The Social Security program is nine years away from insolvency, the Social Security Board of Trustees said Wednesday.
This forecast moved up one year since 2024’s annual report, which projected the program to deplete its funding by 2035. Now that projection date is set at 2034.
Medicare’s hospital trust fund will fall short in 2033, when it will only be able to cover 89% of scheduled benefits. This date moved up three years since last year’s report, according to the Medicare Board of Trustees.
“As in prior years, we found that the Social Security and Medicare programs both continue to face significant financing issues,” the Treasury Department said Wednesday.
Tens of millions of Americans who rely on Social Security due to retirement or disabilities would see cuts to their monthly benefits.
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If no changes are made, beneficiaries will only receive 81% of their benefits in nine years, the trustees’ report says.
“This data underscores the need for lawmakers to take action to support the long-term viability of these programs,” Treasury Secretary Scott Bessent said. “Under President Trump’s whole-of-government initiative, the administration will continue to root out waste, fraud and abuse across federal agencies to ensure quality service for beneficiaries and responsible stewardship of taxpayer funds.”
The Social Security trustees cited a recent law upping support for beneficiaries as the culprit for the insolvency drop from 2035 to 2034.
The bipartisan Social Security Fairness Act, which was signed into law earlier this year, added benefits for almost three million public sector employees, including teachers and firefighters.
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The Committee for a Responsible Federal Budget, a D.C.-based think tank, responded to Wednesday’s Social Security and Medicare reports.
“Where is the sense of urgency?” President Maya MacGuineas said. “We are running out of time to phase in changes gradually and avoid harsh cuts, sharp tax increases or unacceptable borrowing.”
Syndicated with permission from The Center Square.