The 2025 Social Security Trustees Report has not yet been released. Federal employees should continue to consider Social Security’s role in their retirement planning. Under the Federal Employees Retirement System (FERS), retirement benefits come from a Basic Benefit Plan, Social Security, and the Thrift Savings Plan (TSP).
Social Security and TSP follow employees even if they move to private sector jobs. The agency takes Basic Benefits and Social Security costs from payroll and pays employer contributions to the Civil Service Retirement and Disability Fund (CSRDF) and the Social Security Trust Fund.
It also makes TSP contributions. The Old-Age and Survivor Insurance (OASI) Trust Fund is a key part of Social Security, providing retirement benefits.
It is expected to run out of money by 2033. Then, available revenues will only cover about 83% of scheduled benefits. This means a 17% cut in Social Security checks for people getting benefits.
Last year, Social Security paid over $1.5 trillion in benefits to more than 72 million people. Changes are being considered to fix the funding gap. The Brookings Institution shared a plan to ensure the OASDI program has enough money for 75 years, from 2023 to 2098.
The plan focuses on increasing revenue, cutting benefits, and improving benefits to better help retirees, disabled people, and survivors. Key ideas to secure Social Security:
Revenue Increases:
1. Raising the taxable maximum ceiling (now capped at $176,100 in 2025).
2. Changing payroll tax rules for pass-through entities.
3. Raising overall payroll tax rates. Benefit Reductions.
4. Slowly raising the retirement age for high earners.
5. Changing benefit calculations to include 40 years of earnings instead of 35 by 2040.
Securing married retirees’ benefits
1. Taxing all Social Security benefits for high earners (above $100,000 for singles and $125,000 for couples).
2. Phasing out the dependent spouse benefit, except for disabled spouses or widows/widowers.
Benefit Improvements:
1. Increasing survivor benefits.
2. Adding a disability benefit for older workers.
3. Extending student benefits for children of deceased or disabled parents.
4. Offering child benefits to grandparents or other relatives as caregivers.
5. Improving help for disabled adult children.
Coverage and Transfers:
1. Putting all taxes from Social Security benefits into OASDI trust funds.
2. Growing the labor force through changed immigration policies.
3. Making sure everyone is covered under Social Security. On February 11, 2025, sixteen U.S. Representatives, equally split between Democrats and Republicans, asked the Senate leadership to consider this centrist solvency plan.
They said this blueprint could potentially mirror the success of the 1983 Social Security amendments. Those secured 50 years of program solvency and made significant improvements to reduce poverty among the elderly.
The 1983 amendments made several key changes that have kept the Old Age Survivors and Disability Insurance (OASDI) programs solvent to this day.
These included extending coverage to newly hired federal employees. More structural changes are needed to ensure Social Security benefits last and are reliable for future generations.