Social Security Deficits: What You Need to Know

Social Security is vital for many Americans, but the program faces long-term financial problems. According to a report from the Congressional Budget Office, Social Security will run a 12% deficit for the next decade. Retirees are nervous about how that could affect their benefits.

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, runs through the CBO report to look at the impact of Social Security deficits. Dan notes that right now, the Social Security Trust Fund has enough money to cover the deficits, but with the gap expected to rise to 30% by 2030, the Trust Fund will eventually run out of money. That could cause a big problem in the early 2030s, as tax revenue will only bring in about $1 for every $1.30 in benefits promised. That's one big reason policymakers are looking at potentially draconian cuts in order to prevent even larger cuts later.

Learn more about Social Security
Social Security might be in trouble, but you still need to be smart enough to get the most you can from it. Get the information you need by reading our brand-new free report, "Make Social Security Work Harder For You." Inside, our retirement experts give their insight on making the key decisions that will help ensure a more comfortable retirement for you and your family. Click here to get your copy today.

The article Social Security Deficits: What You Need to Know originally appeared on Fool.com.

Neither Fool contributor Dan Caplinger nor the Motley Fool has any position in any stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.