Uncertainty is a natural part of the retirement planning process. You can't predict how long you'll live or how much you'll spend annually. But at least in the past, retirees have been able to count on regular Social Security checks to cover a large chunk of their living expenses.
That's not necessarily the case for today's workers and seniors. While Social Security is not going away, it is heading toward a funding shortfall, and there's no current plan to fix it. That's already tough to hear, but a new Congressional Budget Office (CBO) report has revealed that the situation may be a little worse than we previously thought.
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Social Security's trust funds are slated to run out sooner than expected
Social Security stays afloat thanks to income from Social Security payroll taxes and benefit taxes. It also has trust funds, built up in past years when the program had more income than expenses. However, when expenses began exceeding non-interest income in 2010, the government had to begin tapping the trust funds to make up for the shortfall.
The latest Trustees Report, issued in June 2025, indicated that the Old Age and Survivors Insurance (OASI) trust fund, which pays for retirement and spousal benefits, would be depleted in 2033. However, a CBO report from February 2026 estimates that the depletion date has now advanced to 2032.
In both cases, the reports note that, if the government were to combine the OASI trust fund with the Disability Insurance (DI) trust fund, which pays benefits to disabled workers and their families, Social Security would have a bit more time before facing cuts. The CBO report says that, combined, the trust funds could keep the program running as usual until 2033.
After that point, it would face benefit cuts unless the government intervenes. It did exactly that the last time Social Security faced a funding crisis in the 1980s, so it's likely to happen again. But right now, there aren't any concrete plans for the program's future.
What this means for workers and retirees
The only way to avoid Social Security benefit cuts is to increase the program's income. That will likely mean raising taxes. While some suggestions, like raising or eliminating the ceiling on Social Security payroll taxes, would primarily affect the wealthy, ordinary Americans will probably have to shoulder some of the burden.
This could make it more difficult to save for retirement, and, if benefit taxes increase, you may hold on to less of your checks as well. This is why it's critical to save as much as you can for retirement on your own. The more savings you have, the better you'll be able to weather whatever comes next.
It'll also be important to keep a close eye on Social Security as it nears the 2032 deadline. Once the government has a plan to ensure its solvency for future generations, it'll be time for everyone to revisit their retirement strategy to see what needs changing.
