Social security trust fund,
Definition of Social security trust fund:
A government fund composed of the Old-Age and Survivors Insurance (OASI) and Disability Insurance (DI) Trust Fund. The OASI is used to pay for the benefits of retired workers and their families and to the beneficiaries of deceased workers. The DI on the other hand, is used to pay for the disability benefits of workers and their families. The fund is managed by a Board of Trustees who reports to the Congress annually.
Many predict that, due to demographic changes in the United States over the past decades, the Social Security Trust Fund may run out of money sometime this century unless changes are made to Social Security.
The Social Security Trust Fund refers to two accounts used by the U.S. government to manage surplus contributions to the Social Security system. It is used when contributions made by workers and employers exceed the amount currently needed to fund the system to make scheduled benefits payments to retired workers and the disabled. The monies held within the fund are invested in interest-bearing federal securities (Treasury bonds) in order to increase the value of the fund.
How to use Social security trust fund in a sentence?
- The trust fund is expected to stop running a surplus in 2021, at which time it probably will need to gradually draw down its reserves to pay benefits.
- It invests any surplus in low-risk government securities that earn interest and are backed by the full faith and credit of the U.S. government.
- The Social Security Trust Fund receives payroll taxes and pays out benefits to participants.
- The 2020 Social Security Trustees Report shows that retirement/survivor and disability funds will run out in 2035.
Meaning of Social security trust fund & Social security trust fund Definition