Jun 2, 2026
We’ve been hearing that the Social Security fund would run out of money for years — but Senators Bill Cassidy (R-LA) and Tim Kaine (D-VA) have proposed a solution.
The Cassidy-Kaine plan suggests borrowing $1.5 trillion to create a separate investment fund that would be invested for 75 years. The proposed growth, they claim, could then repay the Treasury with interest and cover the gap between what Social Security collects and the benefits it pays out.
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But would it work? Some experts say no, warning that this plan will leave taxpayers with a “big pile of debt.” Here’s what you need to know about the plan and what it might mean for your retirement planning.
How does the proposed Cassidy-Kaine plan work?
The combined Old-Age, Survivors, and Disability Insurance trust fund (OASDI) is projected to run out of money to fully fund payments in 2032, according to Congressional Budget Office (CBO) analyst Molly Dahl. This is due in part to an aging population, which means the ratio of workers to beneficiaries is declining, leaving a gap in what the fund collects and the benefits it needs to pay out.
The Cassidy-Kaine plan aims to fix this by borrowing $1.5 trillion upfront to seed a separate investment fund. That fund would be invested in equities and other higher-risk assets for 75 years.
The theory: Stocks have historically had a higher return than the Treasury bonds that Social Security currently holds, so the fund would grow large enough to repay the borrowed money and cover the roughly $25.1 trillion gap between projected revenues and scheduled benefits over that period.
However, this plan assumes that the markets will cooperate for three-quarters of a century.
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What do experts say?
Andrew G. Biggs, a resident scholar at the American Enterprise Institute (AEI), ran over 1,000 stress tests on the plan, and the results were not promising. Using a Monte Carlo simulation, which uses a computer to generate a large number of sample outcomes, Biggs found the investment fund would be able to fully repay the debt 30% of the time. This means that, in 70% of the simulated results, the fund’s ending balance wouldn’t be sufficient enough to pay off the associated debt.
Bigg also estimates there is a one-in-10 chance that the plan would finish 75 years owing over $129 trillion. In other words: The plan might not just fail to generate the proposed returns, but it could also result in massive debt.
Researchers at the Center for Retirement Research (CRR) at Boston College ran 10,000 simulations to stress-test the proposed plan and found similar results.
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Even under the most optimistic scenario, using the plan’s own assumed real return of 6.5%, the investment fund would only fully repay the borrowing about 36% of the time, according to CRR researchers Anqi Chen, Alicia H. Munnell, and Jean-Pierre Aubry.
And, because the plan is based on borrowed funds, it won’t just lose money; it’ll lose money that was borrowed that cannot be repaid. Some also argue that the estimated returns used in the Cassidy-Kaine plan aren’t accurate because the plan relies on riskier investments, such as stocks or private equity.
CRR researchers suggest that, if Congress first restores the funds’ solvency through either tax increases or benefit cuts (or a combination of both), and then shifts a portion of the trust fund into equities, it could meaningfully reduce the need for further benefit cuts or tax increases.
What does this mean for your retirement?
The headlines about Social Security running out can be alarming, especially if you are already in retirement or planning for your future retirement. However, there are a few things to keep in mind.
The program has been overhauled before.
Social Security began paying benefits in 1940, so it’s been around for a very long time. Social Security has faced financing crises before — most notably, in 1983, when Congress passed massive reforms that kept the program solvent for decades. This is not its first rodeo.
Don’t rely solely on Social Security for retirement.
If you’re younger, it’s smarter to build a retirement plan that doesn’t rely entirely on Social Security. Even if the program avoids insolvency, there is a chance that benefits could be reduced or the retirement age could be raised.
Factoring in a conservative estimate, say, 75-80% of your projected benefit, will help you build a more resilient retirement plan.
Don’t assume the worst either.
Predictions don’t say the fund will be completely depleted. They suggest that benefits will have to be reduced. However, some combination of tax increases, benefit adjustments, and potentially equity investment could stabilize it again.
Completely ignoring Social Security in your retirement projections could mean you work for decades longer than you need to.
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Danielle is a personal finance writer whose work has appeared in publications including Motley Fool and Business Insider. She believes financial literacy key to helping people build a life they love. She’s especially passionate about helping families and kids learn smart money habits early.
