Frustrated With the Idea of Social Security Cuts? I Am, Too
If you've heard the rumors that Social Security is in the process of going broke, the good news is that's not what's happening. Social Security is most certainly facing some financial challenges. In the coming years, it expects to owe more money in benefits than it collects in revenue.
The reason for this is that Social Security's main source of revenue is the payroll taxes workers fork over on their earnings. But now that baby boomers are staging a mass workforce exodus, that revenue stream is shrinking. To make matters worse, in the coming years, boomers will no doubt be filing for Social Security benefits because, well, they're entitled to them.
Now Social Security can tap its trust funds for a number of years to keep up with scheduled benefits. But once those funds run out of money, which is expected to happen in a little more than a decade, benefit cuts will be on the table.
Source Fool.com
