Retirement Weekly: Assessing the true Social Security crisis

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Is Social Security in a crisis?

The arguments in favor of a “yes” answer are widely known, of course. Starting next year, the Social Security Administration will be paying out more in benefits than what is paid into the system. These yearly deficits will gradually eat away at the system’s large current reserves, and those reserves are projected to be completely depleted by 2034. At that point recipients will only receive around 80 cents per dollar they otherwise would be owed.

Making this already-dire situation even worse, according to some: The Social Security system’s large current reserves don’t really exist. That’s because, they argue, those reserves were deposited with the U.S. Treasury, where the money has long since been spent.

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