Social Security Feeling The Strain This Year

Desperate Or Otherwise, More Americans Collecting Earlier

NEW YORK (CBS 2) — It’s one of the most striking fallouts from our nation’s bad economy: Social Security is facing a rare shortfall this year as a wave of people is opting to collect payments before their full retirement age.

CBS News business and economics correspondent Rebecca Jarvis has the story.

After working 40 years in the chemical industry, Michael Tait could not wait until he turned 66 — the full retirement age — to collect Social Security. He can’t find a job.

“Lowe’s and Home Depot and the grocery stores and the gas station, you know, nothing,” Tait said.

With his unemployment checks running out, Tait decided to apply for his Social Security retirement benefits two years early, at 64, despite the catch: when you collect early, your benefit is cut up to 25 percent, permanently. For Tait, that’s a loss of $252 every month.

Still …

“Something coming in right now. I got to take care of my family, and that’s the most important thing,” Tait said.

Semi-retired medical lab technician Bobby Lee said he will apply for Social Security as soon as he’s allowed to — when he turns 62, next year.

“It will give me more financial freedom. You’ll get less, but nobody guarantees how long you’re gonna live,” Lee said.

Lee and Tait are part of a growing trend.

Last year, 72 percent of the 2.7 million new filers opted into Social Security early. In 2007 and ’08, 74 percent did, which was a record high. In 1980, just 57 percent collected early, and in 1970, 47 percent.

Michael Astrue heads the Social Security Administration and said even as more elderly Americans postpone retirement, many others are having it forced upon them.

“People who would not have retired — would not have taken retirement benefits for the recession — are taking benefits, we believe, because they have no real choice,” Astrue said.

Since the great recession began in December 2007, the rate of unemployed workers 55-and-older has increased faster (115 percent) than for any other age group, and half the older unemployed (53 percent) have been out of work for more than six months.

“I have a feeling that this government is not going to allow senior citizens like myself and others just to die on the vine,” Tait said.

Millions are living out a 75-year-old promise, earlier than they had planned.

As a result, Social Security is paying out more money this year than it collects in taxes. And the future doesn’t look much better.

Social Security benefit payouts will permanently exceed tax revenues by the year 2015, when 78 million baby boomers are set to retire.

That begs the question: If taxes aren’t enough to cover the payouts, then where’s the government going to get the money to pay for the benefits?

The answer is over the years our government has set aside a trust fund to cover Social Security. The problem is that all that money will be spent by the year 2037.

So basically in less than 30 years, we’ll have just one thing left to cover Social Security: our tax dollars.

Comments

One Comment

  1. JOSEPH BOPSSACK says:

    I ASK ALL THE PEOPLE OF THIS COUNTRY TO GO ON YOUR COMUTERS AND TYPE IN (WHAT IS AN ELECTORIAL VOTE) AND READ READ READ. THIS WILL EXPLAIN HOW YOUR VOTE FOR PRESIDENT DOES`NT COUNT. IT`S THE ELECTOR`S OF EACH STATE THAT MAKE THE VOTE. NOTE YOU. READ PEOPLE READ.

  2. JOSEPH BOSSACK says:

    To all the people of this country, Please do yourself a good deed. READ THE FIRST PAGE OF THE DECLARATION OF INDEPENDENCE .VOTE THESE PEOPLE OUT

  3. Joseph Bossack says:

    The people who run this government, have been lying to all of us for years and still are.Thats one thing that will never change.

  4. FleeingCal says:

    ….where’s the government going to get the money to pay for the benefits?
    The answer is over the years our government has set aside a trust fund to cover Social Security…..

    Phew… for a minute there I thought SSA was going to come after the taxpayer to backfill the shortage. Thank God for the Trust Fund!!!. BTW did I miss the edition of CBS news where they covered Nancy and Harry trotting over to that office in WV to grab a handful of those “special” bonds and presenting them to the clerk at the local 7-11 AM/PM for a cash refund? I heard rumors that they only got $1.38 for the recycle value of the paper and with that they bought a Super PowerBall Lotto ticket. Would someone pls send me a link,, maybe it’s on YouTube….

  5. sergi says:

    Had the government not offered a tax break to my firm to outsource my
    customer service job to Coata Rica, (no less), I would not be collecting SS
    early. But they did, so I did.

  6. carolyn Birmantas says:

    The governement should just remove the ceiling . It has been raised several times in my folks life time and once in my own..just remove it. As long as you work, you pay in..and then the govenment must leavit it alone. Money paid into to SS should remain just for SS…. keep their hands off of it…

Comments are closed.

More From CBS New York

BUY TICKETS NOW
Get Our Morning Briefs

Listen Live