The Social Security Board of Trustees has released its annual report on the long-term financial status of Social Security Trust Funds.
The findings from the “2020 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds” show comparable numbers to last year’s report. It suggests combined asset reserves of the Old-Age and Survivors Insurance and Disability Insurance (OASI and DI) are projected to be depleted in 2035, with 79% of benefits payable. Separately, the OASI Trust is said to be exhausted a year earlier in 2034, with 76% of benefits payable. The DI Trust Fund is estimated to deplete in 2065, with 92% of payable benefits.
The board says that while these estimates are current, they do not reflect potential outcomes following the COVID-19 pandemic. “The projections in this year’s report do not reflect the potential effects of the COVID-19 pandemic on the Social Security program. Given the uncertainty associated with these impacts, the trustees believe it is not possible to adjust estimates accurately at this time,” says Andrew Saul, commissioner of Social Security. “The duration and severity of the pandemic will affect the estimates presented in this year’s report and the financial status of the program, particularly in the short term.”
Other findings show Social Security paid a total benefits amount of $1.048 trillion during 2019. There were about 64 million beneficiaries at the end of the calendar year, and an estimated 178 million people had earnings covered by Social Security and paid payroll taxes, according to the report.
Total income, including interest, to the combined OASI and DI Trust Funds amounted to $1.062 trillion in 2019. The Social Security Board of Trustees says $944.5 billion of this amount was from net payroll tax contributions, $36.5 billion was from taxation of benefits and there was $81 billion in interest. Total expenditures from both funds amounted to $1.059 trillion, and asset reserves increased by $2.5 billion, for a total of $2.897 trillion.
The board announced its total annual cost of the program is projected to exceed total annual income in 2021—the first time since 1982— and remain higher throughout the 75-year projection period. As a result, asset reserves are expected to decline during 2021. Social Security’s cost has exceeded its non-interest income since 2010.
More findings from the 2020 report can be found here.