Question

Social Security is facing a challenge in the future. According to your textbook, by 2075 the old age dependency ratio will be approximately 0.4. Which means that each retired person is supported by 2.5 working people. That's much higher than it has been in the past 0.2. This concerns many people in the question arises will Social Security run out of money? Please explain your initial post how would you solve this problem.

Answer 1

ans 1

this increasing dependency ratio is cause of concern, as it means social secuirty scheme cost will be higher as more retired person per working people are there and it can lead to deficit in the Government account. Also this can lead to increase in non development expenditures of Govt and less money will be left for developmental expenditure and economic growth may slow down.

this probelem can be solved through varoius mesures

1) promoting immigration: Govt can take measures to encourage immigration of working class/ younger generation by realxing the rules and regulations for immigration. when additional working people will be there, then depndency ratio will decrease. more working people will be there to support retired persons

2) encourage seniors to work for longer years and avoid social security schemes. u can increase the retirement age by giving them incentive if they work longer no of years

3) by making seniors healthier so they will put less burden on medical facilities