Millions of seniors depend on Social Security to pay the bills in retirement, but the program is facing some serious financial issues that could put those benefits in jeopardy. In fact, the recently released Trustees Report reveals that Social Security recipients could see as much as a 20% reduction in benefits once the program's trust funds supplementing its income run dry. And if you're wondering when that will happen, the latest estimate is 2035 -- a mere 16 years down the road.

Believe it or not, however, all of this is actually good news compared to what the Trustees Report had to say in 2018. Then, we were warned that 2034 would be the year the aforementioned trust funds run dry, not 2035, so it looks like that unwanted milestone has been pushed off by a year. Furthermore, last year, the anticipated reduction in benefits resulting from the trust fund's depletion was 21%. This year's report scales that reduction down to 20%, which is a modest, but critical, improvement.

Social Security card on white background.


Still, it's hard to ignore the fact that Social Security is, to a large degree, in trouble. And it's on working Americans to account for that in their retirement planning and save enough to make up for it.

Don't count on Social Security alone

An estimated 21% of married seniors and 44% of unmarried seniors today rely on Social Security to provide 90% or more of their income. And these are the very same people who stand to get hurt if Social Security is forced to slash benefits in the future. To avoid falling victim to a similar fate down the line, you'll need to do one key thing: Save aggressively for retirement during your career.

The good news is that if you're many years away from retirement, you can establish a solid nest egg without having to part with too much income on an ongoing basis. Here's an example of the wealth you might build by setting aside various contributions over a 30-year period:

Monthly Savings Amount

Total Accumulated Over 30 Years at an Average Annual 7% Return










$1.13 million


It should go without saying that setting aside $200 or $400 a month will be much easier than parting with, say, $1,000. The point, however, is that you have an opportunity to build substantial wealth so that a cut in Social Security benefits doesn't destroy your retirement. (And if you're wondering about the 7% return above, know that it's a few percentage points below the stock market's average. In other words, it's a reasonable number to work with.)

Where will that money to save come from? You might cut some expenses in your budget to free it up, whether it means downsizing to a smaller living space or eating out much less frequently. Or you might consider getting yourself a side job until your earnings from your main job pick up. In fact, millions of Americans today have a second source of income, and 14% of folks with a side hustle do so for the express purpose of saving for retirement. The key, either way, is to build your own nest egg so that Social Security plays less of a role in dictating your future finances.

Incidentally, Social Security was never designed to sustain seniors by itself in the first place. Even without a reduction in benefits, it will generally replace just 40% of the average worker's pre-retirement income. Most seniors, however, need roughly double that amount to live comfortably, so even if Congress steps in with a fix that saves future benefits from getting slashed, that still doesn't let you off the hook from saving independently. Rather, you'll need to make a serious effort if you want to enjoy your golden years.