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Good News about Social Security

Money Matters


presented by: Vision Financial

Many Millennials and GenXers have the notion that Social Security won’t be around by the time they retire. Well there’s good news…sort of.

The Trustees Report of the Social Security Trust Funds reported on April 22, 2019 the financial condition and the challenges faced by the Social Security program. The report states that in 2020, Social Security’s total costs, i.e. benefits and administrative expenses will exceed the taxes collected for the first time. Fear not for a reduction in benefits until 2034 when the Trustees Report projects that existing Trust Fund reserves will be depleted and benefits would face a reduction to 80% of present levels. The benefit levels gradually decrease to 75% by 2093. There is a silver lining to this news in that benefits are projected to decrease but not go away. Good news for the aforementioned Millennials and GenXers. Stated another way, with just current payroll tax revenue alone, these benefits can still be paid at those levels according to the Trustees Report.

Nobody wants to see a reduction in any benefit which they worked hard and paid into during their working careers. So, what are the solutions? There are several. They will be minimal in a practical standpoint but politically hot potatoes tossed around until political backs are against walls.

  • Raising the current Social Security Tax rate from its current 12.40% to 15.1%. If delayed until 2034, the increase would need to be 16.05%. There is the cost of waiting to implement an increase by Congress.
  • Raising or eliminating the ceiling on taxable wages, currently capped at $132,900 in 2019.
  • Raising the full retirement age beyond the current age of 67 (those born in 1960 and later).
  • Reducing future benefits. If implemented immediately, scheduled benefits could be reduced by 17% or by 20 % if applied to benefit applications moving forward.
  • Changing the benefit formula and the way annual cost-of-living adjustments are calculated.

In the final analysis, some changes (and yes increases to taxes) will be necessary to maintain benefits at present and future levels. The sooner some of those changes are implemented, the better and perhaps less onerous. The fact does remain, that even if nothing is done and benefits in the future are reduced, the real good news is they will still be there for Millennials, GenXers and those who come after. The full report from the Social Security Trustees can be accessed at

-Larry Anderson

Vision Financial Group

4505 Pine Tree Circle, Birmingham, AL 35243


Advisory services offered through Investment Advisors, a Registered Investment Advisor and a division of ProEquities, Inc. Securities are offered through ProEquities, Inc., a Registered Broker Dealer and Member FINRA & SIPC. Vision Financial Group is Independent of ProEquities, Inc. Securities and insurance products offered are not bank deposits, have no guarantee, are not FDIC insured and may lose value. 2019 Broadride Investor Communication Solutions, Inc. All rights reserved.

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