Social Security is one of the most important programs in the United States. For millions of retired Americans, these monthly checks are not just numbers—they help pay for rent, medicine, food, and basic needs. Without Social Security, many seniors would not be able to survive.
But there is a growing concern: according to the 2025 Social Security Trustees Report, retirees could face a major benefit cut in the future.
If nothing is done, by 2033 retirees might see a 23% drop in their payments, which means about $553 less per month for the average retired worker. Let’s break down what this means, why it’s happening, and what possible solutions are being discussed.
Why Social Security Benefits May Shrink
Social Security is funded mainly by two big sources:
- Payroll Taxes: Money collected from workers and their employers.
- OASI Trust Fund Reserves: Savings from past surpluses, invested in special U.S. Treasury bonds.
The problem is that the OASI Trust Fund is expected to run out by 2033. After that, payroll taxes alone will only cover 77% of promised benefits. That means automatic cuts for retirees if no reforms are made.
How Much Money Is at Stake?
In June 2025, the average Social Security check for a retired worker reached $2,005.05—the first time payments crossed the $2,000 mark.
If average COLAs (Cost-of-Living Adjustments) stay around 2.3%, benefits could rise to $2,405 by 2033. But with a 23% cut, retirees would only get $1,852 per month—a painful loss of $553.
| Year | Projected Average Benefit | After 23% Cut | Monthly Loss |
|---|---|---|---|
| 2025 | $2,005 | $1,544 | -$461 |
| 2033 | $2,405 | $1,852 | -$553 |
For the 50% of retirees who depend mostly on Social Security, this kind of cut would be devastating.
What’s Causing the Shortfall?
Several factors are putting stress on the Social Security system:
- Demographics: More retirees but fewer workers paying in.
- Longer Lifespans: People live longer, so they collect benefits for more years.
- Falling Birth Rates: Fewer young workers to replace retirees.
- Reduced Immigration: Slower growth in the working population.
- Payroll Tax Cap: In 2025, only the first $176,100 of income is taxed. High earners don’t pay taxes on income above that limit.
- Congressional Delays: Lawmakers have avoided making reforms, which makes the problem worse.Possible Fixes Being Debated
No solution is simple, but experts and lawmakers are discussing several options:
- Raising or eliminating the payroll tax cap – So higher earners contribute more.
- Increasing payroll tax rates – Shared by both workers and employers.
- Raising the full retirement age – This means future retirees would get benefits later, reducing lifetime payouts.
- Adjusting COLAs – Linking cost-of-living increases to a slower inflation index.
- Means testing – Phasing out or reducing benefits for higher-income retirees.
Each of these solutions comes with political debates and economic trade-offs.
Why Action Is Urgent
The Trustees Report warns that the sooner changes are made, the easier it will be. Small adjustments today could prevent big benefit cuts or steep tax hikes in the future.
It’s important to understand that Social Security will not “completely run out of money” in 2033. Payroll taxes will still provide 77% of benefits. But if Congress does nothing, retirees will see automatic cuts.
What Retirees and Workers Should Do
- Stay informed about ongoing debates in Congress.
- Plan for retirement carefully, considering possible lower benefits.
- Save independently where possible through pensions, 401(k)s, or IRAs.
- Expect changes in retirement age or taxation rules.
By preparing early, workers and retirees can avoid being caught off guard.
The future of Social Security is at a critical point. Without reforms, the average retiree could lose $553 per month by 2033. This isn’t just about numbers—it’s about real people struggling to pay bills, buy medicine, and live with dignity.
The choices Congress makes in the coming years will decide whether Social Security continues to be a strong financial lifeline or becomes a weakened system that forces seniors to live with less. For workers today, the message is clear: stay prepared, stay informed, and push for reforms that keep Social Security strong for generations to come.
FAQs
Will Social Security really run out in 2033?
No. Social Security will not run out completely. Payroll taxes will still cover about 77% of benefits, but retirees could face automatic cuts if Congress does not act.
How much could retirees lose per month?
By 2033, retirees may lose around $553 per month, which equals a 23% cut in benefits.
What can Congress do to fix Social Security?
Congress can raise payroll taxes, lift the tax cap, increase retirement age, adjust COLAs, or apply means testing for wealthy retirees.