Can Trump Deliver BIGGER Social Security Benefits (this back door way might work)

We all may be getting a front row seat to some of the biggest changes that happened to Social Security in over 40 years. There's currently two major things happening in Social Security, so let's jump in and talk about the first one, and that is the re-election of Donald Trump and his promise to eliminate the taxes on Social Security. Right now, well, in the 1980s, there was a law passed that said up to 50 percent of our Social Security could be taxed, and then in the 1990s, there was a law passed that said up to 85 percent of our Social Security can be taxed, and Donald Trump has promised to eliminate that tax. Now, I think it's going to be hard for him to do it, but I think there's two paths for him to increase the power, the benefit of the checks that retirees are getting from Social Security. So let's start with this CNBC article titled Trump Promises No Taxes on Social Security Benefits. It's too soon to plan on that change, says some experts, and I want to share this with you so we all understand how Social Security is currently taxed. Individuals face up to 85 percent tax on their benefits if they have more than $34,000 in combined income. For a married couple, it applies if their combined income is more than $44,000. Individual beneficiaries may be taxed on up to 50 percent of their benefits on combined income between $25,000 and $34,000, or for a married couple with income between $32,000 and $44,000. So that's the campaign promise. That's what Trump's talking about. And as the article says, it's going to be difficult for this to get through Congress, even with a Republican majority. But I think there's another way that President Trump can make this happen, and that is there's a lesser known rule that if we continue to work after taking Social Security, and if we're below our full retirement age, there's a penalty. So at full retirement age, if you take Social Security and decide to work, no problem. But if you take Social Security before full retirement age and you keep working, there is a problem. This is from the Social Security website, and this is for 2025. And the title is How Work Affects Your Benefits. You can Google this report directly if you'd like. How much can you earn and still get benefits? And the Social Security administration says, if you're younger than full retirement age during all of 2025, they must deduct a dollar from your benefits for each $2 you earn above $32,400. And if this is the year 2025 that you reach full retirement age, they deduct $1 from your benefits for every $3 you earn above $62,160 until the month you reach your full retirement age. Okay, so that might be the back door that President Trump will have. The taxes might be harder to pass, but I think this rule on penalizing people that decide to continue to work, in essence, it's a good thing if people continue to work, continue to be producing into the US economy, continue to pay taxes. And I think this is a rule that people can look at and say, you know, that rule really doesn't make much sense. Now, I'll tell you, the Social Security administration says that we get back this money that we get penalized. But frankly, I've never been able to figure out how they do that. They do say that your monthly benefit goes up. But what happens if you pass away two or three months after that? We had all of this money taken out. So President Trump has really two ways to do this. The first one is just through his campaign promise, which is to eliminate taxes. But I think that's going to be hard. Now, I mentioned that we're looking at two of the biggest changes in Social Security in over 40 years. The second one's already been signed into law. And that happened in December of 2024. And it's the elimination of essentially a penalty for government workers that had worked in the private sector long enough to also qualify for Social Security. The formula that they used to determine their Social Security benefit was different than people that had not worked for the government and do not receive a Social Security benefit, do not receive pension. So it was for those workers, and it was also for people whose spouses had passed away, but the surviving spouse was getting a government pension. They would receive less of a survival spouse Social Security benefit than the rest of us would. And that's already passed. And one of the reasons that passed was it just didn't feel fair. And there's definitely arguments on both sides of the equation. But it passed with a big majority of Congress. So will President Trump be able to get taxes repealed on Social Security? I think that's going to be a heavy lift. But I do think he has a backdoor with how work affects your benefits in this quote-unquote penalty for people that continue to work if they decide to take Social Security before full retirement age. So I think there's a number of ways to do it. Now, the impact of all of this remains the same. And the impact of all of this is, you know, we still have a Social Security crisis in the United States. Right now, the Social Security trust fund is predicted to run out of money in 2033. That's not a lot of time, particularly given how politically difficult something like this is going to get passed. Now, if what Trump promised in the campaign comes to pass, it's going to start depleting that trust fund even more quickly. Now, I'm not saying he should or should not do that. This is not a political channel. I'm just laying out the facts. So what do you and I do? What's the impact? How do we plan for this, given that many people are 10 years away from retirement, or five years, or five months? How do we plan not knowing what's going to happen to Social Security? Now, there's a law in place that says when the trust fund runs out, there's an automatic decrease of our benefits. And it's pretty substantial. It's in the bulk. It's either 20% or 25%. And over half of all Americans rely on Social Security for over half of their living expenses every month. So it's a critically important component. And most of us, a 20%, 25% decrease in our Social Security benefits in retirement would really, really be painful. I mean, I think for a lot of Americans, it would be devastating. So do I think that there'll be a solution? I don't know. But I have to believe that there is a solution. I think that the easiest solution is, right now, there's a cap on how much of our salaries are subject to Social Security taxes. And there are other payroll taxes that don't have a cap. So what do I think is going to happen? I think they're going to raise that cap. I don't know. There's a reason. You know, I'm just a I'm not Senator Russell. I'm not Congressman Russell. But what do we do for our planning? Unfortunately, I think we need to do scenario planning. We need to have two scenarios, one where we have our full Social Security, and one where it's cut by whatever that regulatory decrease is. I know Janet Yellen has said that the existing taxes coming in from the payroll taxes for Social Security is sufficient to fund about 75% of the current benefits. Now, why did I mention Janet Yellen? She chairs the Board of Trustees for Social Security. So I do think a solution is coming. But again, who knows? You know, politically, we have a history of waiting until the last minute to pass things like this. Now, I did mention earlier that second Social Security rule that's already passed. If you haven't seen my video on that yet, you can see it here and get a full disclosure on what that rule is, and how it's going to impact all of us. So thanks for watching this one. I'll see you in the next one. Bye-bye.