The annual report released by the Social Security Board of Trustees examining the financial health of the Social Security Trust Funds outlines a stable long-range outlook. The combined assets of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds will be exhausted in 2037, the same as projected last year and the report estimates that in 2037 there will be sufficient tax revenue coming in to pay about 78 percent of benefits. The report projects that program costs will exceed tax revenues in 2010 and 2011 as a result of the economic downturn.
Highlights from the report include:
- The assets of the combined OASDI Trust Funds increased by about $122 billion in 2009 to a total of $2.5 trillion.
- During 2009, an estimated 156 million people had earnings covered by Social Security and paid payroll taxes.
- Social Security paid benefits of $675 billion in calendar year 2009. There were about 53 million beneficiaries at the end of the calendar year.
- The cost of $6.2 billion to administer the program in 2009 was a very low 0.9 percent of total expenditures.
- The combined Trust Fund assets earned interest at an effective annual rate of 4.9 percent in 2009.
- The projected actuarial deficit over the 75-year long-range period is 1.92 percent of taxable payroll — 0.08 percentage point smaller than in last year’s report.
- Over the 75-year period, the Trust Funds would require additional revenue equivalent to $5.4 trillion in present value dollars to pay all scheduled benefits.
“The impact of the current economic downturn continues to be felt by the Social Security Trust Funds,” said Michael J. Astrue, Commissioner of Social Security. “The fact that the costs for the program will likely exceed tax revenue this year is not a cause for panic but it does send a strong message that it’s time for us to make the tough choices that we know we need to make. I applaud President Obama for his creation of the Deficit Commission so we can start the national discussion needed to ensure that Social Security remains a foundation of economic security for our children and grandchildren.”