Social Security

Topic Proposal: Social Security

Ever since I received my very first pay check, I remember being told multiple times by my parents, relatives, teachers, and coworkers that I would be lucky if Social Security was even around by the time I am eligible to collect it. Seeing that I was only sixteen at the time, I really did not think much of what they were saying and I just politely listened. Now that I have grown older, I am fully aware of Social Security’s long-term financial problems in the United States today and exactly just how they will affect me and others someday.

Surprisingly, when I took it upon myself to discuss Social Security with a few individuals, some of them did not even know quite what it even was. Just to make everything clear, Social Security is a program of old-age, unemployment, health disability, and survivors insurance maintained by the U.S. federal government though required payment by specific employer and employee groups. (Dictionary.com LLC)

So, what’s the problem with it? Social Security’s dilemma is that it is becoming insolvent. What exactly triggered this predicament stems a number of causes. First off, over time and ever since Social Security was created in 1935, demographics have gradually changed. The life expectancy of Americans has increased and the ratio of workers to those in retirement has dropped. Statistics show that in 1940, there were 42 workers per retiree. In 1950, the ratio was 16-to-1. In 2010, there were 2.8 workers per retiree, and within 40 years, it’s projected that there will be just two workers per retiree. Essentially, this means that the money flowing in will eventually not be enough to support the money going out. (Financial Planning Association) (Prudential)

As an attempt to fix future problems, in 1983, a Social Security Trust Fund was created, with the intention of using surplus payroll tax revenue to underwrite shortfalls for Social Security’s future needs. The funds were supposed to be invested in a...