2025 Social Security Report

 The 2025 Social Security Report was just released.  First, let's look at the magic words. 

Under the Trustees’ intermediate assumptions, OASDI cost exceeds total income in every year of the long-range period, which runs from 2025 through 2099. The hypothetical combined trust fund reserves decline until reserves become depleted in 2034, one year earlier than projected in last year’s report. 

Consistent with practice since 1965, this report focuses on a 75-year open-group valuation to evaluate the long-range actuarial status of the OASDI program. The open-group valuation includes non-interest income and cost for past, current, and future participants through the year 2099. The open-group unfunded obligation measures the adequacy of financing over the period as a whole for a program financed on a pay-as-you-go basis. On this basis, payroll taxes and scheduled benefits for all participants are included through 2099. The open-group unfunded obligation increased from $22.6 trillion shown in last year's report to $25.1 trillion in this report.

So the open-group unfunded obligation was $25.1 trillion and was up $2.5 trillion since last year.  This is not good at all.

Compare this to my blog post about the 2024 Social Security Report. 

Now I want to see what the expected GDP is under intermediate assumptions.  Look at this table:  https://www.ssa.gov/OACT/TR/2025/VI_G2_OASDHI_GDP.html .  My quick calculations show an average increase in nominal GDP of 4.16% from 2025 to 2030, of 4.05% from 2030 to 2035, and 3.95% after 2035.  This is too complicated.  I say just use a 4.1% average increase in nominal GDP.  This is down from the 4.2% estimate from last year.

The last hard number I saw for GDP was just under $30.0 trillion as of 4/30/25. So the GDP as of 9/30/25 should be about $30.6 trillion as of 9/30/25 and then increase an average of 4.1% per year thereafter.  This will feed into the next financial projection.  I am just waiting for the updated CBO projections and what the Debt to the Public is as of 9/30/25 - I previously was estimating $30.4 trillion, but it will probably be about $30.0 trillion.

In conclusion, none of this is good news, there is rapidly increasing Social Security costs, the trust fund will be depleted 1 year early, and GDP is expected to decline slightly.  The only positive is that the national debt as of 9/30/25 may be slightly lower than previously estimated. 

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Further thoughts:  Even though I just said the SSA saw GDP declining slightly, the actual GDP projected is actually higher in this forecast than the last one through 2070.  Compare the 2024 GDP numbers: https://www.ssa.gov/OACT/TR/2024/VI_G2_OASDHI_GDP.html to the 2025 GDP numbers: https://www.ssa.gov/OACT/TR/2025/VI_G2_OASDHI_GDP.html .  So I think don't change any forecasts of GDP based on this report.  So I would still go by my forecast I made in February 2025.