For years, Social Security’s funding problem sounded far enough away that retirees could reasonably wonder whether Congress would ever do anything about it. That luxury is disappearing: the 2026 Social Security Trustees Report projects that the Old-Age and Survivors Insurance Trust Fund will be able to pay full scheduled benefits only until the fourth quarter of 2032 under current law. At depletion, ongoing income would cover about 78% of scheduled retirement and survivor benefits, although Congress could change the law before then. That doesn’t mean a 22% reduction has been approved or that everyone’s check is scheduled to suddenly fall by exactly that amount, but it does mean lawmakers face increasing pressure to address the shortfall. Under current law and without congressional action, ongoing income would be sufficient to pay about 78% of scheduled OASI benefits after reserve depletion. These six Social Security proposals show how differently Congress could approach the problem and how some ideas could affect retirement checks long before the reserves actually run out.
1. Make Higher Earners Pay Social Security Tax on More Wages
STATUS: Lawmakers developing legislation / related bills introduced
One of the most frequently discussed solutions involves the amount of earnings subject to Social Security payroll taxes. In 2026, workers generally pay Social Security tax only on the first $184,500 of covered earnings, meaning wages above that threshold aren’t subject to the program’s 6.2% employee payroll tax. Senators Elizabeth Warren, D-Mass., and Bernie Moreno, R-Ohio, recently made the unusual bipartisan case for lifting the cap, while other lawmakers have introduced proposals that would restart Social Security taxes once earnings cross a much higher threshold.
Senator Sheldon Whitehouse, D-R.I., and Rep. Brendan Boyle, D-Pa., for example, have backed legislation applying Social Security payroll taxes again to wages above $400,000. Increasing revenue from high earners is likely to remain central to the Social Security proposals debate because it could improve solvency without directly reducing existing retirees’ monthly checks.
2. Increase Benefits While Taxing More High-Income Earnings
STATUS: Proposed legislation, not law
Some lawmakers aren’t merely trying to prevent future benefit reductions. They want to increase benefits now while simultaneously strengthening the program’s finances. Senator Bernie Sanders, I-Vt., and Rep. Val Hoyle, D-Ore., have introduced legislation that would increase Social Security benefits by $2,400 annually while subjecting additional high-income earnings and certain investment income to Social Security taxes.
Their proposal would also change the annual cost-of-living adjustment by using an inflation measure intended to better reflect expenses faced by older Americans. The Social Security Administration’s policy research has separately analyzed CPI-E-based COLAs as one possible policy change and how such a change could affect future beneficiaries. An extra $200 a month would be immediately noticeable to retirees, but proposals pairing benefit increases with higher taxes face a very different political debate from plans focused primarily on restoring solvency.
3. Change How Social Security Calculates Annual COLAs
STATUS: Policy option / included in some legislative proposals
The annual cost-of-living adjustment may sound like a technical detail, but changing it can compound into a significant difference over a long retirement. Social Security currently bases COLAs on the Consumer Price Index for Urban Wage Earners and Clerical Workers, commonly called CPI-W. One recurring proposal is switching to the Consumer Price Index for the Elderly, or CPI-E, which gives different weight to spending patterns experienced by older households.
SSA has modeled both proposals to increase COLAs using CPI-E and proposals that would reduce COLAs by adopting chained CPI, illustrating that lawmakers could move the adjustment in either direction. Among all Social Security proposals, a COLA change is particularly important for younger retirees because even modest annual differences can accumulate substantially over 20 or 30 years.
CPI-W vs. CPI-E vs. Chained CPI
There are essentially three ways COLA could work…
- CPI-W: Current Social Security formula.
- CPI-E: Weights spending patterns of older consumers differently and has often been proposed as a way to increase COLAs over time.
- Chained CPI: Typically grows more slowly and has been discussed as a way to reduce federal benefit growth.
A COLA formula change doesn’t usually create one dramatic check adjustment. Its financial impact compounds over many years.
4. Create a $1.5 Trillion Social Security Investment Fund
STATUS: Legislative proposal, not law
Another proposal takes a dramatically different approach to Social Security financing. Senators Bill Cassidy, R-La., and Tim Kaine, D-Va., have proposed establishing a $1.5 trillion investment fund financed through federal borrowing and investing that money in stocks and other assets over a 75-year period. Cassidy argues that investment returns could eventually cover roughly two-thirds of the additional borrowing otherwise needed to keep full benefits flowing, reducing the size of tax increases or benefit changes required elsewhere. Critics, including the Committee for a Responsible Federal Budget, argue that borrowing enormous sums to invest in financial markets would expose taxpayers to substantial financial risk and wouldn’t by itself restore Social Security’s solvency. The proposal is notable because it illustrates just how unconventional some solutions may become as the 2032 deadline moves closer.
The $1.5 Trillion Investment Idea
When it comes down to it, this investment proposal boils down to two sides.
Supporters argue: Long-term investment returns could generate revenue that reduces how much taxpayers or beneficiaries must absorb elsewhere.
Critics argue: Federal borrowing would increase debt upfront, investment returns aren’t guaranteed, and market risk would ultimately sit with taxpayers.
5. Another Option Congress Has Studied: Raise the Retirement Age
STATUS: Longstanding policy option, but details depend on proposal
Another longstanding idea is gradually increasing Social Security’s retirement ages, although this approach remains politically difficult and isn’t part of every current reform bill. Full retirement age is already gradually reaching 67 for people born in 1960 or later, and increasing it further would effectively reduce lifetime benefits for many future retirees compared with current law. The Congressional Budget Office has examined options that would gradually raise the full retirement age beyond 67 and increase the earliest eligibility age above today’s 62. Supporters argue that longer life expectancy makes a higher retirement age reasonable and could reduce program costs, while critics point out that longevity gains aren’t distributed equally and physically demanding jobs can make working longer unrealistic.
Ultimately, Congress can’t determine when someone stops working. What it can change is the age at which Social Security considers someone entitled to an unreduced retirement benefit.
6. Create a Fast-Track Process for Congress to Produce a Solvency Plan
STATUS: Proposed legislation would create a process, not directly alter checks
Unlike the other ideas on this list, this wouldn’t itself change payroll taxes, retirement ages or monthly benefits. Senators Dick Durbin, D-Ill., and Bill Cassidy have backed legislation directing the bipartisan Social Security Advisory Board to gather public input and develop legislation designed to keep the retirement trust fund solvent for at least 50 years. The resulting legislation would then move through congressional committees and ultimately toward floor consideration under a defined process.
Supporters see the approach as a way to force Congress to confront choices lawmakers have postponed for decades, while AARP has opposed the legislation over concerns about creating a fast-track process for potentially consequential Social Security changes. It wouldn’t directly change anyone’s retirement check on its own, but it could create the mechanism through which several other proposals finally become law.
What Hasn’t Happened With Social Security
With so many Social Security proposals circulating, it’s important to separate ideas under debate from changes that have actually become law. Congress has not approved a 22% across-the-board reduction in retirement checks, eliminated the payroll-tax cap, created a $1.5 trillion Social Security investment fund, or enacted a new higher full retirement age beyond what’s already scheduled under current law.
The 2026 Social Security Trustees project that the OASI Trust Fund can pay full scheduled retirement and survivor benefits until the fourth quarter of 2032, when continuing income would cover about 78% of scheduled benefits if Congress made no changes. That is a financing projection under current law, not an announcement that everyone’s check will automatically fall by exactly 22% in 2032. Likewise, the proposals discussed above remain proposals or policy options unless and until Congress passes legislation and it becomes law.
Should I Claim Social Security Early Because of This?
The approaching trust-fund deadline isn’t, by itself, a reason to rush into claiming Social Security early. Under current rules, starting retirement benefits before full retirement age permanently reduces the monthly amount based on how early you claim, while delaying can increase the monthly benefit through age 70. Someone born in 1960 or later who claims at 62, for example, can receive up to 30% less than the amount available at a full retirement age of 67.
Meanwhile, no one knows which Social Security changes Congress will ultimately adopt or whether future legislation would protect people already receiving benefits or phase changes in by age or birth year. Claiming decisions are therefore better based on factors you can evaluate today, including health, longevity expectations, employment, savings, spousal benefits, cash-flow needs, and the monthly benefit available at different claiming ages, rather than assuming a particular congressional response to the 2032 funding problem.
The Biggest Risk May Be Waiting Until 2032 to Make a Decision
None of these Social Security proposals should be treated as settled law, and retirees shouldn’t change claiming decisions simply because a senator introduced a bill or discussed an idea. What is official is the worsening financial outlook: the 2026 Social Security Trustees Report project OASI reserves will be depleted in the fourth quarter of 2032, while the hypothetical combined retirement and disability funds would reach depletion in the third quarter of 2034. Importantly, Social Security wouldn’t simply disappear at depletion because payroll taxes would continue coming in, but those revenues wouldn’t be enough to pay every scheduled benefit in full under current law. Congress therefore has several broad choices (raise revenue, reduce future costs, use other federal resources, restructure financing, or assemble some combination) and waiting makes the eventual changes more difficult because there is less time for them to take effect gradually.
Which approach would you rather see Congress take to protect Social Security: higher taxes on high earners, changes to future benefits, a new investment strategy, or some combination of those options? Share your thoughts in the comments.
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