President Trump's Social Security Overhaul Could Hit Retirees Hard in 2025 and Beyond

If you've been paying attention, you'll have noticed that while President Donald Trump's administration has not canceled Social Security, as some may have feared it would, it has made some changes -- and more changes may be coming.

These changes, some of which may seem to be a good thing, are likely to hurt retirees in the long run. They may even affect retirees now, in 2025, especially when it comes to retirement planning. It's hard to plan when you're not sure what's happening next.

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Here's a look at what has been happening with Social Security and how it might affect you.

1. Layoffs at Social Security

The Social Security Administration (SSA) said in February that it plans to reduce its workforce of about 57,000 by about 7,000 -- a cut of about 12%. That's concerning because fewer employees may mean fewer people available to help retirees and pre-retirees with their Social Security benefits.

The SSA is actually already an extremely efficient organization, even before these layoffs. The percentage of Social Security spending that goes to administration was only 0.5% in 2024 -- down from 1% in 2006 and 1.5% in 1978.

2. No more paper checks

It's true that most beneficiaries receive their monthly benefits electronically these days, but close to half a million retirees still receive paper checks. The Trump administration is ending paper checks. This will clearly affect lots of retirees, as many may not be able to easily set up direct deposits. Plenty are in their 90s, after all, and some don't even have bank accounts.

3. Tougher identification rules

Until recently, many retirees have been able to make Social Security transactions, such as changing direct deposit account numbers or applying for benefits, over the phone. Now, many such actions must be done online via a "my Social Security" account with two-factor authentication or in person at an SSA office. Those who are not that technologically adept or who live far from an SSA office will clearly be inconvenienced.

4. Social Security taxation is (not!) eliminated

I'm including this non-change because Trump has spoken a lot about how he wants to eliminate taxes on Social Security benefits. This is a tricky issue because while retirees would love to not face any taxes on their benefits, those taxes do generate revenue for Social Security. Without that revenue, the already-challenged program may see its surplus run dry even sooner than expected.

Interestingly, Trump's "Big, Beautiful Bill" does not have the tax cancelation in it, which is a good thing for Social Security in the long run. Still, it might get added, as Congress is still shaping what actually gets passed.

5. Many Social Security regional offices are (not!) closing

This spring, there were reputable reports that as many as 47 Social Security offices were being targeted for closure -- with an Associated Press report linking to a Department of Government Efficiency (DOGE) list of federal real estate closures and listing 26 offices slated to close in 2025. Obviously, if offices are closed, many retirees will have to travel farther to visit the office closest to them or simply may not be able to access a nearby office.

But in late March, the SSA issued a notice saying that "Recent reports in the media that the Social Security Administration (SSA) is permanently closing local field offices are false." It added, "We have not permanently closed any local field offices this year." Still, this status quo may change.

6. The elephant in the room -- a shrinking surplus

Here's the biggest way that retirees could be hurt by the Trump administration when it comes to Social Security: The program long ran a surplus, taking in more than it had to pay out, but with more people living longer and retiring early these days, the surplus is being used up and is estimated to run dry in 2034 -- only eight years away -- if nothing is done to strengthen the program. So far, there's little indication that the folks in charge in Washington want to strengthen it. (There are multiple ways to fix this problem, though.)

So, if nothing is done, beginning around 2034, beneficiaries will only receive 81% of what they're due. With the average monthly retirement benefit of $2,002 as of May, a 19% cut would shrink that benefit to $1,622, reducing it by $380.

Social Security's future right now is unclear, with various parties wanting to make various big changes. If you're anywhere near retiring, you may want to pay close attention to this issue.

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