‘Increasing the retirement age by one year each year through 2033 is an essential change’
SCHAUMBURG, IL (June 11, 2026) – The Social Security Administration just announced that the retirement trust fund will run out of money in late 2032. The government will no longer be able to pay retirees their full promised benefits at that time.
The deadline has been moving steadily closer to the present as projected revenues continue to fall short of expectations. The Medicare trust fund will run out of money in 2033, as well.
This is a crisis for retirees, prospective retirees, taxpayers, the government, and the U.S. economy. When the trust fund runs out of money six years from now, the projected income from payroll taxes will cover only 78 percent of promised benefits. The government will have to borrow more money, reduce benefits, raise taxes, and/or extend the retirement age. All those options would be inflationary, recessionary, or both.
The following quotes, provided by a Heartland Institute expert on taxes, spending, and the economy, can be used for attribution.
If you’d like to interview a Heartland Institute expert on this topic or other topics, please contact Donald Kendal, the director of the Glenn C. Haskins Emerging Issues Center at [email protected], or contact Director of Communications Jim Lakely at [email protected]. You can also call/text Jim at 312-731-9364.
“The draining of the Social Security trust fund is a short-term crisis that has arisen from a long-term problem.
“The program’s trustees said revenues are less than expected because of last year’s reduction of the tax on Social Security benefits, plus declining fertility rates and lower immigration. The real cause of the problem is the aging of the nation’s population, as our working people have to support a rising number of retirees. That is not going to change, yet Congress and presidents have refused to confront the truth.
“A crash of the Social Security system could plunge millions of people into poverty, cripple the nation’s economy, destroy the federal government’s ability to borrow money, and spark massive social disorder and political disarray.
“Financing retirement requires just one thing: saving. The federal government has been borrowing against the Social Security trust fund for years, spending it on current largesse to buy votes from various population groups. A massive reduction of federal spending on items other than Social Security and Medicare could reduce or eliminate the shortfall. That, however, seems politically impossible.
“In the meantime, the only way to avert a Social Security doom spiral is for the government to patch the entire entitlement system right now by reducing Social Security benefits, increasing economic growth through lower tax rates and less regulation, and cutting spending significantly on other entitlement programs and national security ‘wants’ as opposed to needs. The revelations of astonishing levels of fraud in social programs provide a strong political opportunity for reform.
“Probably the simplest and least disruptive approach at this point would be to extend the minimum retirement age. The average American now lives to the age of 77 and becomes eligible for minimum Social Security benefits at age 62 and full benefits at 67. In 1935, the average American who reached adulthood could expect to live to around 65 years, the minimum age for Social Security benefits at the time.
“Increasing the retirement age by one year each year through 2033 is an essential change, even if unfortunate and jarring for those who are expecting to retire soon. It would add workers and decrease costs.
“The federal government has known for many years that the retirement system is unsustainable. The trustees’ report is just another reminder of this reality.”
S. T. Karnick
Senior Fellow
The Heartland Institute
[email protected]
The Glenn C. Haskins Emerging Issues Center serves as the “tip of the spear” in identifying and confronting the underreported challenges that threaten American sovereignty, individual liberty, and free-market capitalism. The EIC brings these emerging threats to the forefront of public and political awareness, empowering citizens and policymakers alike to act in defense of freedom and a thriving free-market society.
S. T. Karnick is a senior fellow and director of publications for The Heartland Institute.
