As much as Social Security is helpful, for a great majority of American retirees, it is an essential form of financial relief. According to recent Gallup survey, approximately 86% of retirees noted that the monthly benefit was a significant source of income, either minor or major. Regardless of its dependence, this program is under financial stress.
A latest report from the Social Security Board of Trustees concluded that the program is projected to lose $25.1 trillion over the next 75 years. It is important to prioritize implementing solutions from now, or else beneficiaries will face cuts from 2033, and payments are expected to be reduced by approximately 23%.
Trump’s Administration Brings Major Shifts
There were many politicians who were subtle about changes in Social Security, but former President Donald Trump, has been vocal and hands on about changes since beginning his second (non-consecutive) term in office
An early change that he initially planned, was signing an executive order to mitigate the use of paper checks by 30th September 2025. From then onwards, benefit payments must made electronically via direct deposits or other similar methods. This move is meant to reduce operational costs and fraud.
The Trump Administration also implemented stricter security processes within the Social Security Administration (SSA). They implemented stricter identity verification processes where individuals would be required to visit an SSA office in person to successfully complete the process.
In order to streamline efficiency, the Department of Government Efficiency (DOGE) made plans to reduce approximately 7,000 staff and close multiple field offices. The goal of this is cut costs and streamline operations.
Going After Billions in Overpayments
The most important change was the recovery of Social Security overpayments. According to data from KFF and Cox Media Group in the 2023 financial year, roughly 2 million beneficiaries were sitting on $23 billion in overpayments.
There are multiple reasons why overpayments occur. Sometimes the SSA calculates benefits incorrectly and sometimes beneficiaries may forget to update their personal information, this then results in incorrect payments.
When Trump was serving his first term, if it was found that a retiree was overpaid, the SSA could recover 100% of their monthly benefit until the outstanding amount was repaid. During Joe Biden’s administration this garnishment rate was temporarily dropped to 10% per month, this was as a result of the pandemic.
During early parts of 2024, the SSA made the announcement that it would revert to withholding 100% benefits. This received a lot of negative feedback and eventually was reduced to 50%.
Options if You’ve Been Overpaid
Thankfully, retirees do have multiple options to reduce the impact of the overpayment recovery:
- Form SSA-632BK — Request for Waiver of Overpayment Recovery
Make use of this form if the overpayment wasn’t your fault and if you would face financial difficulties by repaying this. If granted, the SSA will forgive the entire overpayment. - Form SSA-561 — Request for Reconsideration
This would be applicable if you believe you weren’t actually overpaid or if you accept an overpayment, but perhaps dispute the amount owing. - Form SSA-634 — Request for Change in Overpayment Recovery Rate
Ideal for those who acknowledge the overpayment but need a more manageable repayment schedule.
Failing to take action could mean losing half of your monthly Social Security benefit.
A Forgotten Social Security “Bonus”?
There are many retirees who do not understand that these small solutions can assist in the long run. As long you plan effectively, an example of this is understanding your spousal benefits, as retirees, you could see an additional $23,760 (or more) in annual income.
At the end of the day, Social Security is under financial strain and solutions need to implemented now. Make sure you keep up to date with verified information so that you are able to make proactive decisions and secure your financial future.