Social Security Checks Could Shrink For 450,000 Retirees As Government Resumes Seizing Benefits Over Student Loan Defaults
From Yahoo Finance: 2025-05-24 20:00:00
The U.S. Department of Education resumes seizing income from defaulted student loans, impacting around 452,000 Americans age 62 and older. Monthly Social Security checks could be reduced to $750, as protection for retirees was never implemented, reverting to a 1996 policy that falls below the poverty line.
Retirees affected by student loan garnishments may struggle to cover basic needs like rent or groceries. The Biden administration proposed raising the garnishment floor to $1,883, but the Trump administration reinstated the 1996 policy. Lawmakers push for legislative changes to halt Social Security garnishments for student loan debt.
Lawmakers introduce a bill to stop Social Security garnishment for student loan debt. Retirees in default are urged to explore income-driven repayment or loan rehabilitation options to avoid benefit garnishment. The Federal Student Aid office extends support and call center hours to assist affected borrowers.