What the data says about Social Security
Few if any programs of the U.S. government touch as many people as directly as Social Security. Nearly every working American pays Social Security taxes, and more than 55 million people receive retirement benefits through the program. Millions more also collect disability benefits or cash assistance through it.
Social Security has long been one of the federal government’s most popular programs. In a 2024 Pew Research Center survey, 79% of U.S. adults said Social Security benefits shouldn’t be reduced in any way – a view broadly shared across ages, racial and ethnic groups, partisan affiliations and income brackets.
But the program, which marks its 90th anniversary this year, faces multiple challenges. Foremost is a looming cash crunch, as the trust fund that helps pay retirement benefits is forecast to run out by the end of 2033.
The Trump administration also has made deep staff cuts to the Social Security Administration (SSA), the independent agency that manages the program. SSA had 58,409 workers as of September 2024 – more than several federal departments. Those cuts reportedly have left the agency struggling to serve millions of claimants and beneficiaries.
Against this backdrop, here are answers to some common questions about Social Security. Most of our responses (except as noted) were drawn from SSA’s 2024 financial report, its monthly update for April 2025 and the latest report from Social Security’s trustees.
What is Social Security?
Social Security is primarily a source of retirement income. Three-quarters of Social Security recipients are retired workers, and they receive nearly three-quarters of the program’s benefits. But Social Security also pays cash benefits to spouses and children of retired workers; widows, widowers and children of deceased workers; and disabled workers and their spouses and children.
In addition to running Social Security, the SSA administers the Supplemental Security Income (SSI) program for low-income people who are 65 and older, disabled or blind. As of April 2025, more than 7.4 million people got SSI payments; about a third of them also received Social Security.
Several other safety-net programs are authorized by the Social Security Act but aren’t generally thought of as “Social Security,” nor does SSA run them. These programs include Medicare, the federal health insurance program primarilyfor the elderly; Medicaid, the federal/state health insurance program for low-income people; the Children’s Health Insurance Program (CHIP); and unemployment compensation. In this analysis, unless otherwise specified, “Social Security” refers to the social-insurance programs aimed at older Americans, survivors and disabled people.
How is Social Security funded?
Social Security’s main funding source is a dedicated 12.4% payroll tax, half of which is paid by workers and half by employers. Self-employed people pay the entire tax.
Most of that tax revenue – 85.5% – goes to the retirement and survivors’ program, while 14.5% goes toward disability payments.
In 2023, nearly 183 million workers paid into Social Security. That amounted to roughly 93% of the U.S. workforce, outside of certain federal, state and local government workers. (Railroad workers have their own retirement system, though it is coordinated with Social Security.)
About half of Social Security recipients also pay income tax on their benefits. Most of those tax payments – $50.7 billion in calendar year 2023, or 3.8% of Social Security’s total revenue – go back into the system. The rest goes to help fund Medicare.
Social Security also receives interest income from its large holdings of Treasury bonds. All told, the retirement and disability programs took in $1.35 trillion in 2023.
Unlike Social Security, the Supplemental Security Income program is funded through general tax revenues.
How many people receive Social Security benefits?
As of April 2025, 73.9 million people – more than a fifth of the entire U.S. population – got benefits from at least one of Social Security’s programs. That included:
- 52.6 million retired workers
- 2.7 million spouses and children of retired workers
- 5.8 million survivors of deceased workers
- 7.2 million disabled workers
- 1.1 million spouses and children of disabled workers
- 7.4 million receiving Supplemental Security Income
Some people qualify for more than one type of benefit, which is why these figures add up to more than the total number of beneficiaries.
Among older Americans, Social Security comes close to universal coverage. In 2022, 86.9% of people older than 65 received retirement or disability benefits, according to the Census Bureau’s Survey of Income and Program Participation (SIPP). Among people 75 and older, 92.6% received benefits.
How much does Social Security pay out?
In April 2025 alone, Social Security’s 73.9 million beneficiaries received $134.5 billion. The average retired worker received $1,999.97 in benefits that month. Each year, benefit amounts are adjusted for inflation.
In fiscal 2023, the most recent full year with data, Social Security paid out $1.38 trillion in benefits – 22.5% of all federal spending that year. SSI paid out an additional $5.3 billion that year.
How much do people depend on Social Security?
For many recipients, Social Security benefits represent a sizable chunk of their income.
In 2022, Social Security made up at least half of total personal income for 38.3 million people, or 63.2% of adult recipients, according to the SIPP data. For 26.5 million people (43.6% of recipients), it accounted for three-quarters of their income. For 16.4 million (27%), it was their only source of income.
One of Franklin D. Roosevelt’s original goals for Social Security was to “give some measure of protection to the average citizen … against poverty-ridden old age.” As of 2022, 7.8% of Social Security recipients lived in households with income below the federal poverty threshold, compared with 9.7% of nonrecipients.
The picture is different for SSI, which is aimed specifically at lower-income people: A third of SSI recipients live in households whose income is below the poverty threshold.
How are demographic trends affecting Social Security?
The aging U.S. population means that the number of beneficiaries receiving money from the system is growing faster than the number of workers paying into it.
From the beginning, Social Security was designed to be a pay-as-you-go system: The taxes paid by today’s workers fund payments to today’s beneficiaries. (It’s not the case that Social Security operates like a savings plan or an individual retirement account, with benefits representing a return on a worker’s personal “investment.”) That means a key metric of Social Security’s financial health is the ratio between workers and beneficiaries.
The system worked smoothly when there were many workers and relatively few people drawing benefits. In 1965, for example, there were about four times as many workers paying into the system (80.5 million) as beneficiaries (20.2 million).
But as the Baby Boom generation has aged out of the workforce and into retirement, that ratio has steadily fallen. In 2023, the year covered by the most recent trustees’ report, there were just 2.7 workers per beneficiary. By the end of this century, the ratio is projected to decline to 2.1, with 230.7 million workers and 110.4 million people collecting benefits.
What does an aging population mean for Social Security’s finances?
The gap between tax dollars flowing into the system and benefits flowing out is getting wider.
The main issue is with Social Security’s retirement program, whose costs have exceeded its income every year since 2021. The gap, which was $70.4 billion in 2023, is projected to balloon to $414.5 billion in 2033. To pay its promised benefits, the retirement program has begun cashing in the massive stash of U.S. Treasury securities accumulated in a trust fund.
Unlike its retirement program, Social Security’s disability insurance program is projected to remain solvent going forward, while SSI, as mentioned above, is funded from general tax revenues.
How does the Social Security trust fund work?
Concern about Social Security’s viability goes back a long way, especially since the Boomers began shifting from contributors to recipients. A package of major changes enacted in 1983 not only stabilized the system in the short run, but also established a mechanism that was meant to keep it functioning once Baby Boomers started to retire.
Through a combination of tax increases, benefit cuts and rules changes, Social Security began taking in much more money than it needed to pay benefits. This surplus was invested in special-issue Treasury securities, held in two legally distinct trust funds – one for the retirement program and one for the disability program. Interest on the Treasuries is credited to the trust funds.
The retirement trust fund peaked at $2.82 trillion in 2017. Since 2021, Social Security has been redeeming its Treasuries and using the proceeds to bridge the gap between its revenues and its mandated benefits.
What’s the outlook for the Social Security trust fund?
At the end of fiscal 2024, the retirement trust fund was down to about $2.5 trillion. The fund is projected to dwindle over the next several years, but just how quickly depends on the interplay of several economic, demographic and programmatic factors – from fertility and mortality rates to immigration levels and future wage growth.
In the most optimistic scenario, the retirement trust fund would still have nearly $1.3 trillion at the end of 2033. In the most pessimistic one, it will be depleted as soon as 2031. The “intermediate,” or most probable, forecast has the retirement fund running dry sometime in 2033.
Social Security’s trustees predict that the disability trust fund, which stood at $147 billion at the end of 2023, will keep growing into the foreseeable future.
What happens after the retirement trust fund is depleted?
That depends. With no more trust fund resources to draw on – and absent any legislative changes – Social Security would still collect enough tax revenues to pay about 79% of full retirement benefits, under the trustees’ most likely scenario.
Changing the program’s rules could restore its solvency and allow it to pay all of its promised benefits. Those changes could include raising tax rates, subjecting more earnings to the payroll tax, raising the retirement age, reducing benefit levels, or altering how annual cost-of-living raises are calculated.
How do Americans feel about cutting Social Security benefits?
Most don’t like it. In a 2024 Pew Research Center survey, about eight-in-ten U.S. adults opposed the idea. That included 38% who said the program should be kept about as it is and 40% who said it should cover more people with greater benefits.
Upper-income people were most likely to say future benefit reductions need to be considered. Still, only 27% of upper-income Americans said this.