What does the "Trust Fund" in Social Security refer to?

The "Trust Fund" in Social Security is primarily understood as a reserve fund designed to pay benefits when the contributions made by workers and their employers are not sufficient to cover the payouts required for Social Security benefits. This fund is crucial for ensuring the program's sustainability, especially during periods when the income from payroll taxes—sources of funding for Social Security—falls short of the amount needed for benefits.

When the Social Security Administration collects more in taxes than it pays out in benefits, the excess is deposited into the Trust Fund. This serves as a financial cushion that allows the program to meet its obligations to beneficiaries, even during economic downturns or demographic shifts that may reduce the ratio of workers contributing to the program versus those receiving benefits. Thus, the Trust Fund plays a key role in maintaining the viability and reliability of Social Security benefits for current and future retirees, the disabled, and survivors of deceased workers.