The USPS says it’s pausing employee pensions and may go broke next year. Here’s how a post office cash crunch could impact you

"The risk to the Postal Service and the American public from insufficient liquidity for postal operations dramatically outweighs any longer-term risk to the pension funds from not making the currently due payments," Luke Grossmann, USPS chief financial officer, said of the move.

In addition to the pension pause, the USPS also wants to increase the price of First-Class Mail Forever stamps by four cents, going from 78 cents to 82 cents (2), as well as institute an 8% jump in price for priority mail (3) — the latter of which would help offset the rising cost of fuel.

Meanwhile, Postmaster General David Steiner testified before the House Committee on Oversight and Government Reform in March, expressing his frustrations about government regulations that he says are financially stifling the USPS (4).

"I like to say that, in the time since peak 2006 mail volume, the Postal Service was thrown overboard," he noted, "and instead of tossing us a life jacket, we were thrown an anchor."

For the USPS, the cheque isn't in the mail

Steiner's 2006 callback refers to the all-time post office high of 213 billion units moved in a year (5). Volume has declined almost every year since due largely to what the USPS Inspector General called "electronic diversion," or internet-based communications, replacing paper mail (6). Last year volume fell to 109 billion units, or nearly 50% of that 2006 peak tally.

The mail service did recently negotiate a new agreement with Amazon to remain a primary carrier in their delivery network, though only for 80% of the volume from their previous deal (7).

Overall, the USPS posted a $9 billion net loss last year (8), with another $1.3 billion lost in the first quarter of 2026 (9).

In addressing the House Committee on Oversight and Government Reform, Steiner included (4) government regulations and paying "a disproportionately high share of Civil Service Retirement System (CSRS) benefits" as factors contributing to USPS financial woes. But the "most urgent" issue, he said, is their borrowing cap of $15 billion, an amount set decades ago that "should be $30 to $40 billion" to keep up with inflation.

Meanwhile, in December, the U.S. Government Accountability Office (GAO) pointed to efforts that the USPS has taken to reduce expenses, including streamlining delivery networks and tackling transportation costs (10).

Still, they concluded that, "While USPS needs to cut costs, congressional action is likely needed to restore it to financial viability."

The cost of losing the post office

Most Americans don't give mail delivery much thought. But for some, especially in rural communities, the postal service represents a critical lifeline.

Last year, an Inequality.org study found that, across 15 rural states, the "total mailing industry employs more than 761,000 people and generates nearly $146 billion in revenue per year (11)."

It added that the USPS pays a higher median salary to those without college degrees than the national average, and that the postal service delivers to remote areas not serviced — or charged extra for — by private carriers like UPS and FedEx. As well, the USPS acts as a "significant means of communication for older Americans," the study stated, while also providing rural residents the ability to vote by mail.

Meanwhile, the Brookings Institution released a report around the same time calling mail-order pharmacies "a cornerstone of the nation's prescription delivery network (12)."

They wrote that "mail-order pharmacy use increases roughly 20% for every ten miles farther a patient is from a pharmacy" and that nearly 4 million Medicare users "face a triple burden of limited pharmacy access, high mail-order use, and exposure to postal network restructuring."

A 2025 postal reform report by the GAO put forward various scenarios to help fund the USPS — though many, it noted, would significantly impact taxpayers (13).

That includes privatization — which President Trump has supported (14) but which the GAO warned could increase prices for customers and cause service changes.