When will Social Security and Medicare funds run out, according to experts?
Funds supporting Social Security and Medicare will run out within years and Americans may not get their full benefits unless Congress takes action.
The Treasury Department has released figures from the annual trustees report of Social Security and Medicare, and there were small improvements in the programs’ financial status.
The office says the country’s better-than-expected economic performance boosted the programs’ financial outlook. However, if policymakers do not implement changes, both Social Security and Medicare will deplete their funds in just over a decade.
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When will Social Security funds run out?
Officials say that Social Security is likely to exhaust the Old-Age and Survivors Insurance (OASI) Trust Fund reserves and run out of money to pay beneficiaries in full in 2033, unchanged from last year’s report. However, the Disability Insurance (DI) Trust Fund is projected to be able to pay 100% of total scheduled benefits through at least 2098.
If the OASI Trust Fund and DI Trust Fund projections were to be combined, the resulting projected fund (called OASDI) would be able to pay 100 % of total scheduled benefits until 2035, one year later than reported last year.
The Social Security Administration expects the program’s trust funds to be used up if no changes are made to address the funding shortfall. This could result in a reduction in benefits for future retirees unless Congress takes action to shore up the program’s finances. If the House does not act, continuing taxes will only be able to pay for approximately 79% of scheduled Social Security benefits.
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When will Medicare funds run out?
Meanwhile, the economy also helped boost the financial health of Medicare, and the expected life span of its reserves has been given an extension of five years.
According to the trustees’ latest estimates, the funds will run out by 2036, compared to last year’s 2031 projection. However, without a new law from Congress, Medicare will only be able to afford to pay 89% of scheduled benefits at that time.