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Social Security beneficiaries could receive new protection from federal student loan collections under a proposal introduced by lawmakers. The measure would prevent the government from withholding retirement or disability benefits to recover unpaid student loan debt.
The proposal comes as millions of Americans carry federal student loans in default, although involuntary collections are currently paused. If approved, the measure would give older borrowers greater protection against having their Social Security payments used to repay student debt.
A new proposal would protect Social Security benefits
The proposal, known as the Stop Social Security Garnishment Act, would prevent the government from taking Social Security retirement or disability benefits to collect outstanding federal student loan debt.
The bill was announced on August 17, 2026, and is expected to be formally introduced when the Senate returns next month. Democratic Sens. Elizabeth Warren and Ed Markey also support the proposal.
The legislation has not yet become law. Its purpose is to permanently prevent this type of collection from reducing Social Security payments for older adults and people with disabilities who have student loans in default.
Millions of borrowers could be affected
About 9.5 million federal student loan borrowers are in default, according to an Associated Press analysis of federal data through March.
The issue is particularly relevant for older Americans. Department of Education data from the second quarter show that about 9.6 million student loan borrowers are age 50 or older, with approximately $457 billion in outstanding student loan debt.
The Trump administration has currently paused involuntary collections for borrowers in default. The Education Department said in January that the delay would give borrowers additional time to use repayment and rehabilitation options to bring their loans out of default.
Under current rules, federal agencies can use the Treasury Offset Program to collect certain defaulted federal debts, including student loans, from eligible federal payments. The proposed legislation would eliminate the ability to use Social Security retirement and disability benefits for this purpose.
For older borrowers, the change could help preserve Social Security income for essential expenses such as food, housing, medication, and healthcare.