One would not immediately think that the coronavirus would impact Social Security, but it will.
Here’s the good news: From near bankruptcy in 1980, the Social Security Trust Fund now has $2.9 TRILLION. (Yea, Congress!)
Here’s the bad news: This is the year – 2020 – that cash flow turns negative. From now until 2035, the trust fund will shrink, at which time benefits must be cut 21%. (Boo, Congress!)
That’s not all . . . that estimate was made just before the pandemic, which is reducing income to Social Security Trust Fund, because people are out-of-jobs. Plus, it will accelerate the outgo, as people who can retire now, will be forced to do so. The additional cost to the Trust Fund from the coronavirus has not yet been estimated.
The financial planning implication from the coronavirus is . . . expect payroll taxes to increase, just like they did in 1980!
And, of course, save more!!