Profitt Report: Report says Social Security, Medicare benefits will be depleted

Photo credit: MGN

It’s a fact of working life: you pay taxes for social security and Medicare, but the federal government says both programs are in trouble. New projections from the Trustees for Social Security say the money won’t be there if things don’t change.

If you’re employed, you pay 6.2 percent in Social Security tax, 1.45 percent in Medicare. You aren’t using that money right now: it’s funding those programs for folks who are currently using it, mostly people 65 years and older.

Here’s the problem according to Bob Wright with Complete Wealth Advisors in Flint Twp.: “there's more people retiring and drawing benefits. We don't have the same number of people coming behind them and working to pay for those benefits.”

He wasn’t surprised to read about this year’s report from the Trustees for Social Security. It says Medicare will run out of money in 2026 and Social Security will be wiped out in 2034.

Here’s how Wright sees it: regardless of the latest headlines, save your money like social security won’t exist.

“If social security is there, it's just gravy. It's the extra,” he said.

Wright said it’s smarter to rely on yourself in retirement, not Social Security checks. Think about your 401(k), IRA and investments.

“It might even be a wake up call to some people to say you know, what Social Security? There's a good chance something is going to change for social security because the math says it has to. It can't keep going the way it is,” Wright said.

He doesn’t think Social Security will go away completely: his estimate is people will just receive less money than anticipated.

For more information on the Trustees' report, please click here.

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