Do Student Loans Affect Your Social Security Benefits?

• Your student loan debt doesn’t affect how your Social Security payments are calculated. Retirement and disability benefits are based on your earnings history, not your debt balance.

• If you default on federal loans, the government can garnish up to 15% of your Social Security benefits. But benefits like SSI are protected from garnishment.

• Income-driven repayment plans can lower your monthly payments—sometimes to $0—while keeping you in good standing and working toward loan forgiveness.

Student loans can affect Social Security benefits, but not always in the way people expect. Your loan balance doesn’t reduce your benefits. But falling behind on federal loans can lead to garnishment, which means the government can take money from your benefits. In other words, you’ll receive less money monthly.

The good news? If you stay current on your loans, most borrowers—especially older Americans on fixed incomes—can avoid garnishment and often qualify for low or even $0 monthly payments under income-driven repayment plans.

This guide breaks down how student loans and Social Security intersect, the risks of default, and how to protect your income while managing your loans.

When we talk about Social Security, we often refer to the benefits you receive when you reach retirement age. These are called Social Security Retirement Benefits and are based on your work history and earnings over your lifetime.

But, some people receive Social Security Disability Insurance (SSDI) instead. SSDI provides benefits to individuals who can no longer work due to a disability and have paid into the Social Security system through their jobs.

There’s also Supplemental Security Income (SSI), a separate program designed to help individuals with disabilities or limited income, even if they haven’t paid into Social Security through prior work.

In this guide, when we mention Social Security benefits, we’re primarily referring to retirement benefits, but we’ll clarify when SSDI or SSI applies.

Related: What Disabilities Qualify for Student Loan Forgiveness?

Social Security benefits, whether for retirement or disability, are based on your work history and earnings—not your debt.

The Social Security Administration (SSA) calculates your benefits using:

• Your Average Lifetime Earnings: The highest 35 years of your income, adjusted for inflation.

• A Set Formula: The SSA applies a formula to determine your monthly benefit based on how much you earn.

• When You Claim Benefits: Claiming early on lowers your monthly payment, while delaying increases it.

Because the SSA calculates your benefits based on your earnings history and a set formula—not your debt—your student loan balance won’t impact your monthly Social Security benefit payment, no matter how much you owe.

If you default, the government doesn’t wait—they automatically take up to 15% of your Social Security check. This process, done through the Treasury Offset Program (TOP), withholds a portion of your monthly benefits.

Here’s what the TOP can garnish from your benefits:

• Social Security Retirement Benefits: Payments received based on your work history after reaching retirement age.

• Social Security Disability Insurance (SSDI): Benefits paid to those unable to work due to a qualifying disability.

• Tax Refunds: Money returned to you if you overpaid federal taxes. If you default on student loans, the government can seize (offset) your refund to repay the debt before you receive it.

What cannot be garnished? Supplemental Security Income benefits. SSI benefits are designed for low-income individuals with disabilities or limited resources and are protected from garnishment.

The government can garnish up to 15% of your monthly retirement benefits or SSDI payments, but they must leave you with at least $750 per month after garnishment.

For a deeper explanation of how this process works and ways to protect your benefits, check out our guide: Can Social Security Be Garnished for Student Loans?

Student loans do not count as income for Social Security benefit calculations.

The Social Security Administration bases your benefits on your earnings history, not your debts or loan balances. But there are situations where your benefits might indirectly affect student loan payments:

• Income-Driven Repayment Plans: If you’re on an IDR plan, taxable Social Security benefits can be factored into your income when calculating your monthly loan payments.

• Taxed Benefits: If your Social Security income is taxable due to other income sources, it may influence how much you pay under an IDR plan.

Related: How Can I Stop Student Loans From Taking My Taxes?

Student loan forgiveness generally does not directly impact your Social Security benefits. But there are some important details to keep in mind depending on the type of forgiveness you qualify for:

• Public Service Loan Forgiveness: PSLF cancels your remaining loan balance after 120 qualifying payments without tax consequences, so it does not impact your Social Security benefits or taxable income.

• Income-Driven Repayment Forgiveness: Forgiveness through an IDR plan after 20-25 years could be treated as taxable income under current federal law (except for the temporary waiver through 2025). If the forgiven amount is taxed, it could increase your overall taxable income for that year, but it would not affect how your Social Security benefit is calculated.

Related: Student Loan Forgiveness for Social Security Recipients

Are you worried about losing your Social Security check to student loans? Here’s what to do right now:

• Explore Repayment Plans to Avoid Default: The most effective way to safeguard your benefits is to stay out of default. IDR plans can lower payments based on your income—often as low as $0 or less than $100 for many retirees on fixed Social Security income. This approach keeps your loans in good standing and protects your benefits from garnishment.

• Bankruptcy Isn’t Usually Necessary: While some people consider bankruptcy to deal with student loan debt, it’s often unnecessary if we can secure a manageable monthly payment through IDR. These plans keep payments affordable and help borrowers work toward loan forgiveness.

• Get Professional Guidance When Needed: If you’re unsure which repayment plan is right for you or have already defaulted, speaking with a student loan lawyer can help you protect your benefits and explore options to manage your loans effectively.

Related: What Happens If You Can’t Pay Private Student Loans

The government is taking Social Security checks from seniors who defaulted on student loans they took out decades ago.

In response, Democratic lawmakers, including Senators Elizabeth Warren and Ron Wyden, have called on the Biden administration to address these aggressive collection practices through new initiatives. Their proposals aim to:

• Reform Garnishment Rules: Efforts have focused on protecting vulnerable borrowers from the Treasury Offset Program so they don’t have to worry about the federal government taking up to 15% of their monthly benefits.

• Expand Protections: Calls for broader safeguards, particularly for those receiving SSI and SSDI.

• Address Racial Disparities: Studies have shown Black and Hispanic borrowers are disproportionately affected, leading to additional pressure for reforms targeting equity in debt relief policies.

While these efforts are ongoing, the government has not enforced any major policy changes. For now, the most effective way to protect your Social Security benefits is to stay current on your loans or explore options like IDR plans to avoid default.

Related: Am I Eligible for Student Loan Forgiveness at Age 65?

It’s hard enough planning for retirement on a fixed income, especially for older borrowers balancing medical bills, credit card debt, and other expenses.

The good news? Student loan debt won’t reduce your Social Security payments.

The bad news? If you default on federal loans, the government can garnish up to 15% of your Social Security benefits—a serious risk for many Social Security beneficiaries.

But you can avoid defaulting.

Income-driven repayment plans can lower your monthly payment—sometimes to $0—and still lead to loan forgiveness.

If you’re unsure how to manage your outstanding student loans or want help choosing a repayment plan that protects your benefits, book a call with one of our student loan experts today.