Do you remember getting your first paycheck? Along with the thrill of finally making money, you may have noticed a deduction or two from your earnings. One of those deductions was the Social Security tax, which pays into a fund for retirement and disability benefits. It’s easy to think that the money you put into Social Security is safely tucked away in a vault somewhere, but that’s not entirely true.
How the Government Borrows From Social Security
In fact, the Federal government can and does borrow from the Social Security trust fund. It’s a little-known fact, but it’s true—the government uses these funds to pay its bills. That means the money you put into Social Security is being used to help fund other government programs, such as defense and infrastructure.
However, one part of the equation is often left out: while the government can borrow from Social Security, it also has a responsibility to pay back those funds—with interest. This can serve as a source of protection for the trust fund, as it ensures that there will always be money available to pay out benefits.
Yet despite this protection, some worry that the government’s borrowing could have a negative impact on their Social Security benefits. And it’s clear that Social Security is in need of help—estimates put the date of Social Security insolvency (when the trust fund will run out) at 2033—just a decade off.
The Seniors Center’s Plan to Fix Social Security Solvency
The Seniors Center believes it’s important to protect this trust fund and ensure that benefits are paid out for generations to come. We have proposed a plan that would address Social Security solvency issues and ensure sustainable benefits for the future.