Congressional Budget Office Projects Social Security Retirement Fund Insolvency by Mid-2032
The Congressional Budget Office (CBO) projects that Social Security's retirement trust fund will become insolvent by mid-2032. This projection aligns with the Social Security Trustees' own estimates. Upon insolvency, the CBO anticipates a significant 26% cut in benefits for retirees, a reduction that is expected to increase to 40% by the end of the century. The CBO also estimates a long-term shortfall of 1.6% of Gross Domestic Product (GDP) or 4.6% of taxable payroll over the next 75 years. This looming insolvency is attributed to a fundamental imbalance between the program's growing costs and stagnant revenues. Social Security's costs have risen from 10.7% of taxable payroll in 1990 to 15.0% today, and are projected to reach 21.0% by the end of the century, while revenues have only marginally increased from 12.7% to 12.9% of payroll in the same period.
