On Jan. 19, the US outstanding debt hit its statutory limit. With the clock ticking for the country to avoid a default on its debt, experts are sounding the alarm about potential disruptions to Social Security. But should we actually be concerned?

In today’s episode of Fiscally Savage, Dylan explains what Social Security is, how it came about, and how it works. He also addresses some common talking points on Social Security — that it’s going bankrupt, that it’s exploding the national debt, and that it’s a Ponzi scheme.

Show Highlights

[02:09] What is Social Security?
[07:14] How Social Security income came to be taxable
[10:52] How Social Security is funded
[14:42] Why Social Security is not exploding the national debt
[19:11] Why Social Security will never go bankrupt
[22:02] Why putting a cap on payroll taxes decreases employment
[25:28] Why Social Security is not a Ponzi scheme

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Demystifying Social Security: What It Is, How It Works, and Why You Should Care