Correction: This article originally incorrectly stated how much money the Social Security retirement fund made and how much it was worth in 2025. The story has been updated. We regret the error.
Americans’ Social Security benefits will be cut by about a quarter in six years due to dwindling funds, according to a June 9 report from the Social Security Board of Trustees. That’s several months earlier than the group’s 2025 target.
For years, trustees and experts have warned about Social Security’s precarious financial position. An aging population, low fertility rates and worsening income inequality have forced the program to pay out more in benefits than it receives in taxes.
“The program is paying out more benefits, more than it is generating in revenue, and that’s creating a funding gap that can’t last forever,” said Shai Akabas, vice president for economic policy at the Bipartisan Policy Center.
But the earlier-than-expected deficit was caused in part by President Donald Trump’s tax and spending cuts bill and his restrictive immigration policies, trustees said.
Social Security’s six-year insolvency means senators elected in November’s midterm elections will likely be forced to vote on changes to the program, experts told PBS News.
“When we vote, we are choosing leaders who will decide the future of this program,” said Kathleen Romig, a senior fellow at the Center on Budget and Policy Priorities.
It has been more than 40 years since Congress passed major changes to the program. In 1983, during a solvency crisis, Congress passed Social Security amendments that, in part, gradually increased the retirement age from 65 to 67 for people born in 1960 and later.
“We cannot afford to continue to operate a system that was built almost a century ago and has not undergone significant changes,” Akabas said. “We really need to modernize the economic system we have today and that’s the only way we can make it sustainable in the future.”
Here’s what you need to know about the future of Social Security.
Why are Social Security funds running out earlier than expected?
Each year, Social Security’s Board of Trustees submits a report to Congress updating the program’s financial status. Social Security needs enough money to pay the program’s beneficiaries and cover its administrative costs.
The Social Security pension fund earned $1.2 trillion in 2025, largely from the 185 million people who paid payroll taxes into the Social Security system. But the program, which provided benefits to more than 56 million people, cost $1.4 trillion. The program brought more than it brought.
Watch the PBS News Hour segment in the player above.
For years, the Social Security trust fund supplemented expenses that were not covered by taxes. But the trust fund’s reserves are running low. The 2026 report revised this depletion to the end of 2032. The trustees said the program will only have enough money to pay 78% of benefits as of this year.
Three factors influenced the updated timing of the report.
- Fertility rates: The trustees updated the estimated birth rate. People are having fewer children, which in the long run means that as the U.S. population ages, there will be fewer workers paying into Social Security.
- Immigration levels: It is estimated that fewer immigrants are living in the United States temporarily or illegally due to Trump’s policies. Most immigrants without legal status in the United States pay taxes but are not eligible for Social Security benefits. That means they contribute more to the program than they receive, which helps close the funding gap, Akabas said.
- Trump Tax Bill: While Trump’s “One Big Beautiful Bill Act” did not end taxation of Social Security benefits as he promised, it did cut taxes for a large group of beneficiaries. As a result, the Social Security trust fund received less tax revenue than it would have received if the law had not been passed.
US war in Iran and continued strict immigration policies could speed up timeline
Social Security’s solvency deadline could be extended in next year’s report, said Nancy Altman, president of the advocacy group Social Security Works.
The report is based on data from 2025, before the start of the US war in Iran. Social Security benefits are adjusted based on the cost of living, so higher inflation could cause the program to pay out more benefits than it did last year.
Another year of strict immigration policies will also continue to impact Social Security’s solvency. The trustees expect immigration levels to rise after Trump leaves office, Romig said, but that is not a given.
That assumption “overshadows the reality that if we go down a path of really draconian immigration policies that last longer than a couple more years, that will have very serious consequences for the social security system,” she said.
What can be done to prevent cuts to Social Security benefits?
Economic policy groups have long proposed policy changes that would prevent Social Security from going bankrupt. Although several legislators introduced legislation, Congress failed to act. Any solution must have bipartisan support to circumvent the Senate filibuster.
“The policy is actually quite simple,” Altman said. “It’s politics that is difficult.”
“The policy is actually quite simple,” Altman said. “It’s politics that is difficult.”
“We’ve now reached a point where it’s almost politically impossible for both sides to come together around a package that will actually avoid depleting the main Social Security trust fund,” Akabas said.
Congress has three main approaches it could take to correct Social Security’s imbalance, and none of them has broad bipartisan support: reduce the amount of money coming from Social Security, increase the amount of money coming in, or a combination of both.
Congress could cut benefits either by reducing the amount of money people receive or by raising the retirement age.
To make more money, Congress could raise taxes, increase the maximum taxable Social Security income, or impose taxes on non-wage income. Currently, wage income above $184,500 or non-wage income, such as investments, cannot be subject to Social Security taxes.
Those two factors, compounded by growing wealth inequality, have worsened Social Security’s insolvency crisis, experts told PBS News.
The amount of Social Security money that can be used to receive Social Security is shrinking because most of the country’s income cannot be taxed under the program, Akabas said.
However, simply making these changes will not be enough to immediately prevent benefit cuts.
“As policymakers make reforms to the program, they will also have to think about how they will account for the fact that even with the reforms they make, the trust fund will likely go into the red around 2032,” Akabas said.
Most changes to the Social Security system will likely take time to be phased in, he said. In the meantime, Congress may have to allow Social Security to borrow money to pay beneficiaries.
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