Social Security retirement trust fund projected to be depleted, triggering an automatic 28% benefit cut for all retirees

CBO projects the Social Security Old-Age and Survivors Insurance (OASI) trust fund will exhaust its reserves in fiscal year 2032, one year earlier than estimated in 2025. At that point, Social Security can only pay benefits equal to incoming payroll tax revenue — roughly 72 cents on the dollar — resulting in an automatic across-the-board cut of approximately 28% for all beneficiaries regardless of age or income. The 2025 Trustees Report put the combined trust fund exhaustion date at 2034, while CBO estimated 2032 for the retirement fund alone. The One Big Beautiful Bill Act accelerated both dates by reducing revenue flowing into the trust funds through its senior deduction provision. In 2026, Social Security faces an annual cash deficit of $250 billion. Without reform, the shortfall grows to $478 billion by 2035.