Social Security changes just took effect under new leadership following the swearing in of Frank Bisignano as the new commissioner of the Social Security Administration. These new changes will affect how millions of Americans receive their Social Security benefits. Since Trump took power for the second time, multiple policy shifts have been made, all aimed at improving the efficiency and effectiveness of the agency. Here are the changes that you should be aware of, whether you are a beneficiary or preparing to claim Social Security:
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Major Benefit Increases for Retirees
Pensioners are set to receive major benefit increases after the Social Security Fairness Act went into effect in January 2025, eliminating the Windfall Elimination Provision and the Government Pension Offset. These two provisions reduced or eliminated benefits for public workers like police officers, teachers, firefighters, and federal employees under the Civil Service Retirement System. Some beneficiaries could see major monthly increases of about $1,000 or more. The SSA will issue them retroactive lump-sum payments dating back to January 2024, providing immediate financial relief to those affected.
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Changes to Withholding Rates for Overpayments
Under the Biden administration, recipients who had been overpaid had to deal with a default withholding rate of 10% of their monthly benefits. Under the Trump administration, the SSA has reinstated a 50% withholding rate to recover overpayment on retirement, survivors, and disability insurance benefits. Although this is a less drastic shift than the 100% withholding rate that had been originally proposed, some experts have warned that the affected beneficiaries could face financial hardships if 50% of the benefits are withheld.
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Student Loan Debt Garnishment Resumes
Besides the 50% Social Security overpayment recovery plan, beneficiaries with federal student loans may have their benefits garnished as the government tries to collect defaulted loans. Starting June 2025, the Treasury Department Offset Program will allow the Education Department to withhold Social Security payments, wages, and tax refunds for individuals who have defaulted on their federal student loans. This could be a heavy financial blow for beneficiaries living on a fixed income.
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In-Person Appointments for Some Beneficiaries
Following changes pushed by the Department of Government Efficiency (DOGE), the SSA has made major changes regarding in-person appointments. Previously, many services could be provided by phone or online, but now, some beneficiaries will have to visit SSA offices in person to get certain services. This is part of a broader plan to combat fraud and improve accountability within the system. Although some services, such as those for retirement, survivors, and spousal benefits, can still be provided by phone, SSI and disability claims will require an in-person visit for registration or submission of documents. This change presents serious challenges for elderly and disabled individuals who may not have easy access to an SSA office or lack the computer knowledge to complete online verification requirements.
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Digital Social Security Cards Coming Soon
In efforts to modernize how beneficiaries access and use their Social Security information, the agency will roll out a digital Social Security card for beneficiaries starting in the summer of 2025. These Security digital cards will allow individuals to access and display their Social Security numbers through digital devices. The aim is to reduce the inconvenience of losing a physical card and offer a secure, easily accessible option for those who need to verify their Social Security number for non-Social Security purposes.
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Changes to Direct Deposit Information
While beneficiaries can update their direct deposit information, there are still restrictions in place. Although the SSA will allow some changes to be made over the phone, those who need to update their banking details will have to do so either online or in person. This new policy is part of the ongoing efforts to combat fraud. However, it has raised concerns among advocacy groups who argue that the new process may be challenging for older adults who have mobility issues and lack internet connectivity.
Conclusion
While these changes are part of the SSA’s plans to improve service delivery and combat fraud, some come with challenges, especially for vulnerable beneficiaries who struggle with online verification processes and have mobility issues. Beneficiaries should stay informed about these new rules and reach out to the SSA for guidance if they are unsure how these changes will impact their benefits.