Which presidents have borrowed from Social Security?
Lyndon Johnson was the first president to borrow from the Social Security Trust Fund. He needed to pay for the Vietnam War. Next was Ronald Reagan and the military buildup of the 1980s. GW Bush did in the 2000's.
The Trust Fund represents a legal obligation of the federal government to program beneficiaries. The government has borrowed nearly $2.8 trillion as of 2014 from the Trust Fund and used the money for other purposes.
- In June 2011, the average Social Security benefit was $1,180.80 per month. The maximum possible benefit for a worker retiring at age 66 in 2011 is $2,366. But to get this amount, the worker would need to earn the maximum taxable amount, currently $106,800, each year after age 21. Familiarize yourself with the formula.
- The news in the most recent Social Security Trustees' annual report released wasn't good—the Trustees now project that the old age and disability trust funds combined will be unable to pay full benefits in 2033, three years sooner than projected in last year's report.
- For people with lower than average earnings, the ratio of the lifetime benefits they receive from Social Security to the lifetime payroll taxes they pay for the program is higher than it is for people with higher average earnings. In that sense, the Social Security system is progressive.
Social Security is funded with income from four sources. Social Security is primarily funded by payroll taxes assessed on wages in the United States. The employer pays 6.2% of income, and the employee chips in another 6.2%. The self-employed, being both employer and employee, pay 12.4% of income into the program.
- Workers and employers pay for Social Security. Workers pay 6.2 percent of their earnings up to a cap, which is $127,200 a year in 2017. (The cap on taxable earnings usually rises each year with average wages.) Employers pay a matching amount for a combined contribution of 12.4 percent of earnings.
- Remember, the earliest a person can start receiving Social Security retirement benefits will remain age 62. If you start receiving retirement benefits at: age 62, you will get 75 percent of the monthly benefit because you will be getting benefits for an additional 48 months.
- According to the institute's data, a two-earner couple receiving an average wage — $44,600 per spouse in 2012 dollars — and turning 65 in 2010 would have paid $722,000 into Social Security and Medicare and can be expected to take out $966,000 in benefits.
The Social Security trust funds are invested entirely in U.S. Treasury securities. Like the Treasury bills, notes, and bonds purchased by private investors around the world, the Treasury securities that the trust funds hold are backed by the full faith and credit of the U.S. government.
- Contrary to a common misconception, Solicitors do not earn any interest on clients funds held in their Trust account. In this state, all interest earned on funds in Solicitors Trust accounts is paid directly to the Law Society of New South Wales.
- Lyndon Johnson was the first president to borrow from the Social Security Trust Fund. He needed to pay for the Vietnam War. Next was Ronald Reagan and the military buildup of the 1980s. GW Bush did in the 2000's.
- The 2014 report from the trustees of the Social Security program estimated that the trust fund reserves will run out in 2034. That means Social Security won't be able to pay full retirement benefits starting in 2033.
Updated: 26th November 2019