Social Security is a vital source of income for millions of Americans, but after 90 years, the program faces significant financial challenges that could reshape it for future generations.

If Congress fails to act, retirees could see their monthly checks cut by 23 percent in less than a decade — slashing thousands of dollars from the average person’s annual benefits.

Lawmakers are unlikely to let that happen, but so far, they’ve opted to kick the can down the road, avoiding politically unpopular solutions and complicating eventual fixes.

President Franklin D. Roosevelt (D) signed Social Security into law on Aug. 14, 1935, as a way to give “some measure of protection to the average citizen and to his family against the loss of a job and against poverty-ridden old age.”

Here’s what to know about the state of the program 90 years later:

How many people receive Social Security?

Nearly 70 million people received Social Security benefits in July, with the average check totaling $1,863. Retired workers made up the largest share — roughly three-quarters, or about 53 million.

The program also supports other groups: Nearly six million people received survivor benefits last month, while more than eight million collected disability insurance.

Most people aged 65 and older receive the majority of their income from Social Security, making it a vital lifeline for millions of adults — and children — who would otherwise fall below the poverty line.

Without Social Security benefits, 37 percent of older adults would have had incomes below the official poverty line in 2023 — instead, only 10 percent did, according to the Center on Budget and Policy Priorities.

More Americans now expect to rely on Social Security than in the past. In a recent Gallup poll, 37 percent of non-retirees said it will be a “major source” of income in retirement — up from 28 percent two decades ago.

When Social Security benefits could be cut

Social Security isn’t going away, but in less than a decade, millions of Americans could see their monthly retirement checks shrink if Congress doesn’t intervene.

The program’s retirement trust fund is expected to run out by 2033, at which point Social Security would only be able to pay 77% of promised benefits.

For today’s average retired worker, that would mean a cut of about $460 a month — more than $5,500 a year.

That said, experts caution against claiming Social Security benefits early out of fear that the program may not be around in the future, as doing so results in permanently lower monthly checks.

Federal lawmakers are expected to act before the cuts take effect, but the main concern is that the longer they wait, the more complicated the fix will become.

Social Security is so widely supported that, until now, politicians have largely avoided moves that could prove unpopular with voters.

The last major overhaul came roughly 40 years ago when the federal government gradually raised the full retirement age from 65 to 67. When that happened in 1983, Social Security insolvency was just months away.

Why Social Security is facing a financial shortfall

The program’s financial shortfall largely stems from the nation’s changing demographics, which have resulted in fewer workers supporting more retirees.

In 2010, there were 43 million people age 65 and older, and by 2024, that number had grown to 59 million, according to the Peter G. Peterson Foundation. At the same time, the number of workers contributing to the program has fallen — from 2.9 covered workers per beneficiary in 2010 to 2.7 in 2024 — a ratio projected to decline further to 2.3 by 2044, the foundation said.

That imbalance is a concern because Social Security is primarily funded through a payroll tax, which accounts for about 90 percent of the trust fund’s income. Fewer workers mean less payroll tax revenue.

The good news is that the demographic shift isn’t a surprise, giving policymakers time to prepare. The bad news is that it’s not easily reversed, and major policy changes may be needed to shore up the program for generations to come.

Something else to keep in mind: Despite raising the income cap over time, a smaller share of wages is now subject to the payroll tax compared to the ’80s and ’90s. The portion of wages and salaries covered by the payroll tax has fallen to about 82 percent, down from 90 percent in 1983, according to the Tax Foundation.

Part of that is due to a rise in employer-provided benefits, like health insurance, which is tax-deductible, and thus faces neither the income nor payroll tax, the Tax Foundation said.

What can be done to fix Social Security?

Lawmakers have a few options: increase Social Security revenue, reduce costs or, most likely, some combination of both.

Democrats want to raise more money by making high earners pay Social Security taxes on income above the current cap. For 2025, the tax only applies to the first $176,100, so any earnings above that aren’t taxed.

Gradually increasing the payroll tax rate is another way to raise revenue. Right now, the Social Security tax rate is 12.4 percent total — split evenly between employees and employers at 6.2 percent each. The combined rate has been steady since 1990.

While raising taxes is rarely popular, polling suggests boosting revenue is generally more acceptable to the public than cutting benefits.

A 2024 Pew Research survey found that wide majorities of both Republicans (77%) and Democrats (83%) do not support Social Security benefit reductions.

President Trump has repeatedly promised not to cut Social Security benefits and even suggested eliminating federal income taxes on retirement checks — though that move would worsen the program’s financial shortfall.

Like his predecessors before him, Trump has offered little concrete policy direction for fixing Social Security. Tech billionaire Elon Musk’s efforts to root out widespread waste, fraud and abuse fell short of expectations and sparked significant confusion.

Earlier this year, Brookings released a bipartisan blueprint for fixing Social Security.

The proposal included tax-based revenue boosts like increasing the maximum taxable ceiling and raising the payroll tax from 12.4 percent to 12.6 percent. It also suggested benefit reductions, like increasing the retirement age for high earners, among other changes.