# What are Trump's plans for Social Security? Three things to know

## President Donald Trump

President  was sworn into office on Jan. 20, and he has already embarked on an ambitious agenda. With the  administration attempting to make significant spending cuts, many retirees might be wondering what the 47th president's plans are for Social Security, which distributes benefits to tens of millions of Americans each month.

## Social Security Administration

 has long been in a fraught position. The program will need to reduce benefits in 10 years if Congress doesn't make changes to shore up its finances. Although it's still early, let's take a look at three things President Trump has discussed that would affect Social Security.

### Trump says he will not cut benefits

As recently as Feb. 18, Trump promised not to cut benefits. On Fox News, Trump told Sean Hannity that "Social Security won't be touched, other than if there's fraud or something. It's going to be strengthened. But it won't be touched." Trump also said that his administration will not be making cuts to Medicare and Medicaid.

However, Trump could find himself in a difficult position on Medicare. Earlier this month, the House Budget Committee voted for a minimum of $880 billion in cuts to mandatory spending programs monitored by the House Energy and Commerce Committee. One of these programs is Medicaid. This is all part of a House budget resolution that Trump has supported.

The University of Pennsylvania Wharton School's budget model estimates that eliminating income taxes on Social Security could cut U.S. revenue by $1.5 trillion over a decade while raising the country's debt burden 7% by 2054. That's going to leave a difficult decision for Trump, given his hopes of significantly lowering the deficit.

### Income Taxes on Social Security

Either way, if inflation drops as Trump desires, that could lead to a lower cost-of-living adjustment (COLA) for benefits. The Social Security Administration distributes a COLA each year to help the purchasing power of benefits keep pace with inflation. The annual COLA is based on inflation data from the third quarter of each year, so if prices rise at a slower pace year over year, then the next COLA will shrink too.

The 2025 COLA came in at 2.5%, but it remains to be seen how inflation will look in the remainder of this year (and the third quarter specifically). To complicate matters further, many beneficiaries and groups believe COLAs have not kept pace with inflation long term, so even rising COLAs may not be the win some think they are.

_The Motley Fool has a ._

_The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY._

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