"Social Security benefits lost about 20% of their buying power between 2010 and 2024. That means many retirees may see their checks covering less each year, even when benefits technically increase. This is especially anxiety-inducing because Social Security replaces only about 40% of pre-retirement income."
"According to the 2025 Social Security Trustees Report, the combined trust fund reserves are projected to be depleted in 2034. If Congress does not find a solution before then, the program would only be able to pay about 81% of scheduled benefits, which would result in an automatic benefit cut of roughly 19%."
"Social Security benefits are designed to rise with inflation through annual Cost-of-Living Adjustments, or COLAs. These increases are based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, known as CPI-W. However, that index reflects the spending patterns of workers, not retirees."
Baby Boomers approaching or in retirement face multiple financial pressures that could strain retirement income. Social Security benefits have lost approximately 20% of buying power between 2010 and 2024 because Cost-of-Living Adjustments are based on worker spending patterns rather than retiree expenses, particularly healthcare costs. Additionally, Social Security's combined trust fund reserves are projected to deplete by 2034, potentially resulting in automatic benefit cuts of roughly 19% if Congress does not intervene. Since Social Security replaces only about 40% of pre-retirement income, many retirees must adjust expectations and prepare for financial challenges beyond what they initially anticipated.
Read at 24/7 Wall St.
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