Social Security Benefits Might Be Cut Soon – This Calculator Shows You How Much You’ll Lose

Old people, tax return and home banking.
diego_cervo / Getty Images/iStockphoto

As Social Security trust funds are beginning to run low, the federal government is looking to address the issue. This includes making cuts to Social Security retirement benefits, according to CNBC.

Covisum, a Social Security claiming tech company, released a Social Security benefit cut calculator. This tool should help consumers and financial advisors assess the potential impact of Social Security benefit cuts on retirement plans.

See: Are You Doomed To Work Forever? What You Can Do If Social Security Isn’t Enough
Find: 35 Retirement Planning Mistakes That Waste Your Money

According to a statement released by Covisum, more people have decided to claim Social Security benefits early because of high unemployment and market instability during the pandemic. This increase in Social Security claims and reduced income from workers has many experts estimating that the Social Security system will run out of funds as early as 2029. This goes against the last Social Security Trustees report, which predicted funds to drain by 2035 with 79% of benefits payable at that time. An official update is expected to be released soon. 

“The possibility of benefit cuts due to the insolvency of the Social Security system is not enough to suggest that most people should claim benefits early,” said Covisum’s founder and president, Joe Elsasser. “These calculators allow both consumers and advisors to see what the future could actually look like if they were to experience Social Security benefit cuts.”

Are You Retirement Ready?
Sponsors of

See: 17 Tips To Live Comfortably Off Just a Social Security Check
Find: What You Can Buy With the Average Social Security Check

Research shows those cuts would likely be less than 25% if they happen at all, he added, as reported by CNBC. 

Experts are expecting the federal government to take action and make some changes. These possible changes include benefit cuts, payroll tax increases or a combination of both. It might be tempting to act in fear, but it’s not the best path to take when it comes to financial planning, mentioned Elsasser.

A free version of the Covisum calculator is available to consumers and requires date of birth, benefit amount at retirement age, the percentage of a hypothetical benefit cut and the year that cut happens. CNBC reported that this tool compares the results of a person’s lifespan in five-year increments based on how early they claim, from age 62 to 70, and the impact if the government makes benefit reductions.

More From GOBankingRates

Are You Retirement Ready?
Sponsors of

About the Author

Josephine Nesbit is a freelance writer specializing in real estate and personal finance. She grew up in New England but is now based out of Ohio where she attended The Ohio State University and lives with her two toddlers and fiancé. Her work has appeared in print and online publications such as Fox Business and Scotsman Guide.
Social Security Benefits Might Be Cut Soon – This Calculator Shows You How Much You’ll Lose
Close popup Live Richer Newsletter

We're here to help you Live Richer.

Sign up to receive our daily weekday newsletter with the latest finance and lifestyle content.

Loading...
Please enter an email.
Please enter a valid email address.
There was an unknown error. Please try again later.

For our full Privacy Policy, click here.