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April 27, 2023 at 12:36 PM
Social Security is your clients’ retirement income stabilizer, a frenemy for any annuities or life insurance-based income solutions you offer, and a pillar of the U.S. economic system.
Actuaries — people who have shown they know the math and models needed to make sense of life insurance, annuities, pensions and other arrangements tied, at least partly, to forms of risk other than investment risk — talked about how they see the enormous retirement income and disability insurance program earlier this week, during a webinar organized by the American Academy of Actuaries’ Pension Practice Council.
The speakers were Karen Glenn, deputy chief actuary at the Social Security Administration’s Office of the Chief Actuary, and Stephen Goss, the chief actuary. Glenn and Goss emphasized that they spoke only for themselves, not for the SSA.
In 2022, Social Security provided an average of about $1,600 in retirement income per month for 57 million retirees, dependents and survivors, and $1,300 in disability income per month for 9 million disabled workers and dependents, according to the latest Social Security trustees report.
Payroll taxes fund the program. The program took in about $950 billion in retirement income program payroll taxes in 2022 and about $161 billion in disability insurance program payroll tax revenue. The two programs ended the year with $2.8 trillion in reserves accumulated years when payroll tax revenue was higher than benefits spending.
The retirement income trust fund is set to empty out in 2033. The trustees expect the disability insurance trust fund to stay solvent for the next 75 years.
For five other takeaways Glenn and Goss see when they look at Social Security’s finances — beyond the idea that Congress ought to do something about the 2033 depletion date — see the gallery above.
(Image: Adobe Stock)
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