For 78 years, Social Security has been making payments to eligible beneficiaries, and in the process, keeping a number of them above the federal poverty level. An analysis from the Center on Budget and Policy Priorities from 2016 suggests that 22.1 million beneficiaries owe their ability to live above the federal poverty level to their guaranteed Social Security checks.
Social Security will survive, but it won't look the same
But this program, which so many retirees are currently leaning on or will rely on in the years and decades to come, is just an estimated 16 years from an inflection point, according to the latest Social Security Board of Trustees report released in early June. Beginning in 2018 and continuing with each subsequent year, Social Security will be paying out more in benefits than it generates in revenue.
Even though this net cash outflow will start off small ($1.7 billion in 2018 and $0.2 billion in 2019), it's expected to accelerate with each passing year, beginning in 2020. By 2027, per the intermediate-cost model, $169 billion more in benefits will flow out of Social Security than is expected to be collected in revenue.
Obviously, the program can't continue running a deficit forever. Since the last major Social Security reform in 1983, it's built up approximately $2.9 trillion in asset reserves. However, it's expected to take just 16 years to completely exhaust these reserves, such that by 2034, there'll be nothing left, assuming no additional revenue is raised or cost-cuts implemented by lawmakers.