Fast Facts & Figures About Social Security, 2015

FastFacts2015-2 The new Fast Facts & Figures About Social Security, 2015 booklet is now available.

I like this booklet. Perhaps you will too.

Issued annually, this short booklet answers frequently asked questions about the programs administered by the Social Security Administration (SSA). It highlights basic program data for the Social Security retirement, survivors, and disability (OASDI) and Supplemental Security Income (SSI) programs.

Tables and charts illustrate the range of program beneficiaries, from the country’s oldest to its youngest citizens. In all, about 64.2 million people received some type of Social Security benefit or SSI assistance in 2014.

Different topics are easily tabbed for your interest. All are worth your time. In particular, see the “Relative Importance of Social Security” chart in the “Income of the Aged Population” section.




Annual Trustees Report for 2015

Yesterday the Social Security Board of Trustees released its annual report for 2015 with the following news release.

The full 2015 Trustees Report is at


Wednesday, July 22, 2015 – For Immediate Release

Social Security Board of Trustees: Trust Fund Reserve Gains One Year for Projected Depletion Date 

The Social Security Board of Trustees today released its annual report on the long-term financial status of the Social Security Trust Funds. The combined asset reserves of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds are projected to become depleted in 2034, one year later than projected last year, with 79 percent of benefits payable at that time. The DI Trust Fund will become depleted in 2016, unchanged from last year’s estimate, with 81 percent of benefits still payable.

In the 2015 Annual Report to Congress, the Trustees announced:

  • The combined trust fund reserves are still growing and will continue to do so through 2019. Beginning with 2020, the cost of the program is projected to exceed income.
  • The projected point at which the combined trust fund reserves will become depleted, if Congress does not act before then, comes in 2034 – one year later than projected last year. At that time, there will be sufficient income coming in to pay 79 percent of scheduled benefits.
  • The projected actuarial deficit over the 75-year long-range period is 2.68 percent of taxable payroll — 0.20 percentage point smaller than in last year’s report.

While the projected depletion date of the combined OASDI trust funds gained a year, the Disability Insurance Trust Fund’s projected depletion year remains 2016. I agree with President Obama, we have to keep Social Security strong, protecting its future solvency. President Obama’s FY 2016 budget proposes to address this near-term Disability Insurance Trust Fund’s reserve depletion. By reallocating a portion of payroll taxes from Old Age Survivors to the Disability Trust Fund – as has been done many times in the past – would have no adverse effect on the solvency of the overall Social Security program,” said Carolyn W. Colvin, Acting Commissioner of Social Security.

We believe that Congress must take action to reallocate a portion of the payroll tax rate between the trust funds to avoid deep and abrupt cuts or delays in benefits for individuals with disabilities who paid into the system while they worked and now need the benefits they earned to support themselves and their families,” Colvin said.

Other highlights of the Trustees Report include:

  • Income including interest to the combined OASDI Trust Funds amounted to $884 billion in 2014. ($756 billion in net contributions, $30 billion from taxation of benefits, $98 billion in interest, and less than $1 billion in reimbursements from the General Fund of the Treasury—almost exclusively resulting from the 2012 payroll tax legislation)
  • Total expenditures from the combined OASDI Trust Funds amounted to $859 billion in 2014.
  • Non-interest income fell below program costs in 2010 for the first time since 1983. Program costs are projected to exceed non-interest income throughout the remainder of the 75-year period.
  • The asset reserves of the combined OASDI Trust Funds increased by $25 billion in 2014 to a total of $2.79 trillion.
  • During 2014, an estimated 166 million people had earnings covered by Social Security and paid payroll taxes.
  • Social Security paid benefits of $848 billion in calendar year 2014. There were about 59 million beneficiaries at the end of the calendar year.
  • The cost of $6.1 billion to administer the program in 2014 was a very low 0.7 percent of total expenditures.
  • The combined Trust Fund asset reserves earned interest at an effective annual rate of 3.6 percent in 2014.

The Board of Trustees comprises six members. Four serve by virtue of their positions with the federal government: Jacob J. Lew, Secretary of the Treasury and Managing Trustee; Carolyn W. Colvin, Acting Commissioner of Social Security; Sylvia M. Burwell, Secretary of Health and Human Services; and Thomas E. Perez, Secretary of Labor. The two public trustees are Charles P. Blahous, III and Robert D. Reischauer.

View the 2015 Trustees Report at




FRA and the SSA Amendments of 1983

Regular readers know that your full retirement age (FRA) is based on year of birth and ranges from age 65 for people born in 1937 or earlier, to age 67 for people born in 1960 and later. FRA is age 66 for people born in 1943 – 1954.

Full retirement age is the age at you can first become entitled to full or unreduced retirement benefits. Starting Social Security retirement when younger than FRA results in a reduced benefit amount. Starting retirement when older than FRA results in an increased amount.

While not that often anymore, I continue to meet people who are not aware that FRA varies and they usually ask when this came about. Learning that this change was part of the 1983 Social Security Amendments is a second surprise to them, especially when they realize that these FRA changes are still being phased in.

Why was full retirement age changed in 1983?

In the early 1980’s the Social Security program faced a serious short-term financing crisis. President Reagan appointed a blue-ribbon panel, the National Commission on Social Security Reform, known as the Greenspan Commission, to study the financing issues and make recommendations for legislative changes.

Resulting legislation, Public Law 98-21, the Social Security Amendments of 1983, was signed into law on April 20, 1983, by President Ronald Reagan (signing ceremony photo). It included the changes to full retirement age.

In addition to increasing full retirement age over many years, the 1983 Amendments made numerous other changes in the Social Security and Medicare programs including the taxation of Social Security benefits and the first coverage of Federal employees.

The 1983 Amendments also provided Social Security coverage for all Members of Congress, the President and Vice-President, Federal Judges and other executive-level political appointees of the Federal Government.

There were many other provisions to the legislation. You can read a summary of the 1983 Amendments here.

Today is the 32nd anniversary of the signing of the 1983 Amendments by President Reagan.


Funding Social Security – payroll tax, income tax & more

Social Security funding information is on the website in the solvency section and in the annual Trustees Report section. Much of the today’s information is from the 2014 Trustees Report. OASDI means Old Age, Survivors and Disability Insurance (Social Security).

The primary portion of Social Security funding is from payroll tax. According to the 2014 Trustees Report (section B – Trust Fund Financial Operations in 2013), “In 2013, net payroll tax contributions accounted for 85 percent of total trust fund income. Net payroll tax contributions consist of taxes paid by employees, employers, and the self-employed on earnings covered by Social Security. These taxes are paid on covered earnings up to a specified maximum annual amount, which was $113,700 in 2013.”

What many people do not realize is that a portion of income tax helps fund Social Security, and Medicare too. No one pays income tax on all of their SSA benefit. Some people pay no tax on their benefits, some on up to 50 percent of benefits and some on up to 85 percent of benefits. Information about income tax and Social Security benefits are here.

Beginning in 1984, Federal law subjected up to 50 percent of an individual’s or a couple’s OASDI (Social Security) benefits to Federal income taxation under certain circumstances. Treasury allocates the revenue derived from this provision to the OASI (Old Age & Survivors Insurance) and DI (Disability Insurance) Trust Funds on the basis of the income taxes paid on the benefits from each fund.

Beginning in 1994, the law increased the maximum percentage from 50 percent to 85 percent. The HI Trust Fund (Health Insurance = Medicare) receives the additional tax revenue resulting from the increase to 85 percent.

This portion of income taxes returns to help fund Social Security retirement, survivors and disability. Again referring to the 2014 Trustees Report, in 2013 about two percent of combined Trust Fund income was from income tax paid on portions of Social Security benefits.

The third major funding source for Social Security is interest on the Trust Funds. There are two separate Social Security funds, the OASI Trust Fund and the DI Trust Fund.

Per the 2014 Trustees Report, “Interest earned on investment of trust fund asset reserves accounted for 12 percent of OASDI income. The Department of the Treasury invests trust fund reserves in interest-bearing securities issued by the U.S. Government. In 2013, the combined trust fund reserves earned interest at an effective annual rate of 3.8 percent.

Less than one percent of combined Trust Fund income was from the General Fund of the Treasury in 2013. Most of this was to reimburse funds for the loss of revenue due to temporary economic stimulus reductions in Social Security payroll taxes.

See the 2014 Trustees Report (section B – Trust Fund Financial Operations in 2013) for more details.

Social Security trust funds

Discussion about the future of Social Security and the trust funds are often part of my classes. While I cannot predict the legislative future, the Social Security website,, has an entire section devoted to the trust funds located in the Solvency section or directly here. 

Two separate trust funds exist, with each started to address different parts of Social Security near the time they were enacted. They are the Old Age and Survivors Insurance (OASI) Trust Fund established in 1937, and the Disability (DI) Trust Fund established in 1957.  

Payroll tax paid by employees, employers and the self-employed are divided between these two trust funds. Since 2000, employees and employers each pay a combined Social Security and Medicare tax rate of 7.65 percent, with the self-employed paying both portions, of which 6.20 percent helps fund Social Security. Of this 6.20 percent, 5.3 percent goes to the Old Age and Survivors Insurance (OASI) Trust Fund and .90 percent to the Disability (DI) Trust Fund. Historical Social Security tax rates are here. In 2015, the maximum amount of taxable earnings for Social Security is $118,500. There is no maximum for Medicare. 

Both trust funds are managed by the Department of the Treasury. Since they are for different purposes, the two funds are managed separately. You can read about transactions, holdings and interest rates of each fund on the Trust Fund data webpages. 

Just available online, the newest Social Security bulletin, Social Security Bulletin, Vol. 75 No. 1, contains an interesting article about the trust funds. 

This online article, “Social Security Trust Fund Cash Flows and Reserves,” by David Pattison, shares a lot of trust fund information, especially in relationship to the overall federal budget. Mr. Pattison is an economist in a research component of the Social Security Administration. 

I found much of the article interesting. You might too. Consider reading at least the following sections:    


        Are the Trust Fund Reserves Assets? Is Interest on Trust Fund Reserves Income?

       Level-Tax Financing and the Trust Fund Reserve Buildup


Fast Facts about Social Security

Did you know that 65% of aged beneficiaries received at least half of their income from Social Security in 2012 or that 55% of adult Social Security beneficiaries in 2013 were women?

Fast Facts & Figures About Social Security, 2014 is available online. This annual chartbook highlights data on the most important aspects of the Social Security and Supplemental Security Income programs—the people they serve and the benefits they provide.

From the Preface: 

Fast Facts & Figures answers the most frequently asked questions about the programs administered by the Social Security Administration (SSA). It highlights basic program data for the Social Security (retirement, survivors, and disability) and Supplemental Security Income programs.

The tables and charts illustrate the range of program beneficiaries, from the country’s oldest to its youngest citizens. In all, about 63.2 million people receive some type of benefit or assistance.  

I thought the sections about beneficiary age and sex interesting. Perhaps you will too.

Social Security Trustees Report for 2014

The 2014 OASDI Trustees Report, officially called “The 2014 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds,” presents the current and projected financial status of the Social Security trust funds. 

OASDI stands for Old Age, Survivors and Disability Insurance (Social Security). There are separate OASI and DI Trust Funds, with information about each in the Trustees Report. 

Dated July 28, 2014, the full report is available at 

It is well worth your time to read at least the report Highlights and Conclusion, both of which are short.  

Short and long-range Social Security program solvency forecasts are provided using different economic possibilities. Overall, the Trustees Report contains much the same forecast for Social Security solvency as last year.  

While not expected to continue for many more years, it may surprise you to read that overall combined Social Security income is exceeding overall expenses with asset reserves still growing. As since 2010, costs exceeded tax income in 2013. 

From the Highlights: 

At the end of 2013, the OASDI program was providing benefit payments to about 58 million people: 41 million retired workers and dependents of retired workers, 6 million survivors of deceased workers, and 11 million disabled workers and dependents of disabled workers. During the year, an estimated 163 million people had earnings covered by Social Security and paid payroll taxes. Total expenditures in 2013 were $823 billion. Total income was $855 billion, which consisted of $752 billion in non-interest income and $103 billion in interest earnings. Asset reserves held in special issue U.S. Treasury securities grew from $2,732 billion at the beginning of the year to $2,764 billion at the end of the year. 

From the Conclusion: 

Under current law, the projected cost of Social Security increases faster than projected income through about 2035 primarily because of the aging of the baby-boom generation and relatively low fertility since the baby-boom period. Cost will continue to grow faster than income, but to a lesser degree, after 2035 due to increasing life expectancy. Based on the Trustees’ best estimate, program cost exceeds non-interest income for 2014, as it has since 2010, and remains higher than non-interest income throughout the remainder of the 75‑year projection period. Social Security’s theoretical combined trust funds increase with the help of interest income through 2019 and allow full payment of scheduled benefits on a timely basis until the trust fund asset reserves become depleted in 2033. At that time, projected continuing income to the combined trust funds equals about 77 percent of program cost. By 2088, continuing income equals about 72 percent of program cost. 

The Trustees project that the OASI Trust Fund and the DI Trust Fund will have sufficient reserves to pay full benefits on time until 2034 and 2016, respectively. Legislative action is needed as soon as possible to prevent depletion of the DI Trust Fund reserves in 2016, at which time continuing income to the DI Trust Fund would be sufficient to pay 81 percent of DI benefits. Lawmakers may consider responding to the impending DI Trust Fund reserve depletion as they did in 1994, solely by reallocating the payroll tax rate between OASI and DI. Such a response might serve to delay DI reforms and much needed corrections for OASDI as a whole. However, enactment of a more permanent solution could include a tax reallocation in the short-run. …

The Trustees recommend that lawmakers address the projected trust fund shortfalls in a timely way in order to phase in necessary changes gradually and give workers and beneficiaries time to adjust to them. Implementing changes soon would allow more generations to share in the needed revenue increases or reductions in scheduled benefits. Social Security will play a critical role in the lives of 59 million beneficiaries and 165 million covered workers and their families in 2014. With informed discussion, creative thinking, and timely legislative action, Social Security can continue to protect future generations.


For Congressional staff and now You: learn about SSA disability

On May 27, 2014, Congressional staff learned about the Social Security disability program when Carolyn W. Colvin, Acting Commissioner of Social Security, keynoted a Capitol Hill presentation by SSA executives.  

Now you can watch this presentation.

This was a teaching session, not a committee hearing.

Included were details about the growth, solvency and sustainability of the disability program by Stephen C. Goss, Chief Actuary, Social Security Administration.

Other sections were about who receives disability, basic eligibility requirements and the disability process including the initial claim and different levels of appeal.

You can watch the video of this teaching session or just see the slides used.

I urge you to take advantage of this opportunity. Information is easily understandable, without technical jargon. 

After introductions, Stephen Goss’s presentation begins at about 6:45 in the video. Other Social Security executives discussed program information after his portion until about 1:00:00 when audience questions began. The full video is about 1:17:34 in length with several guest introductions and comments included during the session.

Analysis of Proposals Affecting SSA Trust Fund Solvency


Upon occasion, the Chief Actuary of the Social Security Administration is asked to review a legislative or policy proposal and to provide an actuarial analysis showing the estimated effect of the item on the long-range financial status of the Social Security Retirement, Survivors and Disability programs.

Many of these proposals and options are intended to address Social Security long-range solvency problems directly while others involve Social Security indirectly. 

You can learn what proposals have been reviewed and read the analysis of each on the Social Security website at  

From the proposal page, follow the “Individual Changes …” link to read about a broad range of policy options that would address Trust Fund solvency and other issues related to Social Security benefits and financing. Many of these options are part of comprehensive proposals intended to restore Trust Fund solvency.

Reach additional SSA actuarial information through the “Our Agency” links on the Social Security homepage,

Where does Social Security money come from?

Q: What are the sources of income to the Social Security Administration?

A: The Social Security Administration has three basic sources of income: payroll taxes, federal income taxes on a small portion of SSA benefits and interest paid to the SSA trust funds. 

Quoting from the Financing section of the recently published Fast Facts & Figures About Social Security, 2013:

 “Social Security is largely a pay-as-you-go program. Most of the payroll taxes collected from today’s workers are used to pay benefits to today’s recipients. In 2012, the Old-Age and Survivors Insurance and Disability Insurance Trust Funds collected $840.2 billion in revenues. Of that amount, 83.8% was from payroll tax contributions and reimbursements from the General Fund of the Treasury and 3.2% was from income taxes on Social Security benefits. Interest earned on the government bonds held by the trust funds provided the remaining 13.0% of income. Assets increased in 2012 because total income exceeded expenditures for benefit payments and administrative expenses.”

 Income to Social Security in 2012 totaled approximately $840.2 billion consisting of about 704.1 billion from payroll taxes and General Fund of the Treasury reimbursements, about 26.9 billion from income taxes on Social Security benefits, and about 109.2 billion in interest earned by the trust funds. More about each of these follows. 

Payroll taxes: Employers, employees and the self-employed pay Social  Security payroll tax up to a an annual yearly limit. This limit is $113,700 in 2013. The 2013 tax rate is set by statute at 6.2 percent for employees and employers, each. Thus, an individual with wages equal to or larger than $113,700 would contribute $7,049.40 to the Social Security program in 2013, and his or her employer would contribute the same amount. The 2013 payroll tax rate for self-employment income is 12.4 percent.

General Fund reimbursements in 2012 were largely due to the temporary payroll tax reduction for employees and the self-employed. Legislation establishing the 2 percent payroll tax reduction also provided for transfers from the General Fund of the Treasury to the Social Security trust funds to offset lost revenues that would have otherwise been received by Social Security.

Income taxes: Based on overall taxable income, some people have to pay federal income taxes on Social Security benefits. Most beneficiaries do not pay income tax on their benefits, some pay on up to 50 percent of benefits and some on up to 85 percent of benefits. No one pays federal income tax on more than 85 percent of his or her Social Security benefits. This income is designated for Social Security. 

Trust Funds: There are two Social Security Trust Funds, the Old Age & Survivors Trust Fund and the Disability Trust Fund. Find Trust Fund information, including transactions, holdings and interest rates, at the About Our Agency tab (solvency section) of

In 2012, the combined income of about $840 billion exceeded total expenditures of about $786 billion so agency reserves grew by about $54 billion. Under intermediate assumptions, the Trustees Report anticipates growth until approximately 2021 for the combined SSA Trust Funds although the Disability Trust Fund is the weaker of the two. Overall expenditures will exceed overall income by about 2021. (See Highlights section of the 2013 Annual Trustees Report.)

 For more information:

Fast Facts & Figures About Social Security, 2013 (see financing section)

2013 Trustees Report (see Highlights Section for summary)