Financing
Since 1997, the OASDI program have always placed a requirement for their workers and their employers and self-employed persons to pay taxes on every earning to cover jobs up to the annual taxable maximum. Amounts are automatically adjusted as wages continue to rise. There are two separate trust funds that funds are placed in; the OASI Trust Fund and the DI Trust Fund. All the money that is received by the trust funds is usually used to pay the benefits and operating expenses of the program. If there is expenses or increments not needed they are automatically invested in interest-bearing securities. These interest-bearing securities are guaranteed by the U.S. Government. The income from trusts fund income includes all amounts that …show more content…
An easy short-term solution will be to adjust the division between the two. However, there are many underlying elements of the problem. Since the full retirement age has increased from 65 to 66 and for those born after 1960 will go to 67, many individuals will probably be classified in a high disability incidence. This extension of the retirement age allows individuals to utilize means for a few additional years of collecting benefits from the DI trust fund rather than the OASI trust fund. Another problem is the despondence from the aging of the baby-boom generation. The “baby boom” has been identified as having any individuals who were born between 1946 and 1964. Those who are classified as “boomers” turned 50 and were thus well into the years of high disability rates between 1996 and 2014. These boomers have caused a great impact on draining DI trust fund. The 2001 recession and especially the 2008 Great Recession also became a problem (Kilgour, …show more content…
Although they may be able to continue to do their current job, if they ever decide to quit working it will become extremely hard for them to find another job. This becomes a problem because not only will it be hard to seek employment, they will not be eligible for OASI retirement benefits yet. Sometimes this requires them to apply for DI benefits that will hopefully, hold them over until retirement benefits do become available. The SSA has been classified as a “safety net” of the United States. For most citizens. It is reported that, “almost everyone is related to or acquainted with one or more of the 8.9 million people who are on disability.” This is what adds reasoning that the OASDI should continue. These are problems that congress will have to address in order to get to the long-term problems long before. If officials wait longer than expected the problems may continue to grow for baby boomers. It is not necessary that the OASDI trust funds run a surplus or become fully funded. It is suggested that HR and compensation and benefits professionals should voice their input to those demanding early action in request to save and revitalize problems among the Social Security Administration. They must be able understand the eligibility, benefits, funding sources to provide employees and their families with a comprehensive and cost-effective benefit structure for future
Since 1997, the OASDI program have always placed a requirement for their workers and their employers and self-employed persons to pay taxes on every earning to cover jobs up to the annual taxable maximum. Amounts are automatically adjusted as wages continue to rise. There are two separate trust funds that funds are placed in; the OASI Trust Fund and the DI Trust Fund. All the money that is received by the trust funds is usually used to pay the benefits and operating expenses of the program. If there is expenses or increments not needed they are automatically invested in interest-bearing securities. These interest-bearing securities are guaranteed by the U.S. Government. The income from trusts fund income includes all amounts that …show more content…
An easy short-term solution will be to adjust the division between the two. However, there are many underlying elements of the problem. Since the full retirement age has increased from 65 to 66 and for those born after 1960 will go to 67, many individuals will probably be classified in a high disability incidence. This extension of the retirement age allows individuals to utilize means for a few additional years of collecting benefits from the DI trust fund rather than the OASI trust fund. Another problem is the despondence from the aging of the baby-boom generation. The “baby boom” has been identified as having any individuals who were born between 1946 and 1964. Those who are classified as “boomers” turned 50 and were thus well into the years of high disability rates between 1996 and 2014. These boomers have caused a great impact on draining DI trust fund. The 2001 recession and especially the 2008 Great Recession also became a problem (Kilgour, …show more content…
Although they may be able to continue to do their current job, if they ever decide to quit working it will become extremely hard for them to find another job. This becomes a problem because not only will it be hard to seek employment, they will not be eligible for OASI retirement benefits yet. Sometimes this requires them to apply for DI benefits that will hopefully, hold them over until retirement benefits do become available. The SSA has been classified as a “safety net” of the United States. For most citizens. It is reported that, “almost everyone is related to or acquainted with one or more of the 8.9 million people who are on disability.” This is what adds reasoning that the OASDI should continue. These are problems that congress will have to address in order to get to the long-term problems long before. If officials wait longer than expected the problems may continue to grow for baby boomers. It is not necessary that the OASDI trust funds run a surplus or become fully funded. It is suggested that HR and compensation and benefits professionals should voice their input to those demanding early action in request to save and revitalize problems among the Social Security Administration. They must be able understand the eligibility, benefits, funding sources to provide employees and their families with a comprehensive and cost-effective benefit structure for future