be – both funds are paid for by wage earners out of their Social Security payroll taxes. What the insolvency dates mean is that payroll taxes will be the only source of benefit payments once the trust fund reserves are gone.
The Social Security report also projected that the program’s 2018 cost of living adjustment (COLA) would be 2.2 percent, the largest in several years. The COLA establishes annual … Read the Summary