According to the Social Security Administration (SSA), there will be some beneficiaries will experience a 15% Social Security benefit cut in this month. While this may seem like bad news for some Social Security beneficiaries, all of the beneficiaries need to understand who is on this list and why they are on the list.
However, all SSA beneficiaries need to know the structured schedule of retirement, survivor and disability benefits for June 2025 so they understand what can be expected this June.
SSA payments to expect in June
While bad news will be the order of the day for some SSA beneficiaries, all beneficiaries will benefit considerably from knowing when to expect benefit payment in June:
Social Security, retirement, survivor and disability benefit:
- Citizens who started receiving benefits before May 1997, receive payment on June 3
- Citizens born between the 1st-10th of a month, receive payment on June 11
- Citizens born between the 11th-20th June of a month, receive payment on June 18
- Citizens born between the 21st-31st June of the month, receive payment on June 25
SSI recipients (seniors and individuals with disabilities)
- June 1 (these benefits were paid earlier on May 30 due to the weekend)
- July 1, August 1, August 29 (Advance for September)
99% of payment is made electronically so as to avoid payment delays and minimize errors of any kind.
Introducing the 15% payment reduction
As per the Bureau of the Fiscal Service, in June, Social Security beneficiaries will receive a 15% payment reduction as a result of federal student loan collection. As per the initiative of the Treasury Offset Program (TOP), some citizens will experience payment cuts due to being on the list of those who owe federal student loans.
Attempts are being made by the Treasury Offset Program to garnish payments including that of tax refunds and Social Security benefits to recover federal debts. Although the program had been paused since March 2020, the Trump Administration has decided to give this program momentum again by starting with the recovery of the federal student loan debts.
It is important to note that:
- The Department of Education (DOE) has sent out 195,000 collection notices with all 5,3 million borrowers receiving notices this summer.
- 15% of monthly Social Security benefit can be garnished.
- There is a $750 protected monthly minimum so benefits cannot fall below this.
The decision to cut 15% of Social Security benefits will affect retirees, SSDI recipients as well as low-income seniors who may have taken out a student loan for themselves, their children, or grandchildren. A 15% cut is rather drastic and may result in a $270 cut which is a meaningful loss for those struggling.
How to stop the cuts?
Since approximately 2,9 million people aged 62 or older have federal student debts, many citizens who did not enter into any repayment or forgiveness plan will want to know how to prevent these cuts from happening.
As mentioned in the answers to the FAQs for Debtors in the Treasure Offset Program, important steps can be taken by citizens to protect their Social Security benefit such as:
- Enrolling in Fresh Start: This is a temporary program which enables defaulted borrowers to return to good standing and avoid garnishment.
- Loan Rehabilitation: Making many payments on-time to remove the loan from default.
- Applying for Hardship Waivers: Citizens who can prove unbearable financial hardship will be eligible to stop the garnishment.
- Income-Driven Repayment (IDR) Plans: Citizens with a low income can qualify for $0 monthly payments.
- Seek Forgiveness Option: For citizens like those with permanent disabilities, loan discharge programs are an option.
On all of the Department of Education’s notices this information has been provided so that citizens can take the necessary action before the garnishment starts. Citizens should act now as the resumption of this student debt collection could affect the financial stability of many vulnerable Americans. Social Security recipients who have a defaulted federal loan can expect their monthly checks to shrink by 15% as of this month so action is needed.
While the Social Security Fairness Act brought relief to many citizens, citizens who know their monthly check could shrink by 15% as of this month will face added financial stress and should certainly act.
