6 Big Social Security Changes Coming in 2025

Over 71 million people were eligible to receive Social Security payments in April. Millions of people purchased homes, and each received a $1915 monthly Social Security check intended to help eligible retired residents financially so they could pay for their living expenditures, totaling about $23,000 yearly. While not a substantial sum, Social Security has been essential in demonstrating retired people’s ability to support themselves financially by helping them with their expenditures. Congress and the federal government now claim that six changes to Social Security will take effect in 2025, helping the country’s residents cope with rising inflation.

According to a Gallup annual poll over twenty years ago, eighty to ninety percent of today’s seniors depend only on their Social Security income to partially balance their costs. You should be aware that Social Security Amount in 2024 will increase by about $200 following the implementation of the amendments. It originally meant that the amount they get varies yearly, which is possible for retired persons covered by the American retirement program. This essay discusses all six significant changes to Social Security in 2025 for your reference.

6 Changes Coming For Social Security In 2025:

First and foremost, Social Security payments are an essential regulation that helps low-income seniors in the United States of America pay their obligations. As everyone may know, only eligible US residents can get Social Security payment benefits. Thus, interested people must complete the eligibility conditions correctly. The beneficiaries can anticipate six adjustments through the Social Security Administration that will take effect in the following year of 2025 until the second week of October 2024.

6 Changes Coming For Social Security in 2025

There will be six changes to Social Security. The government plans to implement several additional changes in 2025, including modifications to payroll taxes and cost-of-living adjustments. Nearly all eligible retired Americans depend on the Social Security payment benefits, which are scheduled to alter in 2025. Following the last debate and decision over the six Social Security changes—two of which will be implemented in 2025—the administration will formally announce the update to the beneficiaries’ official website, www.ssa.gov.

6 Major Social Security Changes In 2025:

The US federal government and Social Security Administration anticipate the following six significant changes to Social Security in 2025.

1. The Cost-of-Living Adjustment (COLA) for Social Security should Slightly Raise Payments:

The cost-of-living adjustment (COLA) is, without a doubt, the most anticipated Social Security “change” that occurs every year. The easiest way to conceptualize COLA is as the SSA’s inflation-accounting mechanism. Stated differently, to prevent seniors from losing buying power, Social Security benefits should ideally increase proportion to increases in the cost of the products and services they buy. The tool for such a job is COLA.

COLAs have been above the two-decade average of 2.6% for the past three years. Beneficiaries received increases to their Social Security benefits of 5.9%, 8.7%, and 3.2% in 2022, 2023, and 2024, respectively. This rise may be more moderate in 2025 than in recent years.

The Senior Citizens League, a nonpartisan senior advocacy group, significantly revised its long-term COLA projection for 2025 from 2.6% (based on the March data) to 2.66% when the April inflation report was released. Given that cost-of-living adjustments are adjusted to the closest tenth of a percent, the following year’s 2.7% COLA would be higher than the two-decade average.

For beneficiaries, what would a 2.7% COLA mean? The average retired worker’s check would rise by about $52 per month in 2025 due to an expected 2.7% cost-of-living adjustment, keeping in mind that we haven’t yet reached the months that count for the COLA calculation. Meanwhile, the expected monthly benefits for survivor beneficiaries and impaired workers would rise by $41 and $42, respectively.

COLA increases for 2025:

Beneficiary type Average 2024 check (as of April) Average estimated monthly increase in 2025 Average estimated 2025 check amounts
Retiree $1,915.26 $50.94 $1,966.20
Retired couple, both receiving benefits  $3,830.52 $101.88 $3,932.40
Worker with disability  $1,537.57 $40.90 $1,578.47
Widow(er) $1,781.78 $47.40 $1,829.17
Children of deceased workers   $1,106.70 $29.44 $1,136.14


How does the COLA for Social Security Work?

By comparing the rise in the CPI-W for the third quarter of this year to the third quarter of last year, the Social Security Administration determines the new COLA. Organizations like the Senior Citizens League use data from the Consumer Price Index for July and August, together with estimates for September, to assist them in anticipating the COLA.

With an expected 72.2 million people receiving benefits in April 2024, Social Security payments serve as a lifeline for millions of Americans.

Although COLA projections help forecast future costs, they do not provide a complete picture. Most Medicare Part B recipients have had their regular premium immediately removed from their benefit checks; this amount is expected to increase again in the upcoming year.

The Medicare Trustees predicted a monthly Part B premium increase of around $10.30, from $174.70 in 2024 to $185 in 2025, in its annual report, which was made public in March. A rise in the Part B premium results in Social Security claimants receiving a smaller portion of the new COLA.

Before November, the official 2025 Medicare Part B premium hike will be announced.

2. Payroll Tax Obligations for High Incomes will Almost Definitely Increase:

A second anticipated development for 2025 is that wealthy individuals will probably open their wallets a little wider.

In 2024, the 12.4% payroll tax levied by Social Security will apply to all earned income, including wages and salaries, excluding investment income, which falls between $0.01 and $168,600. Over 90% of the funds the program raises and distributes to qualified recipients come from this tax. Payroll tax is not applied to wages and salaries that exceed the maximum taxable earnings ceiling of $168,600.

However, the maximum taxable earnings limit usually rises in lockstep with the (NAWI), except for years when deflation occurs, and there is no COLA. The NAWI should increase in 2025 and raise the maximum taxable earnings threshold over $168,600 due to increased prices for goods and services.

This change is meaningless for the almost 94% of working Americans who make less than $168,600 a year and contribute to Social Security with every dollar they make. However, it would result in higher payroll tax obligations for the 6% of high earners whose wages are partially exempt.

3. Expect Another Hike in Social Security’s Maximum Monthly Payout:

High earners may pay more in payroll taxes in 2025, but they also could see a rise in their maximum monthly retired worker benefit if they continue to make high wages throughout their lives. Indeed, the maximum number of programs that will pay out at the full retirement age has been established.

The maximum monthly payment for an employee who reaches full retirement age in 2024 is $3,822, a $195 increase over what it was in 2023. Even if the growth in 2025 is likely small, it must be greater than $3,822.

Only around 2% of retired worker recipients are eligible for this maximum benefit; to be eligible, they need to fulfill three requirements:

  • Retirees are required to have 35 years of employment experience.
  • For the benefit to be calculated by the SSA, workers must have earned more than the maximum taxable earnings ceiling for each of the 35 years.
  • To get their pension, retirees must wait until they reach full retirement age.

4. The Income Thresholds for Disabilities should Rise:

Approximately 7.25 million workers received Social Security long-term disability payments as of April. Disabled workers can only take home a specific amount of their monthly earnings to keep these benefits.

Workers who are disabled but are not blind may make up to $1,550 per month in 2024 without revoking their benefits, an increase of $80 from 2023. Meanwhile, visually impaired workers can earn $2,590 per month without their benefits ending—a $130 monthly increase over 2023.

The Social Security disability income criteria for non-blind claimants may exceed $1,600 per month in 2025, while the barrier for blind beneficiaries may approach $2,700 per month, assuming a little slowdown in inflation from the previous year.

5. Rising Early Filer withholding Thresholds are Anticipated:

Not just beneficiaries who work with disabilities may be able to keep more of their wages in 2019 without giving up part or all of their Social Security benefits.

There are a few penalties for early filers, defined as anyone getting a retired-worker pension before they reach full retirement age. Early filers may be subject to the retirement earnings test in addition to a permanent decrease in their monthly benefit of up to 30%, dependent on their birth year and age upon claim. The retirement earnings test allows the SSA to withhold some or all of your benefits based on your earned income.

Retired worker beneficiaries who do not reach full retirement age by 2024 may have $1 of their benefits withheld for every $2 over $22,320 in earned income or a monthly maximum of $1,860. Meanwhile, the Social Security Administration may deduct $1 in payments from retired worker recipients who will reach full retirement age this year for every $3 in earned income over $59,520, or $4,960 each month.

These early filer withholding requirements rise with rising inflation rates that affect Social Security beneficiaries receiving a COLA. This implies that early filers won’t have to forfeit some or all of their advantages, allowing them to keep onto more of their earnings in the next year.

The retirement earnings test is eliminated for employees who reach full retirement age.

6. Social Security Benefits Eligibility will Probably become Increasingly Difficult:

It will become even more difficult for workers to be eligible for Social Security payments in the upcoming year.

Social Security payments aren’t something you get merely because you were born in the country or became a citizen, despite what you may have heard or read online. Traditionally, labor credits are used to gain benefits. To be eligible for a retired worker benefit, you must accrue 40-lifetime work credits; you may not earn more than four credits each year.

The good news is that earning these credits has a shallow threshold. One labor credit was worth $1,730 in earned income in 2024. As a result, you will have accrued the maximum four-lifetime credits for 2024 if your earnings and salaries this year total $6,920 ($1,730 times 4). Anticipate a little increase in this income criterion next year to be eligible for benefits.

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