Grim new Social Security outlook revealed as checks set to shrink by huge sums

Daily Mail​

4 days ago

Social Security's retirement fund is set to run short in just seven years — which could end up slashing benefits for millions of Americans by thousands of dollars a year.
According to latest projections, retirees could face automatic 24 percent benefit cuts as early as the end of 2032.
This means a couple who both worked would receive $18,100 less each year if they retire at the start of 2033.
The new forecast from the nonpartisan Committee for a Responsible Federal Budget (CRFB), released Thursday, moves up the insolvency date for both Social Security and Medicare trust funds.
A projection just last month had funds lasting until 2033, but that has already been revised. A major factor is the impact of President Donald Trump's 'Big, Beautiful Bill ', which experts warned would speed up the use of funds.
Social Security relies on its trust fund to provide monthly benefit checks to around 70 million Americans.
Once the reserves are exhausted, federal law requires that benefits be cut to match incoming revenues.
This means payments will continue, but at reduced levels. The cuts would also grow over time as scheduled benefits continue to outpace dedicated revenues, the CRFB said.
By 2099, the size of the benefit cut would grow to well over 30 percent, the nonpartisan committee said.
Depending on a couple's age, marital status and work history, the actual size of the benefit cut would vary.
For example, the average single-earner couple would face a $13,600 cut in late 2032, while a dual-earner low-income couple would face an $11,000 annual cut.
High-income couples could see a cut of closer to $24,000.
While the absolute size of the cut would be smaller for a typical low-income couple than for a high-income couple, it would represent a larger share of their income and their past earnings, the CRFB said.
The depletion of Social Security's trust funds would also be compounded by the insolvency of a Medicare trust fund.
The hospital insurance trust fund, which is also known as Part A of Medicare, finances health care services related to hospital stays and skilled nursing facilities for eligible beneficiaries, which is mostly those aged 65 and over.
This fund is also projected to be exhausted in late 2032, cutting payments by 11 percent.
The forecast predicts that a dual-earning couple who retire at the start of 2033 would receive $18,100 less a year in vital benefits
The latest CRFB estimates of potential benefit cuts are somewhat larger than those put forward in the most recent Trustees' report from June.
The committee blamed changes brought in by the Trump administration's 'Big, Beautiful Bill.'
Despite facing bipartisan criticism, the bill was signed into law earlier this month.
It extends most of the tax cuts Trump signed into law in 2017, including slashing rates on estates and for corporations. Deductions for state and local taxes, as well as business owners, are included.
The CRFB said the tax rate cuts and the increase in the senior standard deduction from the bill would reduce Social Security's revenue from the income taxation of benefits, increasing the required cut by about a percentage point upon insolvency.
It warned if the senior standard deduction and other temporary measures are made permanent, the benefit cut would grow larger, hurting millions of Americans.
'Policymakers pledging not to touch Social Security are implicitly endorsing these deep benefit cuts for 62 million retirees in 2032 and beyond,' the committee added.
'It is time for policymakers to tell the truth about the program's finances and to pursue trust fund solutions to head off insolvency and improve the program for current and future generations.'