Social Security retirement fund to deplete in 2032

The Social Security retirement trust fund is now projected to be depleted in the fourth quarter of 2032, one year earlier than previously estimated, according to the program's annual trustees report released Tuesday. Without congressional action, this would trigger an automatic 22 percent cut to monthly benefits for retirees and survivors at that time.

The report states that upon the trust fund's exhaustion, ongoing payroll tax revenue would only cover 78 percent of scheduled benefits. The separate Disability Insurance Trust Fund is projected to remain solvent through at least the end of the century. If the retirement and disability funds are considered on a combined basis, the overall Social Security system could pay full benefits until the third quarter of 2034, after which an automatic 17 percent cut would apply.

Social Security Commissioner Frank Bisignano said it is important for lawmakers and the agency to work together to ensure the trust funds provide financial stability for future generations. The trustees urged Congress to act soon, noting that early action would allow necessary changes to be phased in gradually, giving workers and beneficiaries time to adjust.