With Social Security Funds Running Out, Experts Seek Solutions from Everyday Americans
Leave it to Gen Xers to seek a little fun in the otherwise grim debate over what to do with Social Security. The generation stuck between baby boomers and millennials, known for its sense of irony in the face of life’s challenges, apparently has taken a liking to a new game built around Social Security’s upcoming funding problems.
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The game, called the Social Security Challenge, is an online, interactive experience developed by the American Academy of Actuaries. Its mission is to find out how people would address the Social Security insolvency issue.
The insolvency in question refers to the Social Security Old-Age and Survivors Insurance (OASI) Trust Fund, which is expected to run out of money by the middle of next decade. When that happens, the program will have to get all its funding from payroll taxes, which currently cover only 20%-25% of benefits. The coming shortfall has been the center of heated debate this year over whether and how to reform Social Security.
The reason the trust fund is running out of money is because many boomers who use to contribute to it through payroll taxes are now retired and collecting benefits themselves. Current payroll taxes are not enough to make up the difference.
As the American Academy of Actuaries noted on its website, assuring that Social Security stays strong “means that Congress would need to evaluate very different reform options with complex and wide-ranging impacts.”
In the Academy’s Social Security Challenge, players are asked to develop their own proposed reforms by traveling through a virtual town where they can learn residents’ different views on reform, analyze the potential impacts, and sort through the choices. In the Challenge finale, players will select and submit their approaches from various reform options and see how well those approaches work in addressing the solvency issue.
The purpose of the challenge is to educate the public about the funding shortfall and also look into ways Congress could solve it, according to Linda Stone, a senior pension fellow at the Academy.
“There are a lot of misconceptions about Social Security,” Stone told the Financial Planning website. “And as Social Security reform has become more of a topic of conversation lately… I think it’s important for the public to understand what the options are so they can evaluate what they’re hearing.”
Social Security Challenge Offers Nine Categories of Policy During Play
In Financial Planning’s description of the game, nine categories of policy changes appear, ranging from payroll taxes to a change in the formula that calculates the annual Social Security cost-of-living adjustment (COLA), which is designed to help recipients deal with inflation.
As part of its research into the game, Financial Planning asked two retirement policy experts to try out the challenge — and both gave it “rave reviews.”
One of the experts was Mary Johnson, Social Security and Medicare analyst at the Senior Citizens League, a nonpartisan seniors advocacy group.
“Discussion of Social Security policy fixes will make anyone’s eyes glaze over,” Johnson told Financial Planning. “[The game] is a great way to get today’s Gen X and younger crowd engaged, format-wise, while this is simple enough for any non-gamer like me to still have fun and learn something.”
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Another retirement expert — Ron Mastrogiovanni, CEO of Healthview Services — called the game “an excellent idea.”
“What I like about it is you can clearly see how many opportunities there are to actually resolve the issue,” Mastrogiovanni said. “I also think they should send this out to all the elected officials in Washington.”
Johnson agreed on the latter point.
“Engagement is a key element that this format encourages,” she said. “It’s also the element that Congress currently lacks the most.”
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This article originally appeared on GOBankingRates.com: With Social Security Funds Running Out, Experts Seek Solutions from Everyday Americans
