Approximately eight months on from the start of the COVID-19 pandemic, the disease has already taken our peace of mind, our jobs, and far too many lives. And it's not done taking quite yet.

We will feel the effects of this pandemic for the rest of our lives and in ways you might not expect. Social Security might seem like something that's immune to the present economic shocks, but unfortunately, that's not true. Here's a look at three ways COVID-19 could hurt people's Social Security benefits, whether they're already claiming or plan to in the future.

Mature woman with laptop staring off into the distance

Image source: Getty Images.

1. Benefit cuts on the horizon

Social Security has been heading for trouble for a long time, with the latest pre-pandemic estimates saying the program's trust funds would be depleted by 2035. COVID-19 has put the program in even greater danger, with millions of Americans out of work, at least temporarily. 

Workers on unemployment aren't paying Social Security taxes, so the Social Security Administration is receiving less money this year than it had counted on, and that could move up the trust fund depletion date. The Bipartisan Policy Center estimates that, due to all the economic upheaval the pandemic has caused, the trust funds could now be depleted as soon as 2029.

This is only an estimate, and even if it does happen, it's not a guarantee the government will cut benefits. It's possible government will come up with a different solution to keep the program sustainable for future generations, like raising the full retirement age (FRA) or raising the Social Security tax rate. But benefit cuts are definitely on the table, which is why it's important to save as much as you can in your personal retirement account so you can cover most of your expenses on your own.

2. Loss of income could reduce Social Security checks in retirement

If you've lost your job this year, you're undoubtedly feeling the financial strain right now, but it could also affect your Social Security checks later. Your benefit is based on your average monthly earnings over your 35 highest-earning years, adjusted for inflation. Only income you pay Social Security taxes on counts. 

Many people who are out of work are probably going to pay Social Security taxes on less money this year than they would in a typical year, and that could reduce their Social Security benefit slightly. A single year of reduced income probably won't have a significant effect, but if the economy takes years to recover, that could cost you a lot more.

You can combat this to some extent by making sure you work for at least 35 years, and longer if you're able to. When you work more than 35 years, your lower-earning years drop off and get replaced by your higher-earning years, resulting in larger checks overall.

3. Smaller checks for seniors starting benefits early

COVID-19 has forced a lot of people to change their retirement plans already, and some seniors who are nearing retirement and who lost their jobs or are fearful about exposing themselves to the virus might choose to retire early and claim Social Security to help them make ends meet. It's an understandable move, but it's not without consequences.

Starting Social Security before you reach your FRA -- 66 or 67, depending on your birth year -- permanently reduces the size of your checks. Beginning right away at 62 will only get you 70% of your benefit at FRA per check if your FRA is 67, or 75% if your FRA is 66. Every month you delay benefits increases your checks slightly until you reach the maximum benefit at 70, which is 124% of your benefit at FRA if your FRA is 67 or 132% if your FRA is 66.

If beginning Social Security before your FRA is the only way you can make ends meet and you're not comfortable returning to work, then it's probably your best option. But make sure you understand how your decision will affect your Social Security benefits over the long term, and explore all other options to get the money you need before you sign up for benefits.

I know we don't need any more depressing news right now, but understanding how COVID-19 will affect your Social Security benefits both now and in the future gives you a chance to come up with a backup plan that will still allow you to retire comfortably. Review the above information and decide if you need to make any alterations to your retirement or Social Security plans to keep yourself on track.