2017 OASDI Trustees Report

[USGrant1962]

The newest SS trustees report is out: https://www.ssa.gov/oact/TR/2017/index.html

This summary says that to maintain solvency cuts could range from 23% in 2034 growing to 27% in 2091. https://finance.yahoo.com/news/soci...-17-years-unless-congress-acts-175058898.html Though I don't see those actual estimates in the trustees report summary.

It's all good - I've been using a 30% haircut in my estimates and I'll start collecting before 2034.

 

[Senator]

The newest SS trustees report is out: https://www.ssa.gov/oact/TR/2017/index.html

This summary says that to maintain solvency cuts could range from 23% in 2034 growing to 27% in 2091. https://finance.yahoo.com/news/soci...-17-years-unless-congress-acts-175058898.html Though I don't see those actual estimates in the trustees report summary.

It's all good - I've been using a 30% haircut in my estimates and I'll start collecting before 2034.

I would rather no cut until 2050 or so, then 100% cut....

 

[donheff]

It's all good - I've been using a 30% haircut in my estimates and I'll start collecting before 2034.

Based on current law (the debt ceiling) US treasuries will default or would need to take a substantial haircut imminently. Yet we don't lose sleep that this will happen even though the idiots on the Hill are more likely to precipitate a crisis on the ceiling than on SS. So why discount anticipated SS by the current shortfall? It could continue to pay out as planned, be cut 25%, payout more, be completely completely abolished, or be reduced by some different factor. I would guess it might be tinkered with (e.g. chained CPI) but not much more. But in reality, who knows?

 

[Bigdawg]

I would rather no cut until 2050 or so, then 100% cut....

2055 just to be safe. I won't see 91.

 

[Red Badger]

Based on current law (the debt ceiling) US treasuries will default or would need to take a substantial haircut imminently. Yet we don't lose sleep that this will happen even though the idiots on the Hill are more likely to precipitate a crisis on the ceiling than on SS. So why discount anticipated SS by the current shortfall? It could continue to pay out as planned, be cut 25%, payout more, be completely completely abolished, or be reduced by some different factor. I would guess it might be tinkered with (e.g. chained CPI) but not much more. But in reality, who knows?

While I plan for the potential haircut, I believe it to be very unlikely. Unlike the debt /debt ceiling crisis (which is unfortunately, at best, abstract to most Americans), SSI is very concrete to recipients and near recipients. These folks are the ones who show up for elections, including primaries, off season, special etc. And politicians fears one thing and one thing only - losing their seat at the trough. So, I suspect we'll come out okay, but only due to the greed and self-interest of our "public servants."

 

[Ready]

I don't see SS being cut. There's plenty of time to fix things and the fixes are not all that difficult. But the US Government is not going to let down the millions of people who put money into the system and will need to rely on it to have a secure retirement.

It would be nice if they addressed it now rather than waiting until the last minute. But history tells us that our government is great at procrastinating, but when their backs are against the wall they figure out a solution, or at least a way to kick the can down the road.

 

[USGrant1962]

So why discount anticipated SS by the current shortfall? It could continue to pay out as planned, be cut 25%, payout more, be completely completely abolished, or be reduced by some different factor.

I discount mostly because I can, it's one of a number of conservative assumptions when I run FIRECalc and other forecasts. I don't think elimination is realistic so I don't ignore it (many here do), but some tinkering is likely. Maybe they will fiddle with CPI plus fiddle with SS taxation plus fiddle with means testing? Who knows?

Also as a married couple it kind of splits the difference should one of us pass away early.

Discounting also accounts for the ER aspect where your SS statement assumes you keep working until you collect. The math I've seen makes for only a small discount, but I consider it part of the 30%.

 

[eastnortheast]

I guess I am like others here - use ~ 1/3 reduction in SS for retirement planning, but I really don't think that this will happen.

People who collect SS vote in higher percentages than almost any other age group.