One of the top issues during Donald Trump’s 2024 U.S. Presidential campaign was Social Security. He promised to protect the benefits program for seniors. He said eliminating waste and fraud throughout Social Security, Medicare, and Medicaid will strengthen the program.

Many seniors, however, are worried about the longevity of Social Security. As things stand, the Social Security trust fund is set to run out of money in 2033. At that point, the trustees estimate the program will only have enough revenue to pay out 79% of benefits due to seniors.

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While enacting legislation directly targeting that shortfall will require cooperation within Congress, President Trump is taking several actions that will impact Social Security indirectly. Meanwhile, his largest proposed change to Social Security could have a notable impact on seniors’ monthly checks.

Here’s how Trump’s policies, from tariffs to taxes, could impact your Social Security benefits.

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Tariffs could lead to bigger checks next year

Trump has imposed tariffs on goods imported from some of the United States’ largest trade partners. Companies importing many goods from China, for example, will pay a 145% tariff, while most imports from Canada and Mexico come with a 25% tariff.

These policies have set off a trade war where other countries are imposing reciprocal tariffs on U.S. products. And if a foreign manufacturer uses U.S.-made manufacturing equipment or raw materials, that can compound the effect of the tariffs on U.S. consumers.

The end result is higher prices at the store for Americans, or in other words, inflation. But that fact is compounded by the weakening of the U.S. dollar as investors pull money out of U.S. securities, both stocks and Treasury bonds. The U.S. dollar index is sitting near a three-year low as of this writing.

Rising inflation will have a direct impact on Social Security in the form of the cost-of-living adjustment, or COLA. The COLA is based on the average year-over-year change in a measure of inflation called the CPI-W during the third quarter of the year. That’s just enough time for these tariffs to start showing up in the prices of many everyday goods.

While seniors could receive a bigger COLA next year, spikes in inflation are generally bad news for retirees. The COLA is better at keeping up with costs when inflation is slow and steady, but sudden changes can lead to a significant loss of purchasing power for benefits.

Stricter immigration policies could cause more harm than good

The Trump administration has taken a hard stance on immigration. The President has said undocumented immigrants are a drag on Social Security, and removing fraud from the program will protect it for those who deserve their benefits.

The truth is deporting immigrants and making it harder for them to work here will have a negative impact on the health of Social Security. Undocumented workers paid an estimated $25.7 billion in taxes to Social Security in 2022, according to the Institute on Taxation and Economic Policy, a tax research group. However, they won’t be eligible to collect those benefits, making that tax revenue a net gain.

In fact, easing the path to immigration could help extend the life of Social Security or at least mitigate its revenue shortfall in the future. The number of workers per beneficiary is declining due to demographic shifts and birth rates, but immigrants represent a major source of working-age population growth for the United States. The 2024 Social Security Trustee’s report estimates that each 100,000-person increase in immigration reduces the long-term funding gap of Social Security by 0.09% of taxable payroll.

In other words, creating an easier path for people to come to the United States for work will improve the health of Social Security and benefit seniors currently collecting or about to start benefits.

Cutting taxes today leads to bigger cuts later

One proposal President Trump made during his campaign that would directly impact the value of benefits is to eliminate taxes on Social Security income. However, taxes on benefits are an important source of revenue for the government program.

A study from the Wharton School of Business at the University of Pennsylvania estimates eliminating the tax would reduce revenues by $1.5 trillion over ten years. As a result, the program will deplete its trust fund two years earlier than the current estimate. What’s more, seniors will face a bigger cut in benefits when the trust fund runs out of money.

Importantly, eliminating taxes on Social Security will only benefit the highest-income households. The lower 40% of households by income pay an average of about half a percentage point in taxes on their Social Security benefits, according to the Center on Budget and Policy Priorities.

While the President has vowed to help protect Social Security, his policies so far are doing the exact opposite. While he’ll need the help of Congress to make real Social Security reform, the strategies this administration is pursuing will not improve the lives of seniors in the long run.

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