The Social Security retirement trust fund runs dry in the fourth quarter of 2032. Trustees say a 22% across-the-board cut follows. The Congressional Budget Office says mid-2032 and 26%. Even the doom has a range.
The Committee for a Responsible Federal Budget did the math on a 24% cut. Average damage: $500 a month. In 29 states, it's worse.
Congress has six years. It also has a famous plan. The plan is to wait.
CNBC says lawmakers may act sooner or "kick the can down the road." Pick one. Congress has never once picked the first one.
Here is the full legislative strategy, as I understand it. Step one: hold a hearing. Step two: describe the hearing as "productive." Step three: 2032.
Merge the retirement and disability funds, and the date slides to the third quarter of 2034. The cut shrinks to 17%. That's Congress's idea of a fix: move the hole to a different part of the yard.
Now the retail traders. You'll see them on message boards, pricing in a 22% haircut to their grandmother. They'll call it "a catalyst." They'll buy calls on it. The calls expire Friday. The trust fund expires in 2032. Both are out of money. Only one of them got a hearing.
Retirees will not stop getting checks. Payroll taxes still cover most of the benefit. Just not all of it. Like a restaurant that serves most of your steak.
Commissioner Frank Bisignano says lawmakers and the Social Security Administration must "work together." Two groups. One deadline. Zero evidence of a calendar.
My advice: ignore the headline, ignore the chart, ignore the trustees. Trust the one institution that has never missed a deadline for doing nothing.
Your retirement plan is a 22% pay cut and a congressman's word. Pray for the pay cut.
Photo by Dileesh Kumar on Unsplash
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