A GOP Senator Said Social Security ‘Really Has a Problem’ - Here’s What a 20% Cut Would Mean for Your Check

Warnings about Social Security can be easy to tune out after hearing them for years, but the latest one comes with a deadline that's getting closer. Sen. Bill Cassidy of Louisiana recently pointed to the program's shrinking financial cushion as he urged Congress to deal with the shortfall before retirees feel the effects.

Cassidy was reacting to the latest Trustees Report, which projects that scheduled benefits could eventually be cut by about a fifth if lawmakers don't act. For you, that could mean hundreds of dollars missing from your monthly check and a much tougher path toward your retirement goals.

Here's what's behind the warning and how much could be at stake.

What Sen. Bill Cassidy said about Social Security's funding crisis

Cassidy told reporters that Social Security really has a problem, pointing to the latest actuarial report as fresh evidence of how serious the funding shortfall has become. "The longer you wait to fix Social Security, the worse it gets," he said, arguing that continued delays will only make the eventual solution harder.

He has already spent six years working on the issue, and his time in the Senate is almost up. After losing his Republican primary, Cassidy is set to leave office at the end of 2026, giving him only a few months to make further progress. The fact that lawmakers are still trying to agree on what to do, he said, "shows you how difficult it is."

What a 22% Social Security cut could mean for your check

The retirement trust fund is projected to run low on reserves in late 2032, and while Social Security wouldn't disappear, the payroll taxes still coming in would cover only about 78% of scheduled benefits. If Congress hasn't acted by then, retirees could face a cut of roughly 22%.

For the average retired worker receiving about $2,088 a month, that would mean losing roughly $460 and watching the monthly check fall to about $1,630.

Cassidy's office estimates that cuts this large could leave more than 3 million additional older Americans and people with disabilities living in poverty. For retirees who are already getting by on a tight budget, losing a few hundred dollars a month could be enough to push them below the poverty line.

How the PROMISE Act could help address Social Security's funding shortfall

Cassidy has teamed up with Democratic Sen. Dick Durbin of Illinois on the PROMISE Act, which would create a formal process for Congress to work on Social Security's finances. The bill itself wouldn't raise taxes or reduce benefits. Instead, it would require lawmakers to sit down and vote on a repair plan rather than kicking the problem further down the road.

An independent board would develop a proposal designed to keep Social Security solvent for at least 50 years, and Congress would then have to debate it and bring it up for a vote.

According to the Bipartisan Policy Center, about 67% of Americans want Congress to address Social Security sooner rather than later. The PROMISE Act is one attempt to get that process moving without deciding in advance what the eventual fix should be.

What solutions could prevent Social Security benefit cuts?

Two ideas come up often when lawmakers talk about closing Social Security's funding gap:

• Raise the cap on taxed wages: In 2026, Social Security payroll taxes apply only to the first $184,500 you earn. Wages above that amount aren't taxed for Social Security. Raising or removing the cap would bring in more money from higher earners while leaving most workers' payroll taxes unchanged.
• Raise the full retirement age: It is already 67 for anyone born in 1960 or later. Moving it higher would reduce lifetime benefits because you'd either have to wait longer for your full benefit or accept a larger reduction for claiming earlier.

These two approaches would affect people very differently depending on their income and retirement plans, which is why any final deal would likely involve a long debate over who pays more and who receives less.

How to plan for a smaller Social Security check before 2032

Late 2032 may sound far away, but if you're in your late 50s or early 60s, you could already be collecting Social Security by then. Any benefit cuts could affect your monthly check even if you've been retired for years, so it's worth checking how your budget would hold up while you still have time to make changes.

You can start by looking at your own Social Security numbers and what a smaller check would mean for your retirement plan:

• Check your benefit estimate in your my Social Security account at SSA.gov.
• Test your retirement budget using 78% of that estimate to see where you might come up short.
• Think about when to claim, since waiting longer can raise your monthly benefit even though a future percentage cut would still apply.
• Build up your savings if you can so you have another source of money to cover part of any future gap.

Cassidy wants lawmakers to move before the shortfall gets worse, and you can use that same window to make sure your retirement plan is ready for either outcome.

Bottom line

The warning from the outgoing Louisiana senator doesn't mean your Social Security check is about to disappear, and Congress still has time to address the shortfall before 2032. What happens next is still unsettled, which makes it hard to know exactly how future senior benefits could change.

For now, it's worth checking up on your retirement readiness with a possible cut in mind. A little extra savings or flexibility around your retirement date could give you more room to adjust if Social Security eventually pays less than you expected.

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