More than 58.7 million Americans look forward to receiving Social Security checks each month. The average monthly check is $1,072.
Where does the money come from? There is a payroll tax on employers and employees during our people’s working years.
This Friday, officials will look at the Consumer Price Index for July, August and September to see the effects of inflation, to determine if there is justification for an upward adjustment in the Social Security payments.
For many years, there has been inflation, resulting in larger Social Security checks. But when officials of the Bureau of Labor Statistics look at the economic facts this year, it is expected they will find no justification for any Social Security “cost-of-living” increase in 2011.
While that will be disappointing to many, we all should be more concerned about the future.
There is the troubling fact that U.S. Treasury Notes accumulated in past “surplus” years for future Social Security payments are expected to run out in the late 2040s or 2050s.
Many people may think, “Well, I’ll be gone by then, so why should I worry?” But millions of Americans will still be here then – expecting Social Security checks – when the money is gone. So that should be a concern for our children, grandchildren and us all.
How could the deficit prospects be covered? Will there be an increase in the retirement age? Will Social Security or other taxes be raised? Will there have to be more government borrowing, adding to the national debt? Will Social Security benefits have to be cut? Or …?
While it is not pleasant to think about these things today, it will be much worse than unpleasant in the near future if we do not face the financial facts before very negative effects are thrust upon us with no solution in sight.