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With a multibillionaire in the Oval Office, there’s rarely been a better time to be rich in America. Nearly halfway into his second term, President Donald Trump’s signature policy accomplishment has been the One Big Beautiful Bill Act (OBBBA), a sweeping reform of the country’s tax code.
Perhaps one of the most noteworthy aspects of this new tax law is the creation of a new additional standard deduction for older Americans (1), which already comes on top of the extra standard deduction older Americans already receive.
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Starting in 2025 and running through 2028, anyone 65 or older can claim an additional $6,000 deduction. The amount is also counted per eligible individual, so two qualifying spouses can claim $12,000 combined. The deduction phases out above $75,000 in modified adjusted gross income, or $150,000 for couples filing jointly.
Even so, researchers and policy experts have found the savings skew heavily toward older Americans in the upper income tiers.
Here is how the law delivers for richer retirees at nearly everyone else’s expense.
Benefits flow to the top
On paper, it might seem like the additional bonus benefits all Americans over the age of 65. However, when you consider that many low- and middle-income individuals were already exempt from taxes under existing deductions and income caps, you can see why adding an additional layer on top is targeted at top income brackets.
“Under prior law, nearly half of seniors already didn’t owe any income tax, including on their Social Security benefits,” says a report by the Center on Budget and Policy Priorities (2). The report also points out that two-thirds of the benefits of this new deduction would flow to families with incomes between $80,000 and $270,000, citing the Tax Policy Center.
According to the report, this cohort of upper-income Americans represent “only a quarter of people over 65.”
Meanwhile, the policy reduces Social Security’s revenue by $30 billion annually, putting strain on the program’s solvency. This is bad news considering that the underlying trust fund is now on course for depletion by 2032, according to the Social Security Administration (3), which could result in a benefit cut for all beneficiaries.
In other words, the new deduction might benefit a small number of affluent older Americans for a few years, but it could create a long-term funding issue that impacts everyone. That means you might want to take steps to protect your money right away — whether or not you qualify for Trump’s new deduction.
Prepare yourself
Whether or not you qualify for the new tax deduction probably determines how you respond to its impact.
For those under the age of 65 or with a relatively modest income, diversifying your portfolio and adding some exposure to safe haven assets could bolster your finances and prepare you for any shocks to the benefits system.
For many investors, gold has typically served as a good way to hedge against any risks or upheavals related to government economic policy. If you are one of those investors (or want to be), a gold IRA is one option for building up your retirement fund with an inflation-hedging asset.
Working with Goldco allows you to invest in gold and other precious metals while also providing the significant tax advantages of an IRA.
With a minimum purchase of $10,000, Goldco offers free shipping and access to a library of retirement resources. Plus, the company will match up to 10% of qualified purchases in free silver.
If you’re curious whether this is the right investment to diversify your portfolio, you can download your free gold and silver information guide today. That way you can make sure gold is right for you before committing.
Get some help
If you’re over the age of 65 and earn income within that upper range, you’ll probably want to take full advantage of the benefit, as it’s only available for a few years. If you’re under the income thresholds, you could even deploy some sophisticated maneuvers, such as Roth conversions or high withdrawals, to take advantage of your new temporary deduction.
But you don’t have to execute these strategies alone — an experienced expert can help you plan them out, with precision. If you have a portfolio of $250,000 or more, for example, platforms like WiserAdvisor can connect you with vetted professionals who specialize in this kind of planning.
Simply answer a few questions about your savings, retirement timeline and overall investment portfolio. From there, WiserAdvisor reviews its network to match you — for free — with up to three vetted, reputable advisors aligned with your specific needs.
You can then schedule no-obligation consultations with your matches to determine who is the best fit for your long-term goals.
WiserAdvisor is a matching service and does not provide financial advice directly. All matched advisors are third parties, and specific financial results are not guaranteed.
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Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines.
Internal Revenue Service (1); Center on Budget and Policy Priorities (2); Social Security Administration (3)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
