2018 Trustees Reports Available

Jun 8, 2018 / Amanda Chase, Horsesmouth Assistant Editor

The big news this week was the release of the 2018 Trustees Reports for both Social Security and Medicare. News articles ran the gamut from proclaiming that the programs are “broken” to arguing that the report shows Social Security is “stable” and should even be expanded.

You can find a detailed summary here. The main takeaways are:

  • The combined Social Security trust funds (Old-Age and Survivors Insurance and Disability Insurance) will be depleted in 2034, the same year projected in last year’s report.
  • Average benefit levels for disabled-worker beneficiaries were lower than expected in 2017, and are expected to be lower in the future. Disability applications have been declining steadily since 2010.
  • Social Security’s total cost is projected to exceed its total income (including interest) in 2018 for the first time since 1982, and to remain higher throughout the projection period.
  • The HI Trust Fund (Medicare Part A) will be depleted in 2026, three years earlier than projected in last year’s report. At that time dedicated revenues will be sufficient to pay 91 percent of HI costs.
  • Both Part B and Part D will remain adequately financed into the indefinite future because current law provides financing from general revenues and beneficiary premiums each year to meet the next year’s expected costs.

Your clients will likely pay attention to negative media attention and panic. Assure them that Social Security will have to change, but it won’t go away entirely, and not likely in the next 5-10 years. Use this as a good opening for further retirement income planning.

 

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