Ashley Grahm
Millions of Americans nearing retirement may face a financial shock. According to the latest estimates, two-income retired couples could lose up to $18,100 per year in Social Security benefits starting in 2033.
This potential 24% cut is due to the projected depletion of the Old-Age and Survivors Insurance (OASI) Trust Fund, the main funding source for Social Security retirement benefits.
With the retired population growing faster than the working population contributing to the system, the Social Security Administration will soon only be able to pay out what it receives in tax revenues—significantly less than full scheduled benefits.
Why Are Social Security Cuts Expected in 2033?
The OASI Trust Fund is funded primarily through payroll taxes. However, by late 2032, the fund is expected to be exhausted.
Once depleted, benefits will be reduced to match incoming payroll tax revenues, resulting in a 24% cut in average benefits.
This means that by 2033:
- A dual-earner retired couple may lose an estimated $18,100 per year.
- A single-earner couple may lose about $13,600 annually.
- A low-income dual-earner couple could see a cut of $11,000 per year.
- A high-income couple could face reductions of nearly $24,000 per year.
While high earners may lose more in absolute dollars, lower-income retirees will suffer more relative to their total income, making the cuts harder to absorb.
Estimated Annual Social Security Cuts in 2033
| Household Type | Estimated Annual Benefit Cut |
|---|---|
| Dual-Earner Couple | $18,100 |
| Single-Earner Couple | $13,600 |
| Low-Income Dual-Earner Couple | $11,000 |
| High-Income Couple | $24,000 |
These figures reflect nominal values, meaning they are not adjusted for inflation—real impact could be even higher.
How Many Americans Could Be Affected?
As of June 2025, nearly 67 million Americans receive some form of Social Security benefit. A recent national survey showed:
- 96% of Americans consider Social Security important
- 66% of retirees rely on it heavily
- Another 21% say they rely on it at least somewhat
Given these numbers, millions of retirees and near-retirees could face reduced financial security in retirement without legislative intervention.
Why the Cuts Could Be Worse Than Expected
The Committee for a Responsible Federal Budget (CRFB) projects a steeper cut than the Social Security Trustees’ 2025 report, which estimated a 23% benefit reduction by 2034.
Why the discrepancy?
- The CRFB’s forecast includes the fiscal impact of the One Big Beautiful Bill Act (OBBBA) passed in July 2025.
- OBBBA reduces revenue by cutting taxes and increasing the senior standard deduction, reducing the taxable portion of Social Security benefits.
If these provisions become permanent, the cuts could exceed 24%.
What Can Be Done to Avoid Cuts?
Congress will need to take action before 2033 to prevent these benefit reductions. Options include:
- Raising payroll taxes to increase revenue
- Raising the full retirement age to delay benefit claims
- Removing the payroll tax income cap
- Reducing benefits for high-income earners
Policymakers may have to adopt a combination of these measures to keep the system solvent and protect full benefits for future retirees.
The potential $18,100 cut in annual benefits for two-income couples retiring in 2033 is a stark warning.
Without swift and effective action from Congress, millions of Americans may face unexpected financial hardship in retirement.
As debates around Social Security reform heat up, it’s essential for all future retirees to stay informed, plan ahead, and push for policy solutions that ensure long-term benefit security.
FAQs
Why is Social Security facing cuts in 2033?
Because the OASI Trust Fund will be depleted by 2032, benefits will only be paid from payroll taxes, resulting in a 24% average cut.
Who will be affected most by these cuts?
Lower-income and dual-earner couples may feel the impact more, as Social Security makes up a larger portion of their retirement income.
Is Congress likely to prevent these cuts?
While no definitive action has been taken yet, pressure is mounting on lawmakers to implement changes before 2033 to avoid sharp reductions.