How Much Could Fixing Social Security Cost You?
Summary
Social Security’s current funding is expected to run out by 2032, meaning it would only be able to pay about 78% of promised benefits unless changes are made. Lawmakers are considering options such as raising payroll taxes or removing the income cap on taxable wages to close this funding gap.Key Facts
- The Social Security trust fund will run out of reserves by 2032.
- After 2032, Social Security could only pay about 78% of scheduled benefits without changes.
- Payroll taxes are currently 6.2% for workers and 6.2% for employers, applied to earnings up to $184,500 in 2026.
- To fix the gap by raising taxes, workers’ payroll tax rates might increase to between 8.3% and 8.7%.
- For example, a worker earning $50,000 might pay $1,100 to $1,200 more per year in Social Security taxes.
- Some lawmakers propose removing or raising the $184,500 income cap so that higher earners pay Social Security taxes on more of their income.
- About 71 million people receive Social Security benefits, including retirees, survivors, and disabled workers.
- The program has paid out more in benefits than it has received in income since 2021.
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