How advisors should prepare clients for Social Security benefit cuts

The clock on Social Security is ticking louder. According to the 2026 annual report from the Social Security Board of Trustees, released June 9, 2026, the Old-Age and Survivors Insurance (OASI) trust fund is projected to run dry in late 2032 — at which point incoming payroll taxes will cover only 78% of scheduled benefits, triggering an automatic 22% reduction in monthly checks for all retirees unless Congress acts. The depletion would affect roughly 70 million beneficiaries, according to the Social Security Administration, and the timeline has accelerated by one year compared to last year's projection.

For financial advisors, the question is not whether to have this conversation — it is how to have it well. Three advisors and planning professionals who spoke with InvestmentNews say the answer lies in separating fact from fear, stress-testing retirement plans against a realistic benefit haircut, and using technology to help clients visualize trade-offs rather than simply absorbing alarming headlines.

Start with the plan, not the politics

Morgan Veth, vice president and financial advisor at Bogart Wealth, argues that the 2026 Trustees Report is a prompt for planning discipline, not a signal to overhaul client timelines.

"Much like the changes to Social Security claiming strategies we experienced back in 2015, where they allowed people close to retirement to continue utilizing the strategy, I don't envision a retirement timeline overhaul necessary for those who are close to retiring," Veth said. "However, I think it is worth taking a conservative stance for younger investors in reducing or eliminating Social Security in their retirement projections."

Veth notes that any Congressional reform is historically unlikely to affect those already near or past age 62. If lawmakers act now, a 4.25 percentage point increase in the payroll tax rate would be needed to stabilize financing over 75 years, according to the 2026 Trustees Report — but if action is delayed until 2034, that figure rises to 4.9 percentage points, underscoring the cost of inaction. For younger clients who have time on their side, Veth recommends treating Social Security as a potential bonus, not a baseline.

Turn anxiety into a planning exercise

Joe Buhrmann, advisory financial planning consultant at eMoney Advisor, frames the Social Security conversation as both an emotional and analytical challenge.

"Advisors are helping clients navigate two challenges at once: uncertainty around policy changes and the strong emotional connection many people have to a guaranteed income," Buhrmann said. "For a lot of clients, Social Security isn't just another income source — it's a symbol of financial security. As a result, any discussion of potential changes can quickly create anxiety or trigger emotional reactions."

Buhrmann, who brings more than three decades of experience in financial services, says that interactive planning technology is the most effective tool for converting that anxiety into agency. Rather than presenting a single projected outcome, advisors can show clients a range of scenarios — including one in which benefits are reduced by 22% — and demonstrate that a well-constructed plan is designed to adapt. According to Buhrmann, financial modeling is most powerful when it analyzes factors clients can actually control: when they retire, how much they spend, and when they claim Social Security benefits.

"Technology can make these conversations more interactive by allowing clients to explore different scenarios alongside their advisor. When clients are actively involved in evaluating trade-offs, they often feel more in control and less likely to react to alarming headlines," Buhrmann said.

Buhrmann adds that younger clients face a distinct version of this challenge. Career transitions, home purchases, childcare costs, and competing financial priorities create a kind of decision fatigue that makes it easy to defer retirement planning altogether — especially when they already assume Social Security may not be available to them. Scenario-based planning tools that show the downstream impact of today's choices in concrete, visual terms can help break that paralysis.

Stress-test the plan against a benefit haircut

Jennifer Raess, product Counsel at Vanilla, says the most important thing advisors can do right now is sharpen the language they use to frame the issue.

"Trust fund depletion" and "benefits completely disappearing" are not the same thing, she notes, and conflating the two causes unnecessary client distress. Even in the worst-case scenario under current law, the 2026 Trustees Report shows that 78% of scheduled retirement benefits would still be payable from ongoing payroll taxes once the OASI trust fund is depleted.

"I like to frame Social Security as one leg of the retirement stool, not the whole chair, which immediately makes the conversation about what the client can control: how much they're saving, what age they'll claim benefits, and how much they plan to spend in retirement. It also helps to give clients historical perspective — Congress has repeatedly closed these gaps, most notably in 1983 when insolvency was just months away," Raess said.

Raess recommends a specific stress-test: model 75% of the client's projected Social Security benefit as the planning floor, and 50% as a true worst case. If the retirement plan still holds at those levels, clients can move forward with confidence. If it does not, that points to a concrete set of adjustments — increasing personal savings, building tax diversification through Roth accounts, and, where health and cash flow allow, delaying the claiming date to lock in a higher guaranteed benefit.

"What you really want is a plan that still works even if benefits get reduced, so that if Congress acts — as it historically has — the client is simply ahead," Raess said. "The point is to build something reliable no matter what Social Security pays, not to overreact."

For younger workers, Raess argues that time is the most powerful planning asset available. Automating contributions to tax-advantaged accounts such as a 401(k) or IRA in their 30s, she says, does more to protect retirement security than any foreseeable cut to Social Security would cost. The Committee for a Responsible Federal Budget estimates the average monthly benefit reduction would be approximately $500 per retiree if the trust fund depletes as projected — a figure that a disciplined savings strategy can more than offset over a multi-decade accumulation period.

Taken together, the advice from these three professionals points in a consistent direction: the 2032 deadline is a planning opportunity, not a crisis signal. Clients who engage with the uncertainty now — and build plans that can withstand a range of benefit scenarios — are in a far stronger position than those who wait for Congress to act. Advisors who initiate that conversation proactively are likely to emerge from it with stronger, more trusting client relationships.