Social Security “Haircuts”

A little backstory, we have set a 30 years TIPS ladder a few years ago because we were concern with inflation and a surviving spouse in later years of our retirement. We later trim it back to 25 years since we both in our early 70s with some chronic medical issues.

We read about the potential cuts of our SS benefits maybe by early 2030s, some we asked Claude what should we do for the gap years (2035-2039) where there was no TIPS offering until recently for year 2035, and year 2036. Should we invest in growth equity ETF(s) to prepare for the SS “haircuts” (BTW, that was Claude’s term).  It came up with the idea that we should sell the over-weighted year 2040 & with the proceed to buy 2035, and 2036 now. Then, if we are still alive and well, with the maturing proceeds 2027, 2028, and 2029 to purchase 2037, 2038, and 2039 TIPS bonds.

I thought that is a very reasonable idea, since this TIPS ladder is inside our Roth account set aside for the 2 main concerns we have going forward. Plus, Claude also brought up that if we put the fund into growth equity ETFS we would have defected the very purpose the ladder suppose to achieved, plus adding more market risk with a down market.

What are your thoughts about how to prepare for Social Security “haircuts”? Would love to hear others’ planning for them.