Social Security could suffer serious reductions in the United States: this would be the implementation date

Social Security in the United States, one of the social programs with the highest number of beneficiaries in the North American country thanks to its diverse support, could be affected in less than 8 years due to the reduction of the Social Security trust fund. 

According to a recent report by the Congressional Budget Office (CBO), this budget could be depleted by the fiscal year corresponding to 2033. 

This would result in a significant decrease in the payments that millions of beneficiaries receive monthly. Similarly, this reduction would impact the lives of retirees, people with disabilities, and others enrolled in the various benefits of Social Security. 

What is the reason for the reduction of Social Security in the United States? 

The reason why the Social Security trust fund could be affected is rooted in a marked disparity between revenue and subsidy caused by the growing financial deficit. 

According to experts, this phenomenon has gained strength because the program pays out more in benefits than it collects. In addition, the reduction in mortality rate and immigration would have a direct effect on active workers contributing to the Social Security fund in the United States. 

Although it is unlikely that Social Security could disappear entirely, the annual adjustment for cost of living (COLA), as well as future benefits, will become completely unsustainable compared to how they are currently delivered. In addition, the growing national debt, which amounts to 28 trillion dollars, could exacerbate the crisis on these types of programs. 

According to the CBO's long-term analysis chief, Molly Dahl, during an appearance before the Senate Budget Committee, the absence of a plan on Social Security payments could start experiencing cuts of up to 25% from 2034 onwards. 

However, only by combining Disability and Retirement Insurance, two of the most important programs, could the date be postponed until 2035. 

The solution to "rescue" Social Security in the United States

According to experts in the field, there are two ways to solve this problem: increase taxes and reduce public spending. Regarding the first option, lawmakers have proposed raising taxes for individuals earning more than $400,000 annually. 

Others have suggested that the retirement age could be increased. In response to this option, this sector has also been encouraged to seek economic alternatives such as investing in high-yield savings accounts, reducing expenses, seeking passive income options, among others. 

*This article has been automatically translated using artificial intelligence