Social Security is changing — here's how advisors are preparing

August 4, 2025 3:23 PM

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Social Security has been at the center of a whirlwind of developments this year, and financial advisors are watching closely.

Since January, the program has generated headline after headline. Call wait times at the Social Security Administration surged in the early months of the Trump administration.

Soon after, changes tied to the Social Security Fairness Act triggered record search interest, as roughly 3.2 million retirees with pensions from non-covered employment became newly eligible for higher benefits. At the same time, the agency briefly reinstated a controversial 100% clawback policy on overpayments — then quietly walked it back.

And that's only part of the story. With new tax deductions for seniors, mounting concerns about the program's long-term funding and shifting public sentiment, Social Security is once again a top-of-mind issue. Here's how advisors are making sense of the changes, and what they're doing to prepare clients.

A double-edged sword in the Big, Beautiful Bill

On the campaign trail, President Trump pledged to eliminate taxes on Social Security benefits. With the passage of the One Big Beautiful Bill Act, his administration claims that promise has been fulfilled. But financial advisors like Monica Dwyer, senior vice president at Harvest Financial Advisors, say the reality falls short.

"The One Big Beautiful Bill gives most of its tax breaks to people who don't need it and is going to hurt us in the future in terms of our ability to take the benefits that we were promised and have paid into for most of our lives when we're at the age of being able to collect Social Security benefits," she said.

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Trump's new law cuts both ways for Social Security beneficiaries

Advisors take a crack at Social Security’s funding shortfall

Social Security Cards with Cash Savings Retirement

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Social Security is projected to face a funding shortfall by 2034, according to the latest Trustees Report. The agency's new commissioner says he's ready to tackle the looming challenge, but details on how he plans to do that remain unclear.

In the meantime, financial advisors have ideas of their own, including raising the retirement age, increasing the payroll tax rate for all workers or lifting — and potentially eliminating — the cap on wages subject to Social Security taxes.

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How to fix Social Security's pending shortfall, according to advisors

Young savers plan for a future without Social Security

United States capitol in Washington DC with a Social Security card and money

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When Michelle Fait, founder of Satori Financial in Seattle, meets with younger clients, she poses a key question: Do you want to count on Social Security being there when you retire?

The answer from most of them, Fait said, is a resounding "No."

While concerns about the program's future have led a record number of older Americans to file early, many younger clients are choosing a different path — planning for retirement as if Social Security won't be there at all.

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Is it time for Social Security to ignore marital status?

Unrecognizable Couple Sitting On Couch At Marital Counselor's Office

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Marriage may no longer carry the same financial weight it once did, according to Jay Zigmont, founder of Childfree Wealth. Should Social Security reflect that shift? According to a recent survey from Atticus, most Americans think so.

Nearly 7 in 10 respondents said marital status shouldn't factor into Social Security benefits. But some financial advisors are skeptical, and they have good reasons why.

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Should Social Security ignore marital status? Most Americans say yes

A turning point for Social Security research

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Most retirement research centers funded by the Social Security Administration have closed in recent months, following major funding cuts in February.

Researchers warn the decision could weaken evidence-based policymaking on programs like Social Security for years to come.

"We just felt like that wasn't a fair assessment of what the work was, and certainly they could look project by project and say, 'This project's not a priority, that project's not a priority,' but to just terminate everything across all six centers all at once and not allow any researchers to move forward, I think it was a wasted opportunity," said J. Michael Collins, faculty director at the UW-Madison Retirement and Disability Research Center.

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Federal funding cuts force retirement research centers to close