How Secure Is Social Security?
As the politically popular retirement program turns 90, future beneficiaries eye Trump’s budget cutting and wonder, ‘What will be there for me?’
By C.D. Moriarty
A record number of Americans applied for Social Security benefits in the first seven months of the fiscal year, according to the Urban League. The Washington, D.C., think tank said Social Security data shows that applications rose 13% over the same period a year ago.
The jump is less about demographics than the question: Will Social Security be there for me if I wait?
The Congressional Budget Office forecasts that Social Security will spend down its old age trust fund in 2033. This has many Americans panicking, but knowing a bit of history about Social Security and the encompassing benefits can create a helpful perspective.
A Little History of the Program
Ninety years ago, with the United States just beginning to emerge from the Great Depression, President Franklin D. Roosevelt signed into law the Social Security Act of 1935. It created the Federal Old-Age and Survivors Insurance Trust Fund and set up a separate account in the U.S. Treasury to hold money collected through payroll taxes on employers and workers. This idea was to help elderly people in financial straits due to the depression.
Five years later, on Jan. 31, 1940, the first Social Security benefit payment — check number 00-000-001 — was issued to Ida May Fuller, a 65-year-old Vermont schoolteacher and legal secretary. The check was for $22.34, which, when adjusted for inflation, was equivalent to $515 in 2025.
When Social Security was established, the average life expectancy was less than 63. Yet, this retirement program deemed full retirement at 65 years of age, an artificial finish line that contributed to the idea that citizens should leave the workforce at 65.
Adapting to Demographic Change
The economic situation and extended life expectancy have led to changes in the Social Security system. Other demographic changes from the baby boom to the baby bust, and even World War II have impacted the funds available in the Social Security system. The extension of benefits to include children, disabled people and widows have also challenged the system.
More than 40 years ago, there was another Social Security funding crisis, mainly attributed to demographic changes and economic downturn of the 1970s. As a result, Congress passed the Social Security Amendments of 1983. The act raised the full retirement age and increased Social Security taxes. The amendments, signed into law by Ronald Reagan, also began to levy income tax on Social Security benefits for rich people.
What led to the 1983 Social Security solvency crisis? In 1979, the Social Security trustees previously predicted that the program would be solvent through 2032. However, recessions in 1980 and 1981 worsened the program’s finances, leading to the 1983 legislation.
The trustees of the Social Security and Medicare trust funds recently reported that the Old-Age and Survivors Insurance Trust Fund will be able to pay 100% of its scheduled benefits until it exhausts its reserve; at that point, without Congressional action, the fund will pay benefits based only the taxes it receives each year. Trustees estimate the program will pay 79% of scheduled benefits from that point on.
According to experts, we need to rethink the program and create adaptions on a regular 40-year schedule, if not more often. Our government needs to be proactive by revisiting the program changes regularly. That would be better than creating a crisis that panics people.
The average person has no idea how much Social Security does beyond their own post-retirement check. Demographics have an enormous impact on the trust fund. For example, due to older parents and changing demographics, Social Security pays more to support aging Americans who also still have minor children at home. This results in those dependents also collecting a monthly Social Security check until they are 18 or graduate from high school.
According to the Pew Research Center, Americans are marrying more often, which impacts the Social Security system payouts. For example, if a main breadwinner’s first marriage lasted more than 10 years and then that person remarries, both spouses can collect a monthly benefit if the first spouse has not remarried.
This matters because research shows that 29% of people who wed in 2014 had been married at least once before, and 8% had exchanged vows two or more times. The result is in 2024, 10 years later, the number of spouses able to collect Social Security based on one earnings record significantly increases.
The Future of Social Security
Will there be enough money for this program to sustain itself?
“This has happened before,” says Mary Beth Franklin, president of RetirePro, a consultant in Clearwater, Florida, referring to the crisis of the early 1980s. “It is a political problem, not a mathematical problem.”
Franklin, a certified financial planner, adds, “Congress knew how important Social Security is to voters last time. They listen to voters.” In the ‘80s, when Washington last faced warnings that Social Security was living on borrowed time, President Reagan, a Republican, and Democratic leaders in Congress battled over what to do. In the end, they found a middle ground and resolved the problem.
After all, as of April 2025, 73.9 million people — more than one-fifth of the entire U.S. population — got benefits from at least one Social Security program. A Pew Research Center survey last year found that 79% of U.S. adults said Social Security benefits should not be reduced in any way. These are people who also vote. Congress people need to hear from the recipients in the voting booth.
If you fear the system going away, should you take what you can now? This is not an easy yes or no question. Professionals do not always agree, and claiming as early as 62 has long-term consequences.
“Claiming Social Security out of fear results in a cut of up to 30% of your monthly benefit,” Franklin says.
In addition, tax law may require high-income Social Security beneficiaries to pay income tax on their old-age benefits. This depends on the amount of their other sources of income. Be sure to understand the federal and state tax implications of your decision.
What if You Are Still Working?
Another consideration is your earned income. When you collect early — before full retirement age (FRA), which is based on when you were born — you may need to pay back some of the benefits if you earn more than $23,400 a year.
If you reach full retirement age in 2025, the limit on your earnings for the months before full retirement age is $62,160. Planning when to apply for Social Security is important.
“Sometimes it is better to take Social Security at full retirement age even if you are working,” says Lena Mendalis of Alena Wealth in Lexington, Massachusetts. “Yes, it will be a lower amount, and you can use the money to enjoy travel [and other activities] while you are healthy and still interested in these things.”
Needs Versus Wants
Understanding your own needs and income is critical information when choosing whether to take Social Security now or when it maxes out at age 70. If you need it, take it. If it “would be nice,” consider your options.
Remember, that at age 65 you qualify for Medicare, which is a separate, though related government program. You do not need to receive Social Security benefits to apply for Medicare coverage.
Life is different in 2025 than it was in 1935. Remember how much the program has changed — along with quality of life — since Ida May Fuller received the first Social Security check.
What Can You Do?
Here are some proactive steps you can take:
• Do not collect out of fear when necessary. Otherwise, you are locking into a loss.
• Go to Social Security’s My Account website to set up your account and learn more about your potential income. Need money now? You can apply for benefits here.
• Get hard copies of all applications, forms and other documents for your records. The earnings records prove your work history, which affects the amount of your benefit, so review them and keep a copy for yourself.
• Apply for Social Security benefits after you understand all the implications of your decision.
C. D. Moriarty, CFP, is a financial speaker, writer and coach, living in the Green Mountains of Vermont where she is working on a memoir. She can be found at MoneyPeace.com.
This article was previously published online at www.nextavenue.org, a nonprofit, digital journalism publication produced by Twin Cities PBS (TPT).