Social Security could run out of money three years earlier than federal officials are projecting, according to a new analysis of spending and demographic data.
Conducted using a budget modeling system released Wednesday, the analysis projects the Social Security trust fund will run dry in 2031 — three years sooner than the Social Security Administration’s forecast.
{mosads}The system, which uses federal budget and census data, was developed at the University of Pennsylvania’s Wharton School.
The project was led by professor Kent Smetters, a former Congressional Budget Office economist and Treasury Department deputy secretary, and advised by high-profile budget experts.
Those include former Office of Management and Budget director Peter Orszag, former White House chief economist Austan Goolsbee, and Committee for a Responsible Federal Budget President Maya MacGuineas.
The Obama administration last week released its projections for the Social Security and Medicare trust funds. Officials warned that the two programs, which made up roughly 40 percent of federal spending in 2015, would becoming insolvent within 20 years.
“Medicare faces a substantial, long-term shortfall that needs to be addressed,” Treasury Secretary Jack Lew told reporters.
Democratic politicians, including President Barack Obama and presumptive presidential nominee Hillary Clinton, have called for expanding Social Security .
The model also allows users to adjust variables like retirement age, benefit levels and tax rates to create new projections.