Social Security is facing a considerable funding challenge, primarily due to the increasing number of baby boomers retiring. While the rumor of the program going bankrupt is exaggerated, the Social Security Trustees predict that, by 2035, its trust funds will be depleted, necessitating potential benefit cuts of around 20%. The exact timing and extent of these cuts may fluctuate based on various factors, including revenue generated from payroll taxes and potential changes in government policy, urging individuals to consider consulting financial advisors for retirement planning.
Right now, those cuts are estimated somewhere in the ballpark of 20%. But that number could change in the coming years, for better or worse.
The Social Security Trustees put out a report every year that offers an update on the state of the program's finances.
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