Trump changes Social Security rules: up to two million beneficiaries could lose part of their check
A pair of quiet rule changes, one that has just landed in June, could mean smaller monthly checks for some groups of society.
If Social Security is your financial safety net, you might want to check the threads holding it together. Under recent changes made by the Trump administration, up to two million people are now at risk of losing a chunk of their monthly check – and many may not even know it yet.
Why some retirees will see less money starting this summer
Beginning in June 2025, the government has restarted collections on defaulted federal student loans. For borrowers aged 62 and older who receive Social Security – said to be about 452,000 people – this could mean up to 15% of their benefits will be withheld automatically. And this isn’t limited to retirees. Survivors and workers with disabilities are also in the crosshairs.
The Department of Education hasn’t pursued these debts since March 2020 due to the pandemic pause, but that reprieve is officially ending. What’s different now is the speed and size of the garnishment. Beneficiaries will only get 30 days’ warning instead of 65, and the 15% reduction will apply to the full benefit amount, not what’s left after Medicare deductions.
The administration says the garnishment won’t leave anyone with less than $750 a month. But if you’re living on the edge, even a $50 loss can mean missing meals or medication.
Overpayments being clawed back harder
The second rule change affects a broader group: those who’ve been overpaid by the Social Security Administration. The reasons vary – SSA error, unreported income, or a change in disability status – but the result is the same: repayment is due.
Under the Biden administration, clawbacks were limited to 10% per check. But Trump’s team initially announced a return to 100% garnishment, which sparked backlash. Somewhat reminiscent of his tariff ‘negotiations’, that’s now been revised to a 50% clawback rate, meaning half of your monthly Social Security could be withheld until the overpayment is resolved.
That still stings. Around 1.5 million people are estimated to be in this category, and many of them were overpaid without realizing it. Some are already appealing or pushing back, but the policy is in place.
What can you do if this affects you?
If you believe this affects you – or could in the near future – you can request a hardship exemption or repayment plan from the SSA or the Department of Education. Note though that you’ll need to act fast once that 30-day warning letter lands.
Obviously, it’s worth keeping an your eye on related news over the weeks and months, in case the administration decides to change its policy.
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