Social Security’s Financial Outlook: The 2014 Update in Perspective

Source: Alicia H. Munnell, enter for Retirement Research at Boston College, Issue Brief, IB#14-12, July 2014

The brief’s key findings are:
∙ The 2014 Trustees Report shows little change from last year:
∙ Social Security’s 75-year deficit rose modestly to 2.88 percent of payroll.
∙ But the deficit as a percent of GDP is still 1 percent.
∙ And trust fund exhaustion is still 2033, after which payroll taxes still cover about three quarters of promised benefits.
∙ The shortfall is manageable but, with the deficit rising to about 4 percent in two decades, action should be taken soon to avoid larger tax/benefit changes later.
∙ And the disability insurance program needs immediate attention, as its trust fund is expected to be exhausted in 2016.