8 Key Signs You Need a Backup Plan for Social Security Cuts
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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Social Security is a crucial part of many Americans’ retirement plans. According to the Social Security Administration, about 86% of the population ages 65 and older were receiving these benefits as of Dec. 31, 2024.
Threats of Social Security’s trust fund running out of money, necessitating possible cuts to benefits and policy changes by President Donald Trump’s administration, pose questions as to the fate of Social Security down the road.
However, Social Security was never meant to be your only source of retirement income, according to Chuck Czajka, a certified Social Security claiming strategist (CSSCS) and founder of Macro Money Concepts. The truth is that “many people have not saved enough for retirement,” he said.
Financial experts offered eight key signs that you need a backup plan for any Social Security cuts.
You’re Relying Solely on Social Security
The biggest sign that you need a backup plan is if you’re depending only on Social Security for retirement, which may be setting yourself up for financial strain, according to Christopher Stroup, CFP and founder of Silicon Beach Financial.
“You should consider diversifying your savings by contributing to an IRA, 401(k) or other investment options for more long-term security,” Stroup said.
You’re Unaware of Your Retirement Savings
Are your retirement savings a vague notion? Stroup warned that this can be a problem, leaving you unprepared for potential Social Security cuts.
“You should regularly review your retirement accounts and set savings goals to ensure that you’re building a sufficient safety net.”
You’ve Made No Additional Retirement Contributions
If you haven’t been contributing to retirement accounts outside of Social Security, you’re not fully preparing for future financial gaps, Stroup warned.
“You should start contributing to employer-sponsored retirement plans or open an individual retirement account (IRA) to boost your savings.”
You’re Waiting Until the Last Minute To Plan
If you’re procrastinating on making a backup plan for retirement, especially in light of potential Social Security cuts, you could be too late, Stroup said.
“You should begin financial planning immediately by consulting with a financial advisor to build a diversified portfolio and income strategy,” he said.
A Lack of Emergency Savings
Emergency savings enable you to cover unexpected and emergency expenses without having to tap your retirement funds, Stroup pointed out.
“If you don’t have an emergency fund to fall back on, cuts to Social Security might make things worse. It’s important to prioritize building an emergency fund to cover at least three to six months of living expenses to ensure financial stability.”
You Have No Passive Income or Investments
Retirement plans are great, but relying only on fixed benefits is risky, according to Erika Kullberg, an attorney, personal finance expert and founder of Erika.com.
She recommended, “[C]onsider exploring other income sources such as dividend stocks, rental income or any other investments that can provide diversification and therefore a bit of extra financial security.”
You’re Carrying Too Much Debt Into Retirement
If you’re managing large mortgage payments or lots of credit card debt, you’re in a vulnerable position financially heading into retirement, Kullberg warned.
“While you don’t want to compromise your ability to save completely, you do need to prioritize paying down high-interest debt while you still have steady income.”
You Aren’t Up to Date on Yearly Changes
If you aren’t checking in for Social Security updates each year, you could be missing out on key information, according to Kim Gattis, senior vice president and manager of financial planning at UMB Bank.
One example of this is The Social Security Fairness Act, which was signed into law on Jan. 5, 2025, she explained. “This act eliminates a previous Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) that was reducing or eliminating many public servants’ Social Security benefits.”
This could include jobs such as teachers, police, fire, public employees. Around 3 million Americans could be significantly impacted by this update this year, Gattis said.
A financial advisor can help you navigate these changes and others that may be impacting your paychecks in retirement.
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