A new analysis warns that if Social Security’s trust fund runs out in under seven years, benefits could fall by about 24%, averaging roughly $500 per month nationwide. The report estimates nearly 70 million Americans could be affected, with sharp differences a
By the time Social Security trustees run out of time, the change may look like a number on a check. But for tens of millions of people, it would mean fewer dollars to cover groceries, rent, prescriptions, and everything else that depends on a steady monthly payment.
A new analysis warns that Social Security beneficiaries could lose an average of about $500 per month if the program’s trust fund is depleted in less than seven years. The estimate is tied to the Social Security Trustees’ projection that. without changes. the retirement trust fund will be exhausted in 2032.
The stakes are enormous. Social Security spending amounts to roughly $1.5 trillion annually, and over the past 16 years the cost of the retirement program has exceeded the amount collected through payroll taxes. That shortfall has been covered by dipping into trust fund reserves.
With the trust fund running out, everyone’s benefits could see a 24% decline, according to the Committee for a Responsible Budget. Nationally, the group estimates that translates into the $500 average monthly loss.
The report’s comparison is blunt: the average retired household’s grocery spending each month is lower than that hit. Households with someone over 65 spent an average of $5. 251 on food at home in 2024—about $438 per month—according to the 2024 Consumer Expenditure Survey. Adjusted for inflation, that monthly figure would equal $461 in 2026, the CRFB said.
“No state would be spared from the potentially devastating effects of insolvency,” the CRFB warned.
Almost one in five Americans depends on it
Social Security benefits reach nearly 70 million Americans—about one in five people—covering retirees as well as surviving spouses and dependents.
The impact would not be evenly distributed. CRFB estimates that between 10% and 23% of each state’s population could be affected by benefits cuts.
In 29 states, beneficiaries would face a reduction deeper than the national average $500 per month, the report said.
CRFB’s list of the biggest dollar losses by state starts with Connecticut at $556, followed by New Jersey at $554 and New Hampshire at $553. Delaware is next at $549. Maryland ($541) and Washington ($531) come after, along with Minnesota ($530) and Massachusetts ($527).
The report also puts Michigan and Utah in the upper tier of losses. Michigan is estimated at $523, while Utah is also projected at $523.
States where the share of people hit is highest
For states where the proportion of residents facing cuts is expected to be the most severe, the CRFB estimates highest percentages at:
Maine at 22.9%, West Virginia at 22.4%, and Vermont at 22.0%. Delaware is next at 21.1%, followed by Montana at 21.0% and New Hampshire at 21.0%.
The group also lists South Carolina at 20.6% and Wisconsin at 20.2%. Michigan is estimated at 19.8%, and Pennsylvania is also at 19.8%.
That mix of totals and percentages shows the challenge for policymakers: even if the national average looks like a single headline number, the distribution across states would be uneven.
Economic ripple effects could reach hundreds of billions
The CRFB also estimates the broader economic drag if benefits were cut by 24% today. Nationally, that would amount to $345 billion this year—about 1.1% of gross domestic product.
At the state level, impacts would range from 0.2% to 1.9% of GDP. The report says cuts would exceed 1% of GDP in 40 states.
The analysis points to demographic and income differences as a driver of why some places would feel the hit harder. States with older populations and lower per-person incomes would be impacted the most, the CRFB said.
The top 10 states most affected by the GDP share include West Virginia at 1.9%, Mississippi at 1.8%, Vermont at 1.8%, and South Carolina at 1.7%. Maine is also at 1.7%, while Michigan is listed at 1.6%.
Montana and Arkansas are both projected at 1.6%. Alabama is also at 1.6%, and Idaho is at 1.5%.
The window for changes is tightening
The CRFB’s message is tied to timing: with less than seven years until Social Security is projected to become insolvent, policymakers would need to enact changes quickly to reduce the likelihood of cuts like the ones outlined in the analysis.
The trust fund’s projected path—exhaustion in 2032—adds urgency to decisions that determine whether today’s benefits schedule can survive the demographic shift threatening the program’s finances.
In other words, the arithmetic is moving toward a moment when the question won’t be whether benefits decline, but how much, and how fast—and which states and households will pay the price first.
Social Security benefits cuts trust fund insolvency retirement program Committee for a Responsible Budget CRFB 2032 US economy state impacts