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If You're Approaching Retirement Age and Somewhat Wealthy, There Is a Good Chance Your Social Security Benefits Are Cut

Austin Smith

Published: February 15, 2025 9:36 am

24/7 Wall St. Key Points:

• Future Social Security reforms may include income-based benefit reductions, potentially cutting off payments for retirees earning over $250,000 annually.
• The retirement age is likely to increase, possibly pushing full benefits eligibility to 70, with early access at a later age than 62.
• Without reforms, Social Security funds could be depleted by 2035, forcing difficult choices between benefit cuts and tax increases.
• Also, are you on track to retire, or are you behind? Most Americans don’t know but you can answer the question with a quick quiz. Click here to learn more. (sponsored)

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Transcript:

[00:00:04] Doug McIntyre: Lee, one of the solutions that’s getting mentioned more and more often, for social security is that if you make more than a certain amount of money, or if you have assets above a certain level, you do not get social security.

[00:00:18] Doug McIntyre: I don’t care how much money you paid into it. It doesn’t matter that the government says we’re mandating that if you make more than 250, 000 a year, after you hit retirement age, you get no social security. Now, maybe the index, maybe you get half of it at 200, and then it goes to zero at 350. But, it’s time to start sweating.

[00:00:41] Doug McIntyre: If you’re retirement age and you’re hoping to get all your social security because it has to be fixed the way that the deficit is right now, it’s not gonna be fixed. The government’s not gonna put any money in the aging population, means that, there are three people working to pay each older person for social security, and that ratio gets worse.

[00:01:03] Doug McIntyre: All the time. And it was 35 when they started, right? Right. 35 to one. They may take the age brackets and move them up, but that’s not enough. And it’s, I think they do two, both of them, they move the age brackets up by two years and they say if you make a certain amount money. And then you just don’t get it.

[00:01:23] Doug McIntyre: Now, I think it’s horrible because, if you paid in, you should get your money back, but they’re out of, they don’t have any solutions. They’re done. Okay. There’s no other trap door to go through.

[00:01:37] Lee Jackson: No, there isn’t. And again, if you’re making 250 or $300,000 when you’re 65, God bless you.

[00:01:45] Lee Jackson: And that’s the way they look at it. And yeah, there’s, it’s going to, it’s going to hit a wall at some point because you can bet, that there’ll be lawsuits that people sue the government and said, it doesn’t matter how much money I make. I paid in a ton. And so did the people I work for because they were matching my social security or whatever that employer to employee status figure is, but it’s gonna be a conundrum that, that just for years, this is why a as much as people like or dislike what’s going on now in Washington, because now all the Democrats are complaining because uh-oh, the money slush is gonna be closed and they’re gonna close. And part of that reason is how can we continue to say built billions and trillions out in foreign aid when we can’t fund Social Security or Medicare?

[00:02:40] Lee Jackson: It’s going to be a nightmare. And you can bet that the opposing political party will and Social Security and Medicare is really something that is untouchable. And most people aren’t even going to hit that wall in terms of you don’t get any. But it’s certainly something to be worried about.

[00:02:59] Lee Jackson: And those numbers are, they’re going to move the goalposts back. There’ll be a day when you can’t take it at 62. Maybe you can take it early at 65, but that’ll be early because the retirement age is 70. So

[00:03:12] Doug McIntyre: If you’re within 10 years of retirement now, you should assume that two things are gonna happen.

[00:03:18] Doug McIntyre: The first one is, that the goalposts are gonna be pushed out for two years. The other one is that there’s going to be income cutoff. I know people are going to sue the government and everything else, but, they have to do both of those things, not just one so that they don’t run out of money in 2035, which is the date that they’re giving them.

[00:03:38] Lee Jackson: Yep. You’re exactly right. And nobody seems to be able to come up with an answer except raising taxes. And that’s something that they just don’t want to do. In fact, they want to put in new tax cuts. Because the Trump cuts not unlike W’s cuts did in 2010 are fixing to expire. So it’s a conundrum that I don’t know what they’re gonna do.

[00:04:03] Lee Jackson: Maybe they could run it through AI and see what that says.

[00:04:06] Doug McIntyre: Right, right. That’ll solve the problem.