We estimate that this would be equal to an $18,100 annual benefit cut for a dual-earning couple retiring at the start of 2033 – shortly after trust fund insolvency. At the same time, those retirees might experience reduced access to health care due to an 11 percent cut in Medicare Hospital Insurance payments. The cuts would grow over time as scheduled benefits continue to outpace dedicated revenues.

Depending on a couple’s age, marital status, and work history, the actual size of the benefit cut would vary. For example, a typical single-earner couple would face a $13,600 cut, 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. These cuts are in nominal dollars and would be 15 percent smaller in 2025 dollars. 

The gap between Social Security’s costs and revenue is expected to grow and, as a result, lead to deeper automatic benefit cuts over time. By 2099, the size of the required benefit cut would grow to well over 30 percent. 

Importantly, these estimates are somewhat larger than those implied by the most recent Trustees’ report. That’s because the tax rate cuts and increase in the senior standard deduction from the recently enacted OBBBA would reduce Social Security’s revenue from the income taxation of benefits, increasing the required cut by about a percentage point upon insolvency. If the expanded senior standard deduction and other temporary measures of OBBBA are made permanent, the benefit cut would grow larger. 

Policymakers pledging not to touch Social Security are implicitly endorsing these deep benefit cuts for 62 million retirees in 2032 and beyond. 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.