With hopes of avoiding Social Security insolvency, the Trump administration is reportedly evaluating all available options, including raising the retirement age.
“I think everything’s being considered, will be considered,” U.S. Social Security Administration Commissioner Frank Bisignano said on “Mornings with Maria” Thursday.
“Remember, most people told you and I Social Security wasn’t going to be around,” he continued. “And so the generations that are coming in will probably have a different set of rules than we had.”
Social Security’s two main trust funds are projected to reach insolvency on a combined basis in the first quarter of 2034, in part because the ratio of workers to retirees has declined over time from 16.5 workers per retiree in 1950, to 3.3 in 1985, and about 2.8 in 2013, according to Social Security Administration data.
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Once the trust funds are tapped out, the program would face an automatic benefit cut by law to match incoming payroll tax receipts unless Congress reforms the program. Insolvency would leave beneficiaries facing an estimated 24% benefit cut on average, according to an analysis by the nonpartisan Committee for a Responsible Federal Budget.
Social Security’s trustees estimated that Congress would need to raise payroll taxes by 3.65 percentage points — an increase from 12.4% to 16.05% — on a permanent basis to close the program’s 75-year funding shortfall.
When asked by FOX Business’ Maria Bartiromo if raising the retirement age would “save a lot of money” and help policymakers, Bisignano responded that “there’s a whole host of items out there that can be beneficial to get to the answer.”
“It needs, really, to be the trustees, which are the four of us — myself, the Treasury secretary, the labor secretary, the HHS secretary — the White House, which is completely committed to protect and preserve Social Security, and then Congress,” he explained. “And that’s where the real work will happen. And that’ll take a while, but we have plenty of time.”
A recent retirement study from Allianz Life found that retirement confidence is tightening, as only 28% of Americans feel certain in their ability to financially support their life goals, down 13 points since 2020.
Concerns about market volatility and the future of Social Security have also surged among Gen X, and, more significantly, 70% of respondents said they worry more about running out of money in retirement than they do about dying.
Besides raising the retirement age, Bisignano said there’s also talk about lifting the contribution cap.
“That number will continue to increase also, of where the max is, and that’s another thing that people put in the equation to think about,” Bisignano said. “Eight years is a long time away. We’re less than 200 days into this administration, and we need Congress to partner with us.
“The plan was [to] get this to be a great service provider for the American public, and then, with Ways and Means and with [the] Senate, come together with a plan.”
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FOX Business’ Eric Revell contributed to this report.
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