Social Security will see several changes in 2025 that retirees need to know about. More than 51 million retired workers received a Social Security check in August 2024. Most of them depend on those monthly benefits to make ends meet.
Social Security benefits will get a cost-of-living adjustment (COLA) in 2025. The COLA is an annual pay increase tied to the Consumer Price Index (CPI-W). The 2025 COLA will be announced in October 2024 after the Bureau of Labor Statistics publishes September CPI-W data.
The Senior Citizens League estimates benefits will increase by 2.5% in 2025. Social Security’s full retirement age (FRA) will also increase in 2025. FRA is the age at which a retired worker gets their full benefit amount.
It depends on a worker’s birth year. In 2025, workers born in the last eight months of 1958 will reach FRA at 66 and 8 months. Workers born in the first two months of 1959 will reach FRA at 66 and 10 months.
Retired workers who claim Social Security before FRA and earn income above certain limits will have some benefits withheld in 2025. These limits are called the Retirement Earnings Test (RET) exempt amounts. There are two limits: a lower one for workers who will not reach FRA that year, and a higher one for those who will.
Benefits are reduced by $1 for every $2 or $3 earned above the limits. The 2025 RET limits will be announced along with the COLA. Staying informed about these Social Security changes can help retirees better manage their finances in retirement.
Claiming benefits at the right time and understanding the earnings limits are important for maximizing Social Security income. The first Social Security payments for 2025 will arrive in January. When you get your payment depends on your birth date.
If you were born on the 1st-10th, you’ll get paid on the second Wednesday of each month. For the 11th-20th, it’s the third Wednesday. And for the 21st-31st, it’s the fourth Wednesday.
Social Security adjustments and impacts explained
The average Social Security check for retirees in August 2024 was about $1,920 per month. With the projected 2025 COLA increase, that could go up by around $48 to $1,968 per month on average.
But the official COLA is yet to be announced. You can manage your Social Security information online by creating a “my Social Security” account. There you can do things like request a replacement card, check your application status, estimate future benefits, update direct deposit, and get updates on the 2025 COLA.
You can also access your Social Security 1099 tax form. It’s important to understand the payment schedule and COLA adjustments to plan your finances in retirement. The Social Security website and financial advisors can provide more details and personalized advice.
People living in poverty will soon have an easier time qualifying for Supplemental Security Income (SSI). The Social Security Administration (SSA) is making policy changes starting Monday to simplify and expand the program. “SSI is a program for the poorest of the poor,” said Commissioner Martin O’Malley.
It provides monthly cash assistance to disabled or older people with very low incomes and few assets. One major change is that food assistance from others will no longer disqualify people or reduce their SSI benefits. The SSA is removing food from its calculations, which could boost monthly payments by about $131 for over 90,000 people.
The SSA is also expanding a rental subsidy exception nationwide. This could increase monthly SSI for around 41,000 people by $132 on average. More people will be able to qualify for SSI as a result.
Another change adds food stamp (SNAP) benefits to the types of public assistance listed in SSA policy. This means household members getting SNAP or other aid won’t have to be included in the SSI application process anymore. About 277,000 people may see higher payments and simpler applications due to this.
“We want people to be able to sustain themselves,” O’Malley said. The changes aim to simplify SSI and remove administrative burdens for families. SSI supports disabled or blind adults and children, and seniors 65+ with limited income and resources.
The benefits help cover basic needs like housing, food, clothing and medicine. But there are strict eligibility limits on income and assets.
- Fool.com.”3 Big Social Security Changes Are Coming in 2025. Here’s What Retirees Must Know.”.
- Kiplinger.”Social Security Payment Schedule for 2025″.
- FreeP.”3 key changes will help poor qualify for more money through a Social Security program”.