Social Security is the U.S. government’s biggest program; as of June 30, 2024, about 67.9 million people, or one in five Americans, collected Social Security benefits. This year, we’re seeing a record-high of 4.1 million Americans turning 65, which could contribute to the surge in recipients.
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Social Security has long been in an insolvent position. As things stand, Social Security benefits are expected to be payable in full on a timely basis only until 2037. It’s alarming to think that in just eleven years, this lifeline program for retirees could be nearly, if not totally, wiped out.
But some Social Security recipients are perhaps less worried about what could happen to Social Security in 2037 than about what could happen in 2025 and the following three years under the Trump administration.
Could retirees see Social Security benefits cut under Trump? GOBankingRates spoke with Arron Bennett, CEO of Bennett Financials, to find out.
There Could Be Modifications to Social Security
Should the Trump administration make adjustments to the Social Security program in order to tackle the problem of its insolvency, the way Social Security operates going forward could change.
“These modifications may not entail direct cuts for current recipients, but could manifest as raised eligibility requirements or alterations to cost-of-living calculations for future retirees,” Bennett said.
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Whether We’ll See Reduced Benefits Depends on Both Trump and Congress
Bennett asserted that whether there will be reductions in Social Security benefits will depend not only on Trump’s policy agenda, but also on Congress’ willingness to act on Social Security reform.
“Trump has previously promised to safeguard Social Security; however, addressing the program’s challenges may involve difficult choices,” Bennett said. “If no changes are made before the projected depletion of Social Security’s trust fund in the 2030s, benefit reductions could occur as a consequence. Alternatively, Trump could focus on broadening the tax base or implementing strategies to maintain benefits without resorting to cuts.”
If Enacted, How Substantial Could Benefit Reductions Be?
If Trump and Congress resolve to adjust Social Security, how extreme could those modifications be?
“If adjustments to benefits were implemented, they might range from minor tweaks to significant shifts affecting wealthier individuals or younger population groups,” Bennett said.
“For instance, increasing the eligibility age by a year or two could result in substantial savings, while decreasing benefits for high-income retirees would primarily affect a wealthier portion of society. Widespread cuts across all sectors would likely face political opposition and controversy.”
When Could These Adjustments Be Implemented?
If the Trump administration makes adjustments to Social Security, we can expect changes to happen over time and in phases.
“A common strategy involves introducing alterations that primarily impact younger workers or future beneficiaries, deferring the consequences by 10 years or more,” Bennett said. “Immediate reductions to existing benefits would be politically risky and unprecedented.”
Should Retirees Be Concerned?
We don’t yet know if any adjustments will be made to Social Security under Trump, or, if they do, what exactly they will look like. But, as it stands, current retirees don’t have reasons to worry (though the same can not be said as confidently for future generations).
“Retirees shouldn’t worry too much, but should stay informed,” Bennett said. “While immediate reductions in benefits under Trump are unlikely, the program’s long-term stability remains a concern. It’s wise for retirees to think ahead by diversifying their income sources and consulting with experts to prepare for potential changes.”
Editor’s note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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This article originally appeared on GOBankingRates.com: Could Retirees See Social Security Benefits Cut Under Trump?
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