Social Security Trust Fund Predicted to Fall Short One Year Sooner

The Social Security trust funds have enough money to pay full benefits to retirees and other beneficiaries until 2034 before reducing benefit payments, one year earlier than previously expected, according to the Social Security Administration Board of Trustees’ annual report released Wednesday.

After 2034, the combined asset reserves of the Old-Age and Survivors Insurance and Disability Insurance trust funds are forecast to have enough revenue to pay only 81% of benefits payable at that time. Last year’s annual report projected the funds would cover full benefits until 2035, which had increased one year from 2023’s report.

“To ensure we serve the public and deliver high-quality service to the 185 million people who work and pay payroll taxes for Social Security and the 70 million beneficiaries who will receive benefits during 2025, the financial status of the trust funds remains a top priority for the Trump Administration,” said Frank Bisignano, the Social Security commissioner, in a statement. “Congress, along with the Social Security Administration and others committed to eliminating waste, fraud, and abuse, must work together to protect and strengthen the trust funds for the millions of Americans who rely on it—now and in the future—for a secure retirement or in the event of a disability.”

According to the report, the OASI Trust Fund is projected to become depleted in 2033, in line with previous estimates, covering 77% of benefits after depleting. The DI Trust Fund reserves are not projected to be depleted over the next 75 years.

The combined reserves of the trusts declined by $67 billion in 2024 to $2.72 trillion. Meanwhile, the total annual cost of the program is projected to exceed total annual income in 2025, continuing a trend that began in 2021.

Total income from the two trust funds amounted to $1.42 trillion in 2024, while there was $1.47 trillion in benefits paid out to nearly 68 million beneficiaries during the year.

The report stated that the Social Security Fairness Act of 2023, on January 5, affected the program’s financial status since it “increases Social Security benefits for people who worked in jobs that were not covered by Social Security.”

The combined trust fund asset reserves earned interest at an effective annual rate of 2.5% in 2024. The projected actuarial deficit over the 75-year long-range period is 3.82% of taxable payroll, greater than the estimated 3.5% from a year ago, according to the report.

The board of trustees typically has six members—the Social Security commissioner; the secretaries of health and human services, treasury and labor; and two public trustees appointed by the president—but currently there are two vacant positions, as there were during the time of last year’s report.

The current trustees are Bisignano, who was confirmed by the Senate on May 6; Secretary of the Treasury Scott Bessent; Secretary of Health and Human Services Robert F. Kennedy, Jr.; and Secretary of Labor Lori Chavez-DeRemer. The remaining two spots are subject to Senate confirmation; only one may be a Republican, as they may not both belong to the same political party. President Trump has not put forward nominations for either of the two open positions.

“The Trustees recommend that lawmakers address the projected trust fund shortfalls in a timely way in order to phase in necessary changes gradually and give workers and beneficiaries time to adjust,” the report stated. “Implementing changes sooner rather than later would allow more generations to share in the needed revenue increases or reductions in scheduled benefits.”