The head of the Social Security Administration (SSA), Frank Bisignano, has confirmed that raising the full retirement age is among the options being considered to address the program's long-term financial stability. This comes as official projections show the system's trust funds could be depleted as soon as 2034.
Key Takeaways
- SSA Commissioner Frank Bisignano stated "everything's being considered" to ensure Social Security's solvency, including a potential increase in the retirement age.
- The Social Security Trustees report projects the program's trust funds could be depleted by 2034, which would trigger an automatic 21% reduction in benefits.
- Other potential solutions include raising the cap on earnings subject to Social Security tax and increasing the payroll tax rate.
- The comments have drawn criticism from some lawmakers who equate raising the retirement age to a significant benefit cut for future retirees.
Addressing a Looming Financial Shortfall
During an appearance on Fox's "Mornings with Maria," Social Security Administration Commissioner Frank Bisignano addressed the pressing issue of the program's future solvency. When asked directly if he would consider raising the retirement age, Bisignano responded, "I think everything's being considered."
His comments highlight the significant financial challenge facing the system, which provides benefits to over 70 million Americans. According to the most recent Social Security Trustees report, the combined trust funds for retirement and disability benefits are on track to be depleted by 2034.
If Congress does not act before then, the program would only be able to pay out what it collects in real-time through payroll taxes. This scenario would result in an automatic and immediate benefit reduction of approximately 21 percent for all recipients.
Background on the Solvency Issue
The Social Security system is primarily funded by payroll taxes on current workers. The long-term financial strain is caused by demographic shifts, including lower birth rates and longer life expectancies. As more baby boomers retire and draw benefits, there are fewer workers paying into the system to support them, creating a structural imbalance.
Multiple Solutions on the Table
Bisignano, who was appointed by President Donald Trump, emphasized that a variety of measures are being evaluated. He noted that there is a "long time," about eight years, for policymakers to determine a course of action.
Beyond changing the retirement age, he pointed to other levers that could be pulled to secure the program's finances. "There's a whole host of items out there," he said, suggesting that adjustments could be made to the tax structure that funds Social Security.
Potential Tax Adjustments
One specific option mentioned was increasing the maximum amount of earnings subject to the Social Security tax. For 2025, this cap is set at $176,100, meaning income above this level is not taxed for Social Security purposes.
Lifting or eliminating this cap would increase revenue for the program. Another proposal outlined by the Social Security trustees involves a direct increase in the payroll tax rate. The trustees estimate that a permanent increase of 3.65 percentage points, from the current 12.4 percent to 16.05 percent, would be necessary to cover the funding gap over the next 75 years.
A Changing System for Future Generations
Commissioner Bisignano acknowledged that the rules governing Social Security are likely to evolve for younger Americans. He stated that generations who will collect benefits in the future "will probably have a different set of rules."
The Impact of Raising the Retirement Age
The concept of raising the full retirement age (FRA) is not new. Legislation passed in 1983 has been gradually increasing the FRA from 65 to its current level of 67 for those born in 1960 or later. The primary goal of this change was to improve the program's long-term financial health.
"For every year you raise the age, that is a 7 percent cut in benefits." - Rep. John B. Larson (D-CT)
Critics argue that any further increase effectively constitutes a benefit cut. Representative John B. Larson, a ranking member of the House Social Security Subcommittee, voiced strong opposition to the idea.
"After months of denying it, the Trump Administration is finally admitting what we suspected all along," Larson stated. He explained that raising the retirement age by one year is equivalent to a 7 percent reduction in lifetime benefits. He warned that such a move could push millions more seniors into poverty, especially as they face rising living costs on fixed incomes.
Previous Proposals and Political Debate
Raising the retirement age has been a recurring proposal, particularly among Republican lawmakers. In March 2024, the Republican Study Committee, a group of around 170 GOP members, suggested "modest adjustments" to the retirement age to account for increasing life expectancy.
More recently, in December 2024, Senator Rand Paul proposed an amendment to raise the full retirement age to 70 through gradual three-month annual increases. The amendment was not adopted.
CBO Analysis
The non-partisan Congressional Budget Office (CBO) has analyzed the effects of such a policy. According to its estimates, increasing the full retirement age to 70 would resolve approximately half of the system's 75-year financial shortfall.
The debate over how to secure Social Security remains a central issue in American fiscal policy. While Bisignano emphasized that the ultimate responsibility lies with Congress and the Social Security Trustees, his comments have brought the discussion over potential benefit changes back into the national spotlight.
