Social Security Is in Financial Trouble

  • In 1940: 
    • Two percent of each worker’s paycheck was collected.
    • About 159 workers per each retiree.
  • Today: 
    • Fewer than three workers per retiree.
    • 12.4 percent payroll tax is levied on workers’ paychecks. 
    • Social Security is the largest tax most workers’ pay, and it still falls short.

If No Changes Are Made

  • Due to budget shortfall, all benefits will be reduced by about 25 percent in 2034.
  • Young workers could face tax increases: Current benefits come from today’s workers. Future benefits must be funded by future taxpayers.
  • Less federal money to spend on other priorities, from the environment to national security.

Policymakers Can Create a Better, Fairer System

  • Offer more flexibility: Provide earned family leave for new parents.
  • Implement reforms: Consider adjustments in the retirement age.
  • Encourage work and savings: Make it easier for companies to help all workers better save for retirement.
  • Ensure the program fulfills its mission: SocialSecurity was created to protect “against poverty-ridden old age.”

Policymakers have the opportunity—and the responsibility—to create a legacy of a better economy and greater retirement security by modernizing Social Security. Read more here.