Your Social Security Questions Answered

Every few months, our inbox fills with panicked comments and questions about Social Security's imminent collapse.

It's understandable.

This program supports millions of Americans, and the thought of it disappearing is genuinely terrifying.

But like most viral topics, the reality is far more nuanced than the headlines suggest.

So, in today's LPP Perspectives, I'm addressing the most popular worries and common misconceptions.

But first, grab these two free resources to help with your Social Security planning:

1. ​What Issues to Consider With Your Social Security Benefits (Checklist)

2. ​Will My Social Security Benefits Be Reduced?

   
   

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Social Security Insecurity

What We’ve Heard: Social Security is cutting its staff by 50%.

From the Source: Yes, Social Security is reducing its workforce, but not by anything close to 50%. They have stated that they are reducing their total workforce from 57,000 to 50,000, with the goal of these reductions being to eliminate redundancies and non-mission-critical work efforts. Most of the reductions are expected to be accomplished through retirements and voluntary separations. (SSA Article)

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What We’ve Heard: Social Security is closing local field offices.

From the Source: As of this writing, Social Security has not announced the closure of any local field offices. This misunderstanding may stem from the restructuring plan announced by the SSA, which stated that it is reducing its regional offices from ten to four. (SSA Article #1, SSA Article #2)

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What We’ve Heard: Social Security is eliminating phone services for benefits help.

From the Source: At this time, all telephone-related services remain available in their historical form with one exception: The SSA will now require either online or in-person identity verification when making changes to direct deposit information.

According to SSA, approximately 40% of Social Security direct deposit fraud is associated with individuals calling SSA to change direct deposit information. This new requirement aims to protect beneficiaries and uphold the integrity of the program. (SSA Article)

📝 Related Note to All Three Concerns Above: Recent reports indicate increased wait times for telephone and in-person services as a result of the aforementioned changes. This may be true, but based on my experience, long wait times are not a new complaint, nor are they limited to the SSA. Perhaps some have noticed, as I have, that longer wait times and poor service are becoming more common across all industries (in both public and private organizations). I.e., It's possible that this could just be a sign of the times, more than anything else.

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What We’ve Heard (Again): Social Security is going bankrupt.

From the Source: According to the most recent Social Security Trustees Report, Social Security can pay full benefits through 2035, at which point, the famed Social Security trust fund would be depleted. Beyond that time, assuming Congress takes no further action to remedy this issue, the SSA would initially still be able to pay about 83% of all scheduled benefits, despite the depleted trust fund. This is because Social Security is mostly a “pay-as-you-go” system. Obviously, this potential outcome is not ideal, but it’s far from the doomsday scenario of $0 benefits payable to beneficiaries that some recipients seem to believe is inevitable.

Furthermore, it's encouraging that the calculated changes that would be required to bring Social Security back to full funding status through about 2098 are currently manageable.

Admittedly, getting our elected officials to make these changes may seem like a tall order. But given the incredible importance of the Social Security program to millions of Americans, I’d like to think that the voices of the masses will grow loud enough to get Congress to shore up what I believe is one of the best-run public pension programs in the world. (2024 SSA Trustees Report)

A previous article we've shared discusses some potential solutions to the Social Security deficit and can be found here.

Final Thoughts

Before we wrap up, there is one action item that nearly everyone should consider, regardless of age:

👉 Create your "My Social Security account."

This online portal allows you to review and update your information as well as handle many necessary tasks without ever needing to visit an office.

We hope that this is helpful in clearing up some popular misconceptions.