This Senator's Plan Could Stop Your Social Security Check From Shrinking in 2032

As the pressure mounts on Congress to preserve Social Security benefits for seniors and address the looming financial shortfall, there's lots of discussion about combining potential program reforms. Senator Bill Cassidy has a two-part plan to help keep the Social Security trust fund solvent. The plan involves a bipartisan bill and a companion act to help find solutions and avoid benefit cuts for beneficiaries, and it reflects a broader shift among lawmakers, including Republicans, to considering tax increases instead of only benefit cuts.

Here's what to know about Cassidy's plan, how it might work, and what it might mean for your Social Security benefits.

The approaching Social Security trust fund insolvency

According to the Social Security Trustees' 2026 report, the Old-Age and Survivors Insurance (OASI) trust fund may become depleted by the fourth quarter of 2032. That's one quarter earlier than the 2025 report projected.

If the fund becomes depleted, the report indicates that the program's revenue may only be sufficient to pay 78% of total scheduled benefits. As a result, benefits may be automatically reduced by about 22% at that time.

Cassidy's idea to protect Social Security

Cassidy has presented a two-part plan to help keep the program solvent and avoid benefits cuts. The first part of the plan is a bipartisan bill co-sponsored by Senator Tim Kaine. Called the "Big Idea," the bill would create a $1.5 trillion investment fund from general revenue. The returns from the fund would be allowed to compound, and they would eventually be credited to the Social Security program after 75 years, helping to fund the program.

What the Big Idea would do differently

If it were to become law, the Big Idea might significantly change how Social Security is funded. Currently, the program's revenue is invested only in special-issue Treasury securities guaranteed principal and interest, and it depends on tax revenue or government debt. However, the Big Idea proposes borrowing money from outside of the program to invest, helping fund Social Security.

Cassidy believes that the current financial shortfall is partially due to the fact that previous efforts to support Social Security haven't used money from outside of the program. For example, Bill Clinton proposed using trust fund money and putting it into the equity market, but the idea wasn't implemented.

"Our proposal sets up an investment fund separate from the trust fund, and no Social Security payroll tax dollars go into it," says Cassidy. "The dollars would come from elsewhere, and there's different options of where the money would come from, but it would not come from the Social Security payroll tax."

The second part of Cassidy's plan

The second part of Cassidy's plan is a bipartisan bill with Senator Dick Durbin. Together, the Senators introduced the Protecting Retirement Opportunities and Maintaining Income Security for Everyone (PROMISE) Act aimed at creating the Congressional action needed to address Social Security's approaching insolvency.

The PROMISE Act would establish a bipartisan process through which Congress may address the program's insolvency by debating proposals. The bill would require the creation of a Social Security Advisory Board, and that board would then collect public input and draft legislation to keep the program solvent for at least 50 years.

Once drafted, the legislation would be introduced to the Senate and the House. The PROMISE Act includes specific requirements for the bill's review, including final votes to be held after 100 hours of debate, ensuring the process keeps moving forward.

The proposal to raise or eliminate the payroll tax cap

Cassidy's approach of using the market to generate income for the Social Security program takes a different route than the proposal to raise or eliminate the payroll tax cap, which a growing number of Republicans and Democrats have been supporting.

In 2026, only the first $184,500 of an individual's annual earnings are taxed for the Social Security program. That means that high earners are paying taxes on just a portion of their income, while lower earners pay taxes on their full income. Raising or eliminating the tax cap would mean higher earners would pay taxes on more or all of their income.

The idea is increasingly receiving bipartisan support. Republican Senator Bernie Moreno joined forces with Democratic Senator Elizabeth Warren to write an op-ed that ran in The New York Times, supporting the idea of lifting the Social Security payroll tax cap. Republican Representatives Tom Cole and Lloyd Smucker have also said in recent interviews that they would consider raising Social Security payroll taxes.

Academic pushback against Cassidy's plan

Cassidy's plan to borrow and invest money to fund Social Security has received academic pushback. Researchers from the Center for Retirement Research at Boston College say that the proposal's math doesn't add up once market volatility is considered.

After running 10,000 simulations, researchers found the fund would fail to repay the money borrowed 64 out of 100 times when optimistic return assumptions were used in the calculations. When researchers used more realistic market performance projections, the failure rate increased to 83 out of 100 simulations.

Bottom line

With proposals for increased taxes, the use of market returns, and benefit cuts all on the table as potential solutions, Congress has some decisions to make. The pressure is mounting as the deadline for the trust fund's insolvency approaches, and public attention is also on lawmakers and their messaging around Social Security during the midterms.

It's possible that benefits might be reduced if the Social Security trust fund becomes insolvent, so now might be a good time to stress-test your budget and retirement plan to see how you might fare on a smaller monthly check.

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