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A new report from a respected budget watchdog landed this month with a scary headline: when Social Security’s trust fund runs dry, every retiree’s check gets cut by about 24% (1). For the average beneficiary, that’s roughly $500 a month — more than many seniors spend on groceries (1).
I’ve been a CPA since 1981, and I’ve watched Washington wave this same red flag since the 1983 rescue that saved the system. So let me tell you what today’s headlines leave out.
First, Social Security scares are nothing new. I was a Wall Street investment advisor throughout the 1980s, and even then securities sales folks were trotting out the Social-Security-Is-Going-Broke routine. It was never a lie: Social Security has had problems for decades. And investment advisors and headline writers have been using it to scare people for decades.
So here’s the truth: while the problems are real, the headlines can make it seem scarier than it is.
Social Security’s trustees say the retirement fund won’t be depleted until 2033 — and even then, payroll taxes would still cover about 77% of scheduled benefits (2). “Insolvent” has never meant “broke.”
That steeper 24% figure comes from a watchdog using a newer estimate that pulls depletion into late 2032, after 2025’s tax cuts trimmed the program’s revenue (1)(3). The official 2026 trustees report, due this month, will reset the clock yet again.
Either way — 2032 or 2033, a 23% or 24% trim — the average $2,000 monthly check (4) doesn’t disappear. It shrinks. That’s a real problem worth planning around, not the apocalypse the panic-merchants are selling. Here are six moves I’d make right now — none of which involve dumping your savings into something you’ll regret.
1. Understand what ‘insolvent’ actually means
Start here, because the whole panic rests on a word people misread. “Insolvent” doesn’t mean Social Security stops paying. It means the surplus runs out and the program can only pay what payroll taxes bring in.
That’s roughly 77% of scheduled benefits (2) — a real cut, but not zero. The CBO figures the shortfall could deepen over time, with estimates landing in the 23% to 28% range (5).
And the date is a moving target. The official trustees report still says 2033; the newer watchdog math says 2032 (1). Congress has patched this system before — most famously in 1983 — and has years to do it again. And they almost certainly will.
2. Don’t let fear pick your claiming age
Here’s the move that actually costs people money: panic-claiming at 62 to “get mine before it’s gone.”
Think about what that does. To dodge a possible 24% cut years from now, you’d lock in a guaranteed cut today. Claim at 62 with a full retirement age of 67 and you get about 70% of your benefit — a 30% reduction, permanently (2).
Wait, and the math flips. The SSA adds roughly 8% a year for every year you delay past full retirement age, up to 70 (2). For couples, it often pays for the higher earner to wait while the lower earner claims earlier. The right age is more nuanced than “grab it early” — I’ve walked through the trade-offs before.
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3. Get your own number — averages don’t pay your bills
Every scary headline quotes a national average. Your retirement doesn’t run on averages — it runs on your number.
So find it. Create a My Social Security account at SSA.gov and pull your earnings record. A single error in that record can quietly shrink your check for the rest of your life, so check it for accuracy.
While you’re at it, there are a handful of boxes worth checking before you ever file. Knowing your real benefit turns a vague fear into a number you can plan around.
Quick aside — most internet financial advice comes from people who weren’t alive during the last recession. I’ve been writing about money for more than 35 years. Want rock-solid advice? Sign up for the free Money Talks Newsletter. Takes 10 seconds. No fluff. No spam.
4. Build income you actually control
Notice what every one of these fixes has in common: control. You can’t vote yourself a bigger Social Security check, but you can build income around it that no act of Congress can touch.
For example, the laziest win available — where you park your cash. Tens of millions of people leave savings at big banks earning next to nothing while inflation chips away at it.
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5. If you’re house-rich but cash-short, know your options
A lot of retirees who’d feel a benefit cut are sitting on a paid-off house and a thin bank account. If that’s you, your home equity is one possible backstop.
I’ll be straight: I’m not a fan of these for everyone. They’re costly and complex, and they’re wrong for plenty of people. But for a homeowner who wants to stay put and needs income, it’s an option worth understanding before you rule it out.
If you’re 62 or older, the equity in your home could become cash you can use now. A reverse mortgage lets eligible homeowners convert part of their home equity into funds — while keeping ownership of their home.
What it could help you do:
Free up your monthly budget with no required monthly mortgage payment*
Cover everyday expenses or build an emergency cushion
Make home improvements
Fund the retirement lifestyle you want
See how a reverse mortgage works and whether you qualify.
6. Protect — and stretch — every dollar
If your check does shrink, every dollar has to work harder. And here’s an ugly truth: scammers track these headlines too. Fake “benefit suspension” and “clawback” threats are among the most common scams aimed at retirees right now.
So tighten the screws on everyday costs and guard the benefits you’ve got.
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The bottom line
The sky isn’t falling. Social Security has been “going broke” for my entire career, and every time, Congress has patched it at the last minute — usually with some mix of higher taxes, a higher retirement age, and smaller benefits for higher earners. They’ll almost certainly do it again, because letting the system fail is political suicide.
That doesn’t mean do nothing. It means plan from facts instead of fear. Know your number, claim with a strategy, build income you control, and tune out anyone using 2032 to scare you into a product you don’t need.
In short, plan well enough that you can stop refreshing the headlines — and get back to enjoying the part of retirement that actually counts.
Sources: Committee for a Responsible Federal Budget (1); Social Security Administration (2); CBS News (3); CNBC (4); Fortune (5).
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