Understanding the Growing Number of People with Disabilities: Insights and Implications

In this blog post, we'll delve into our latest episode where we explored a critical and somewhat unsettling chart detailing the rising number of people with disabilities in the United States. This discussion is based on data from the Federal Reserve's FRED database and sheds light on the possible impacts this trend may have on social security and our financial futures.

Key Takeaway 1: The Alarming Trend

“You ever find a chart that you just find terrifying?”

In our latest episode, we examined a chart showing the population with a disability aged 16 and over. Since 2008, the number has moved from 27 million to a current estimate of 34 million. The most disturbing aspect is the significant increase starting in 2020, which raises questions about changes in reporting or other factors.

Key Takeaway 2: Understanding the Data

“And that's why that distinction is made instead of at 18 years. It's multiplied by a thousand because the number is in thousands.”

We discussed how this data is collected and structured. The Federal Reserve’s FRED database compiles data streams from different departments into one system that facilitates easy charting. Specifically, the chart we're analyzing quantifies the population with a disability as thousands, reflecting a granular look at governmental reporting metrics.

Key Takeaway 3: Percentages Make The Picture Clearer

“Whenever you have a total number compared to a population that is changing, it's important to look at the percentage rate.”

To better understand the magnitude of this change, we converted the numbers into percentages. From 2008 to 2020, the disability rate hovered around 11.5%. However, it has now spiked to 12.5%. This may seem small, but within a population of over 300 million, this equates to millions of people and signifies a notable shift.

Key Takeaway 4: Impact on Social Security

“The other thing that gets me into thinking about this, though, is I look a lot at the social security reports…”

The trend in rising disabilities has profound implications for social security. Currently, social security is split into two pools: old age benefits and disability insurance. With the surge in the disabled population, these projections could be underestimated, leading to even greater financial strain on an already beleaguered system.

Key Takeaway 5: Practical Advice

“So, the real answer as far as dealing with this chart is that you don't want to become dependent on social security as your main livelihood…”

We concluded the episode with practical advice for financial planning. The best defense against these unsettling trends is to build your own financial security. By managing the money you earn more efficiently, saving, and investing wisely, you can reduce dependency on social security benefits and insulate yourself from policy changes and economic uncertainties.

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By staying informed and proactive, you can navigate these complex and sometimes frightening trends with confidence. Let's take control of our financial destinies together.