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A wave of restructuring at the Social Security Administration is starting to impact retirees, disabled Americans, and low-income seniors. The changes are being driven by the Department of Government Efficiency (DOGE), a White House initiative led unofficially by billionaire Elon Musk with the support of President Donald Trump.
DOGE has slashed staff, shuttered offices, and imposed a larger withholding for overpaid benefits—moves that critics say could hit vulnerable Americans the hardest.
Key Takeaways
- Social Security services are slowing down after DOGE-driven cuts, especially for vulnerable groups like disabled Americans and low-income seniors.
- While long-term benefits are likely secure, navigating the system is getting harder with fewer resources to process claims.
- A new 50% withholding rule for benefit overpayments—up from 10% under President Joe Biden—has raised alarms, with experts warning it punishes vulnerable retirees for mistakes they didn’t make.
Why Cuts Hit Some Harder Than Others
Social Security has long been a lifeline for older Americans and those living with disabilities. But the current staff reductions and field office closures are already having noticeable effects.
Monique Morrissey, an economist at Economic Policy Institute, a left-leaning think tank, says that the people most impacted by DOGE are those disabilities and low-income seniors. These groups rely more heavily on in-person support, which is harder to come by with fewer staff and closed offices.
“People trying to access retirement benefits will also face delays,” she said. “Some people eligible for disability income and Supplemental Security Income (SSI) will lose out permanently from service delays and disruptions in accessing these benefits.”
She also warns that website crashes are becoming more frequent. And when people try to apply online without help, they may miss out on benefits they’re entitled to due to the lack of resources available.
Important
After three months heading up DOGE’s cost-cutting efforts, Musk said in late April he would be “allocating far more” of his time to his job as Tesla CEO, though he stopped short of saying he would completely cut down on government work. “I’ll continue to spend a day or two per week on government matters for as long as the president would like me to,” he said on Tesla’s first-quarter earnings call.
Withholdings for Overpayment
Occasionally, the Social Security Administration (SSA) will pay people more than their monthly benefits are worth. This typically occurs when SSA has the incorrect or incomplete information on file.
When this occurred in the past, the SSA would withhold 10% of the beneficiary’s monthly benefit until the overpaid amount was fully paid back.However, in March, the Trump administration proposed a rule requiring full, or 100%, repayment of any overpaid benefits, which immediately drew sharp criticism.
“It’s retribution without actual wrongdoing,” said Morrissey. “Except in rare cases, these overpayments are accidental, including mistakes by the Social Security Administration—and not attempted fraud.”
While the Trump Administration walked back the proposal just months later in April, saying it would instead default to withholding 50% of benefits, experts still worry the current rule will hit the most vulnerable hardest, like recipients who live on fixed incomes and those who aren’t even aware they’ve been overpaid.
50%
If you receive an overpayment, the Social Security Administration can withhold up to 50% of your monthly payments to recoup it.
What Should You Do?
If you’re already receiving benefits, the system is still working, at least for now.
However, if you want to make changes to your information, like your direct deposit information, it may not be the ideal time, Morrissey warns.
Recently, the SSA imposed new rules regarding identity verification, too. Now, those who want to change their direct deposit information will have to visit a Social Security office in-person to confirm their identity if they’re unable to do so online.
And if you’re considering retiring early to lock in benefits now, Morrissey urges people to weigh that decision carefully, as collecting retirement benefits early results in permanently reduced monthly benefits.
The most important message? Apply for benefits when you’re ready, especially if you think you qualify for disability benefits. “You can apply for SSDI retroactively even if you’re already receiving reduced early retirement benefits,” said Morrissey.
The Bottom Line
Cutbacks at the Social Security Administration have disrupted service delivery and created new hurdles for many Americans. Monthly payments are still being paid, but may be more challenging to apply for benefits or navigate any issues, especially for those without tech access. Staying informed, seeking help when needed, and applying early for complex benefits like disability could make a big difference.
