Social Security is a lifeline for millions of Americans, particularly retirees who utilize the checks to get by. However, there’s a crisis looming. The program is depleting its funds at a faster rate than anticipated, and if something doesn’t change, benefits may be cut in as soon as a decade.
Thankfully, proposals are on the table, and if Donald Trump is reelected, these four significant reforms could very well address the problem without cutting off your check.
The alternative: The Social Security trust fund clock is ticking
Now, Social Security is spending more rapidly than it’s receiving revenue. That’s because there are more retirees collecting benefits than workers are paying in via payroll taxes. The Social Security trust fund will run out in 2034, according to the Congressional Budget Office. Once that’s exhausted, benefits could be cut by about 23% starting in 2035 — unless Congress intervenes.
But there is hope on the horizon. If lawmakers move quickly, there are solutions to prevent these draconian cuts. Let’s look at four solutions that would fill the gap without inflicting pain on most Americans.
1. Tax earnings over $400,000
Only earnings up to $176,100 are taxed into Social Security in 2025. That is, a person earning $180,000 and a person earning $1 million make the same salary in the same system.
A genius solution? Start taxing income above $400,000. The University of Maryland calculates that this modification alone would eradicate 60% of Social Security’s 75-year actuarial shortfall. It’s a modification that would impact mostly high-income, not lower- or middle-income workers.
2. Gradually increase the payroll tax rate
Now you and your employer each pay 6.2% of your income into Social Security. A modest, gradual rise to 6.5% for six years — a paltry 0.05% annually — would be revolutionary.
It would pay for 15% of the long-term deficit and phase the expense over the years, which is less painful to workers and companies.
3. Raise the full retirement age to 68
Right now, the full retirement age is 67 for people born in 1960 or later. That’s when you’re eligible to get your full Social Security benefit. But gradually raising that age to 68 by 2033 could save money in the long run.
Once more, this would have zero effect on people approaching retirement age today. But for younger workers, waiting a few years and claiming full benefits could just keep the system affordable in the future and close 15% of the funding gap.
4. Cut benefits for the highest-paying retirees
Social Security benefits are determined by your lifetime earnings. Affluent retirees today get full benefits. But one option to make the sting less objectionable is to trim payments slightly for the richest 20%.
It would exempt the majority of Americans and would eliminate the funding deficit by around 11%—without slashing checks for the majority.
A complete solution without cutting your check
Together, these four reforms could completely erase Social Security’s $23 trillion shortfall. That’s no across-the-board reductions in 2035 — and more financial security for retirees like you.
If enacted, these proposals could secure the Social Security system for generations to come and safeguard your hard-earned benefits.
If you want to know more, here are some articles to check out later:
One Social Security change every worker should make in 2025 to increase their benefits in the future
Will creating a my Social Security account affect my credit score or credit report?
