Most Americans Over 50 Worry Social Security Will Run Dry In Their Lifetime

A Social Security card sits alongside checks from the U.S. Treasury in Washington on Oct. 14, 2021. Kevin Dietsch/Getty Images

With the issue of Social Security expected to be a big issue in the 2024 presidential election, a new survey shows that the vast majority of Americans aged 50 and over are worried that Social Security will run out of money within their lifetime.

Ten years ago, 66 percent of U.S. adults above the age of 50 worried that Social Security would run dry within their lifetime, according to the Nationwide Retirement Institute, which has been polling Americans annually about their perceptions of and concerns about the Social Security system.

Today, that figure is significantly higher, with a whopping 75 percent saying they’re concerned that Social Security will run out of funds within their lifetime, according to the latest 2023 edition of the survey (pdf).

The increased worry about the state of the Social Security fund is eclipsed by the growth in the share of adults aged 50 and above who say they have no source of retirement income aside from Social Security.

Just over one in five (21 percent) said all they have to count on for retirement is Social Security, up sharply from 13 percent in 2014.

Ten years ago, 48 percent of Americans had a pension in addition to Social Security. In 2023, that number has dwindled to just 31 percent.

Social Security Fund In Danger

Social Security is facing future challenges due to various factors such as inflation and lower-than-expected tax revenue.

A recent projection by the nonpartisan Committee for a Responsible Federal Budget (CRFB) estimates that the Social Security trust fund, which consists of two smaller funds—the Old-Age and Survivors Insurance (OASI) trust fund and the Disability Insurance (DI) trust fund will be insolvent in 2033.

“Upon insolvency, the law mandates that the OASI trust fund can only spend in amounts equal to incoming trust fund revenue, which means that all 70 million retirees, dependents, and survivors—regardless of age, income, or need—will see their benefits cut by 23 percent,” the analysis states.

This means that, in 2033, annual benefits for the average newly retired dual-income couple would be cut by over $17,000.

“For a typical dual-income couple retiring in 2033, we estimate this would represent an immediate $17,400 cut in current dollar annual benefits and an immediate $13,100 cut for a typical single-income couple,” the analysis states.

The CRFB analysis also says that any 2024 presidential candidate who promises not to touch Social Security is “implicitly endorsing a 23 percent across-the-board benefit cut” for some 70 million retirees when the fund runs out of money within 10 years.

‘65 Is Way Too Low’

The future of Social Security has become a key political talking point as the 2024 presidential campaign heats up.

Former President Donald Trump has warned his fellow Republicans not to cut Social Security benefits, while President Joe Biden has vowed to push back against any GOP-led efforts to slash Social Security payments.

While the topic of Social Security didn’t get much attention during the recent Republican primary debate, one of the candidates, Nikki Haley, told Bloomberg in an interview the following day that her solution would be to raise the retirement age—and cut benefits.

“You’ve got multiple candidates on that stage that said they wouldn’t touch entitlements, including Trump, and any candidate that says they’re not going to touch entitlements means they’re basically going to go into office and then leave America bankrupt,” she said. remove

Ms. Haley referred to projections showing that Social Security will go bankrupt within a decade, while proposing a possible solution.

“We don’t touch anyone’s retirement or anyone who’s been promised in but we go to people like my kids in their twenties, when they’re coming into the system, and we say the rules have changed,” she said.

“We change retirement age to reflect life expectancy. Instead of cost-of-living increases, we do it based on inflation. We limit the benefits on the wealthy,” she continued.

Ms. Haley declined to specify a number when asked what retirement age she thinks is appropriate, saying only that this would need to be data-driven and that the current age of 65 is too low.

“I think we have to do the numbers, we’ve got to figure out what is, but what we do know is 65 is way too low, and we need to increase that,” she said.

Another Republican presidential hopeful, former New Jersey Gov. Chris Christie, recently put forward a similar idea, recommending changes to Social Security that would involve higher-earning Americans having their benefits cuts while exempting people aged 50 and older from any reforms.

Reagan-O'Neill Model

There have been other calls by lawmakers to come up with a fix to prevent Social Security from running dry.

Sen. Chuck Grassley (R-Iowa) said during a July 12 Senate Budget Committee hearing Congress should follow the example of President Ronald Reagan and House Speaker Tip O’Neill (D-Mass.) in the 1980s.

“When you have candidates for president on the Republican side, and you have a Democratic president in office today who say, ‘We’re not going to touch Social Security,’ how are you going to get things done?” Mr. Grassley asked.

“The only way to reach a deal on Social Security is to follow the Reagan–O'Neill model. That means Congress and the president working in a bipartisan fashion and keeping a chain, a range of options on the table,” Mr. Grassley said, referring to the 1983 agreement that stabilized Social Security for decades.

The Reagan-O'Neill model was basically a combination of increasing payroll taxes and gradually raising the retirement age.