Social Security: I Knew I Was Screwed, But What About My Parents?
I'm 37. I made peace with the fact there would be no Social Security payments for me when I retired a long, long time ago. But I never thought about it running out on my parents, who -- unlike me -- didn't realize how screwed they were during their "prime earning years." (cough -- raise your hand if your family nets the same now as you did in 2000)
According to ABC News:
Medicare's Hospital Insurance Fund is projected to exhaust its funds in 2024, five years sooner than last year's estimate, and Social Security will be exhausted in 2036, a year earlier than previously thought, the trustees announced.
That is 13 years from now. I'll still be almost twenty years from retirement, and my parents will most likely still be living. With no money from Social Security?
The plot gets thicker, as it always does when you're talking government and budgets. It seems like no matter who is in office, the actual amount of money we have is immaterial to what we will spend -- to the point it's impossible to understand if we're really in trouble or not.
A few paragraphs later in the ABC story, it seemed all was not lost:
The funds won't go totally bankrupt by the years the trustees projected they would be exhausted, but the programs will no longer be able to pay full benefits. Social Security would pay out roughly 75 percent of benefits through 2085, Medicare 90 percent in 2024.
I didn't actually realize that this all happened in the '80s, too, sort of. According to Wikipedia:
These two developments were decreasing the Social Security Trust Fund reserves. In 1982, projections indicated that the Social Security Trust Fund would run out of money by 1983, and there was talk of the system being unable to pay benefits. The National Commission on Social Security Reform, chaired by Alan Greenspan, was created to address the crisis.
Everything I'm reading in mainstream media shows Democrats and Republicans arguing over how to solve the problem -- everything from containing health care costs to raising taxes to cuts to current beneficiaries without affecting new enrollees.
What do you think? Do you have Social-Security-is-going-to-run-out fatigue? Have you changed your saving habits knowing this is coming, whether it's five years earlier or not? Are you worried about older relatives? Are you in retirement yourself? I'd love to hear from you in the comments.
And please leave links to bloggers writing about this, because I had a really hard time finding BlogHers.