Will Social Security Run Out?

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As millions of Americans look forward to retirement, the prospect of Social Security no longer being available has some worried.

The latest annual Social Security and Medicare Trustees Reports headed by the U.S. Department of the Treasury states that the Old-Age and Survivors Insurance Trust Fund (OASI), which pays out retirement and survivor benefits, will be able to pay 100% of people’s benefits until 2033. 

When Will Social Security Run Out?

“At that time, the fund’s reserves will become depleted and continuing program income will be sufficient to pay 77% of scheduled benefits,” the report says.

Money expert Clark Howard says the news has caused people to feel uneasy about their future retirement:

“It has led people to feel like, ‘I’d better get it while I can. I’d better get what I can because Social Security is going to be broke in 10 years and nobody’s going to get any money!'”

While you may feel like that, Clark wants you to sit tight. He continues to steadfastly recommend that Americans wait until age 70 to collect Social Security, which is what he plans to do.

Social Security: How It Began

The Social Security program began in 1935 as a social insurance program that could provide income for retired workers as they age out of their employable years. In 1939, a change in the law allowed survivors and children to benefit from Social Security as well.

Social Security: How It’s Going

But the Social Security program has run into sustainability issues in recent decades. Here are some factors that are contributing to the projected Social Security shortfall:

  • As the Baby Boomers age, more Americans are retiring, which is creating a smaller workforce to fund the program.
  • Lifelong employment with a single employer has largely gone away, Clark says.
  • Americans are living longer
  • It’s been many years since the U.S. Congress has addressed projected shortfalls in the Social Security program.

The culmination of these factors means that at the current rate, the Social Security program will be depleted in about 10 years and payouts will be reduced. But then what happens?

What Will Happen to Social Security in 2033?

While the U.S. Treasury’s report doesn’t go on to project how long the Social Security program can last with a 77% payout schedule, Clark is confident the system can last for many years if responsive leadership takes the issue seriously and acts.

“I believe that it will be dealt with by a future Congress. The later we wait, the more difficult it will be to fix, but it will be fixed,” he says.


The important thing that Clark wants consumers to note is that there’s a huge difference between no Social Security and a reduced Social Security, which is what the report has forecast.

“Even if the dire predictions come true — and Congress does nothing about it — in 2033, what happens is Social Security checks don’t stop,” he says. “The amount of money you receive will be based on pay as you go, at that point.”

Should You Still Wait Until Age 70 Before Taking Social Security?

So the problem’s there, but does it in any way change Clark’s answer about waiting to retire at age 70? “It does not,” he says. “Because again, Social Security is not going to stop paying even if Congress does the irresponsible thing — buries its head in the sand — and does nothing.”

And What Happens if Congress Doesn’t Enact Some Social Security Reform?

“It’s not a hard one to fix,” Clark says of Social Security’s issue, “but even if it’s not fixed, I’m telling you still, I would wait.”

One reason why Clark would still wait until age 70 to take Social Security is how much money he’d be leaving on the table if he lives another 20 to 30 years.

“The greatest risk for all of us is something that’s actually good: longevity,” he adds. “And the check you get from the base [of Social Security] and then … the cost of living adjustments over the years are so much higher if you wait. And if you’re married, it may also heavily affect your spouse and the benefits they would receive after you pass away.”

Final Thoughts

Yes, Social Security needs some fixing, but it will still be around when you retire, so there’s no need to panic. Clark says the system will survive as long as responsible lawmakers continue to make substantive changes to the program as needed.

“The problems with Social Security are not major problems to fix, particularly if we fix them now or in the next year or two,” he says.

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