The Coming Crisis In Funding Retirement Benefits
Apr 25th, 2020 | By Dr. Jim Eckman
Baby boomers (those born between 1946 and 1964) are retiring in record numbers and are living longer. Because high-income workers have experienced faster wage growth than the rest of the population, a greater share of US wages is now exempt from the payroll tax, which stops at $132,900. Result? A smaller tax base to fund Social Security benefits. Thus, Social Security costs are projected to exceed income next year for the first time since 1982, forcing the program to dip into its nearly $3 trillion trust fund, built up when payroll taxes exceeded benefits.