What happened?
Social Security's reserves are shrinking. The program spent about $160 billion more than it took in during 2025 alone, pulling from a trust fund that holds roughly $2.56 trillion in U.S. Treasury securities. A Congressional Research Service report, released by Congress's nonpartisan research arm, projects those reserves will run out entirely by 2034.
The program has been drawing down savings since 2020. Total income last year was $1.45 trillion. Total payouts were $1.61 trillion. The gap is covered by redeeming those Treasury securities, but that well has a bottom.
Why Does it Matter to Me?
More than 71 million Americans currently collect Social Security benefits, and an estimated 186 million workers, about 93 percent of the U.S. workforce, pay into the program. If reserves run dry in 2034, the program would be left paying benefits only from incoming payroll taxes. That could mean benefit cuts for retirees, survivors, and disabled workers, though the source report does not specify the exact dollar reduction.
The timeline matters for anyone planning retirement in the next decade or already collecting a check.
Both sides, now
The CRS report surfaces a specific tension Congress will have to weigh. By law, Social Security's reserves must be invested in special-issue, nonmarketable U.S. Treasury securities. In 2025, the existing portfolio earned an average interest rate of 2.6 percent. New securities issued that same year paid 4.3 percent. Critics argue the gap means the trust fund is leaving money on the table.
Some lawmakers have introduced bills to change how the reserves are invested, including past proposals to put a portion into stocks. Various advisory councils and congressional committees have generally backed the current approach over the years, citing stability and the risks of market exposure. The Treasury Secretary has authority to buy marketable federal securities if deemed in the public interest, but the report notes open-market purchases have rarely happened in practice.
What happens next?
No specific legislation to address the shortfall is currently scheduled for a vote. Congress would need to act, either by changing how the trust fund invests its reserves, raising payroll taxes, adjusting benefits, or some combination, before 2034 to prevent automatic cuts.
Because the Old-Age and Survivors Insurance Trust Fund faces depletion within the coming years, its bond maturity schedule has already been compressed to the 2026 through 2033 window, concentrating redemptions into a narrower timeframe than usual. That makes the financial pressure more acute in the short term.
Without congressional action, the math gets harder every year the deficit continues.
---
Spot something wrong? Report an issue with this article