Since the change in leadership faced by the nation when the Trump Administration had been elected to office at the beginning of the year, the Social Security Administration (SSA) is said to have been facing major upheaval internally as the new administration began enacting sweeping changes to the agency and its processes.
Whilst many critics, the previous SSA commissioner, and many beneficiaries have been showing concerns that benefit payments could potentially face a delay or interruption, for the time being, in terms of the monthly payment, things appear to be rolling out relatively unchanged — provided the beneficiary’s details are all correct and up to date since making any changes to that is a whole other issue under the agency’s new policies.
Social Security beneficiaries to receive higher benefits from 2025
Each year, the benefit amount paid out to recipients has to be adjusted slightly to account for the effects of inflation in the present day. As such, the adjusted figure is calculated using data from the third quarter and it subsequently goes into effect at the beginning of the upcoming year following this. This increase is known as the cost of living adjustment, or COLA.
As such, last October, the cost of living adjustment for beneficiaries was determined to be 2.5%. This increase went into effect as of January this year, meaning that beneficiaries have been recipient of a higher monthly benefit for the past four months. The average monthly retirement benefit has now been increased from $1,927 to $1,976 . As tiny as the increase is, it is aimed at helping beneficiaries cope with inflation. Some advocacy groups, however, disagree with the adjustment saying that “it falls short amid rising living costs.”
Federal officials have also announced that other key changes being enacted at the organization include retirement age, taxable earnings and public sector workers.
Other changes at the SSA
One big change to take note of is the full retirement age, of FRA, for those born in 1959 as it has been increased slightly. The FRA for those born in 1959 now stands at 66 years and 10 months of age. This reflects the continual shift towards the FRA of 67 years for those during or after 1960.
Furthermore, retirees who delay claiming their benefits beyond the age of their FRA will be able to claim higher benefits each month up to the age of 70.
According to a statement made by the agency, “The Social Security adjustments for 2025 reflect our commitment to maintaining the program’s long-term stability while ensuring benefits remain fair and responsive to economic conditions.”
Another important policy change to know is the elimination of the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) as a result of the Social Security Fairness Act being signed into law. This Fairness Act will allow for public sector employees to begin receiving their full benefits. Additionally, a retroactive payment dating back to January 2024 will be made to the affected workers to make up the difference.
A change to earnings limits for workers who receive benefits before reaching their FRA will also be made. The cap has now been increased to $23,400 and as such, those who earn more than this are likely to see a slight reduction in their monthly benefits.
Additionally, the maximum taxable earnings threshold has now risen to $176,100, meaning the amount of income subject to Social Security payroll taxes has also increased.
Lastly, Achieving a Better Life Experience accounts will be expanding its eligibility starting in 2026. These accounts are dedicated to helping those with disabilities save and invest without compromising their federal benefits. As such, the qualifying age for disabilities will increase from 26 to 46. As a result, approximately 6 million more Americans could potentially benefit once it comes into effect.