U.S. Social Security shortfall points to average $500 monthly benefit cut

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Social Security benefit cut

Highlights

Social Security trust fund may be depleted in 2032, triggering a 24% benefit cut and an average $500 monthly reduction for retirees if no policy changes occur.
In 29 states, average monthly Social Security benefit cuts would exceed $500, with Connecticut facing the highest reduction at $556, followed closely by New Jersey and New Hampshire.
A projected 63 million beneficiaries—including 54 million retired workers and 9 million on survivor or dependent benefits—would be affected, impacting 10–23% of state populations nationally.

Projected cuts and state-by-state exposure

As reported by Committee for a Responsible Federal Budget, current Social Security Administration estimates from August show the trust fund used to support retirement benefits may be depleted in 2032, triggering a 24% reduction in benefits if no policy changes are made. The annual 2026 Social Security trustees report, which updates those projections, is expected in June.

In its new report, the fiscal policy group says an immediate 24% cut would equal an average monthly reduction of $500 for retirees. In 29 states, the average monthly decline would be higher than that national figure.

Connecticut would face the largest average monthly cut at $556, followed by New Jersey at $554, New Hampshire at $553, Delaware at $549 and Maryland at $541. Washington, Minnesota, Massachusetts, Michigan and Utah also rank among the 10 states with the largest average monthly reductions, with cuts ranging from $523 to $531.

Retiree impact across the U.S.

A total of 63 million current beneficiaries would be affected by the projected reduction to Social Security’s retirement program, according to the analysis. That includes 54 million retired workers and 9 million people receiving survivor or dependent benefits.

Nationwide, an average of 17.7% of the population would be touched by the benefit cuts, the report says. Across states, the share of residents affected ranges from 10% to 23%, underscoring how the financing gap could have uneven effects on household income and local economies.

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