By Tami Luhby, CNN
(CNN) — Tens of millions of retirees and other Americans could see smaller monthly Social Security checks in six years if lawmakers don’t act to shore up the program’s finances, according to an annual report released Tuesday by Social Security’s trustees.
Social Security’s retirement trust fund – which helps support payments to senior citizens and survivors of deceased workers – is expected to be exhausted in late 2032, which is one quarter earlier than previously forecast, according to the trustees. At that time, payroll tax revenue and other income sources will be able to cover only 78% of benefits owed.
That means the next president could be faced with having to address Social Security’s shaky finances, which have long been considered a third rail in American politics. The issue could play a more prominent role in the 2028 presidential campaign if the projected expected insolvency date remains only a few years away.
The combined Social Security’s retirement and disability trust funds – are expected to be exhausted in 2034, the same as last year’s forecast, according to the trustees. At that time, payroll tax revenue and other income sources will be able to cover only 83% of benefits owed.
Merging the two trust funds would require an act of Congress, but the combined projection is often used to show the overall status of the program.
Medicare’s fiscal outlook also worsened slightly. Its hospital insurance trust fund, known as Medicare Part A, is expected to be able to cover scheduled inpatient hospital benefits until the second quarter of 2033, one quarter earlier than last year’s report from the program’s trustees. At that time, Medicare will be able to pay only 89% of scheduled Part A benefits, which also cover hospice care, short-term skilled nursing facility services and home health services following hospitalizations.
Some 62 million people received Social Security retirement and survivors benefits at the end of 2025, while 8 million Americans received disability benefits, according to the program’s trustees. More than 69 million people were enrolled in Medicare last year.
Social Security’s and Medicare’s finances have long been troubled, largely because the nation’s population is getting older and living longer. They will not run out of money, however, since current workers are paying payroll taxes, which support the programs.
Why is there a change in forecast?
The change in the forecast is due to several factors, including President Donald Trump’s sweeping domestic policy agenda package, the One Big Beautiful Bill Act, which he signed into law last summer. In addition to making permanent lower income tax rates, the law contained an enhanced deduction for senior citizens. The provisions will result in less tax being paid on Social Security benefits, which will reduce the revenue flowing to the Social Security and Medicare trust funds.
“Congress made Social Security’s finances even worse by giving seniors yet another tax break last year, while sending a bigger bill to younger workers tomorrow,” said Romina Boccia, director of budget and entitlement policy at the Cato Institute, a libertarian think tank.
Other reasons behind the acceleration of Social Security’s insolvency date include reductions in the projected fertility rate and in the estimated number of temporary and undocumented immigrants in the US, the trustees said.
Trump’s deportation efforts have raised red flags among some Social Security advocates, who say many immigrants pay taxes even though some may never be eligible to collect benefits.
“This is the first Social Security trustees report that begins to take Donald Trump’s second term policies into account,” said Nancy Altman, president of Social Security Works, an advocacy group. She noted that his “hostility to immigrants” and tax bill, as well as other measures, are reducing the trust fund’s revenue stream.
Social Security experts and supporters used the report’s release to renews their calls for lawmakers to address the looming shortfall.
“This should be a wake-up call: Congress needs to act,” said Myechia Minter-Jordan, CEO of AARP. “Americans have worked hard and paid into Social Security their entire lives, and they deserve to count on it when they retire. No family should see any cuts to what they’ve earned in Social Security.”
