The List of All the Big Changes Social Security Has Already Announced for 2025

Social Security will undergo some adjustments around 2025. In order to prepare for the upcoming year, those who will profit from these changes both now and in the future should be aware of them. The program will change in seven ways by 2025:

Cost-of-living adjustment

Social Security claimants will get a 2.5% cost-of-living adjustment (COLA) in 2025, compared to a 3.2% COLA in 2024. This is due to the fact that inflation is still declining.

According to the Social Security Administration (SSA), the average retirement payment will increase from $1,927 to $1,946 per month, a $49 increase, beginning in January. Since this is the lowest COLA in four years, inflation has returned to its pre-pandemic level.

Despite a significant increase in 2022 and 2023 due to rising costs, the average annual COLA has been at 2.6% since 2000. All Social Security benefits, including retirement, survivor, family, and disability benefits, are impacted by the COLA.

Supplemental Security Income (SSI), which assists low-income individuals 65 years of age or older who are blind or disabled, is also impacted. The average benefits and the increase are listed below.

Beneficiary	Before 2.5% COLA	After 2.5% COLA
Retired worker	$1,927	$1,976
Married couple, both receiving benefits	$3,014	$3,089
Survivor benefit, older spouse	$1,788	$1,832
Survivor benefits, widowed parent and two qualifying children	$3,669	$3,761
Worker receiving disability benefits	$1,542	$1,580
SSI maximum federal benefit, individual*	$943	$967
SSI maximum federal benefit, married couple*	$1,415	$1,450

Medicare premiums

In January, the regular monthly cost for Medicare Part B, which covers outpatient care and doctor visits, will increase from $174.70 to $185. For those with extremely low COLAs, this is bad news. Many folks will be able to cope with the COLA hike much more easily with the additional $10.30 per month.

Service at Social Security offices

In order to prevent crowds, the SSA has advised anyone in need of assistance to phone ahead and schedule an appointment since the conclusion of the pandemic. Beginning in 2025, this recommendation will be necessary.

Dawn Bystry, an associate commissioner in the Office of Strategic and Digital Communications, posted a message on the SSA website and sent an email to advocacy groups on November 13. Customers will need to schedule an appointment at our field offices to receive services, including requesting Social Security cards, starting on January 6.

At its more than 1,200 field offices, it aims to improve customer satisfaction, expedite service delivery, and shorten wait times. Improvements have already been observed in the offices that have implemented it.

While walk-ins will not be denied care, scheduling an appointment will prevent individuals from having to wait for hours without a resolution. According to Bystry, offices will not deny service to anyone who are unable or unwilling to schedule an appointment.

Our field offices remain open for anyone in need of immediate or specialized care, including members of the military, members of vulnerable groups, and those with terminal illnesses.

Full retirement age

You can get your entire Social Security retirement payment, which is determined by your lifetime earnings, when you reach full retirement age (FRA). FRA has increased with time by two months for each year of birth.

For those born in 1958, it is 66 years and 8 months, and for those born in 1959, it is 66 years and 10 months. FRA in 2025 will be those born between May 2, 1958, and February 28, 1959. For those born after 1960, FRA will currently expire at age 67.

Benefits can begin as early as age 62, but your payments will be permanently reduced by up to 30%. In contrast, if you postpone benefits past FRA, your payment will increase by 8% annually until you are 70, at which point you will be eligible to receive the maximum amount of benefits.

Social Security taxes

The majority of workers contribute to Social Security by paying a 12.4% tax on their earnings. Employers match the 6.2% that employees contribute to FICA through payroll deductions. On their tax returns, self-employed individuals pay the entire 12.4%.

Although the tax rate has remained constant since 1990, the amount of income subject to taxation varies annually in accordance with shifts in the national average pay. The highest amount of money subject to taxes in 2025 will be $176,100, up from $168,600 in 2024. Social Security does not tax earnings from investments or income over this threshold.

Social Security earnings test

Individuals who work before they reach full retirement age (FRA) and receive retirement, survivor, or family benefits from Social Security are subject to an earnings test. For every $2 earned over $23,400 in 2025, those who are not yet enrolled in FRA will have $1 deducted from their benefits.

Compared to 2024, when $22,320 was taken out, this is an increase. For instance, your benefits would decrease by $8,300, or half of the more money you earned over the cap, if you earned $40,000 in 2025.

The earnings test becomes less stringent as a beneficiary reaches FRA. $1 is deducted for every $3 earned over $62,160 until the month FRA is reached, up from $59,520 in 2024.

There is no cap on your earnings once you reach FRA, and the withheld benefits are gradually reinstated through modified monthly payments.

Social Security Disability Insurance (SSDI) is subject to different income requirements. The maximum monthly income in 2025 will be $1,620. It increases to $2,700 for those who are blind. Your SSDI benefits may be jeopardized if your income exceeds these thresholds.

Qualifying for benefits

You can still earn up to 4 credits annually, and 40 credits is still the minimum required to receive benefits. This indicates that the majority of workers meet the minimal criteria after ten years. The amount of money required to obtain credit fluctuates. It will be $1,810 in 2025, therefore you must earn at least $7,240 annually.

See Also: Social Security Announces New Payments with Plenty of Extra Money for 2025; First Checks Will Be Paid on Those Dates

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