The Social Security Administration (SSA) has announced that Social Security benefits for thousands of Americans will increase by up to $1,190 monthly. However, recipients may face delays of up to a year for the new adjustments to be implemented. The SSA says it does not have the necessary funds to implement these adjustments without negatively impacting daily customer service.
The new policy is further hampered by a hiring freeze implemented in November 2024. The Social Security Fairness Act signed into law on January 5, repealed the Windfall Elimination Provision and the Government Pension Offset. These provisions had prevented millions of Americans from receiving Social Security benefits if they were already eligible for a pension or retirement program from their job.
This change mainly impacts workers such as teachers, firefighters, police officers, and other public service employees. The Congressional Budget Office (CBO) estimates that ending the Windfall Elimination Provision will increase monthly benefits for more than two million Americans. Repealing the Government Pension Offset is expected to benefit around 380,000 spouses of deceased Social Security beneficiaries and another 390,000 spouses affected by provisions that reduced or eliminated their Social Security benefits.
However, these increases are expected to put additional pressure on the Social Security Trust Funds, which are already facing an imminent insolvency crisis. Retirement age adjustments are another significant change in the coming year. In 2025, the full retirement age will be 66 years and 8 months for people born in 1958 and the first two months of 1959.
For those born in 1960 or later, the full retirement age will be 67. Although it is possible to start receiving benefits from age 62, it entails a permanent reduction in monthly benefits before reaching full retirement age. According to the SSA, delaying retirement beyond the full retirement age can be a strategic option for maximizing monthly benefits.
Every year you postpone retirement, the amount of your pension will increase. These changes will impact both those who are close to retirement and those who are already receiving benefits. The year 2025 brings important developments for retired people in the United States, especially regarding the retirement age and Social Security benefits.
Although Congress passed bipartisan legislation last year to repeal two controversial tax provisions affecting some federal workers and other public servants, the SSA cautioned that it could take more than a year to implement these changes fully. The legislation, known as the Social Security Fairness Act, seeks to repeal the windfall elimination provision (WEP) and government pension offset (GPO). Both provisions had significantly reduced the Social Security benefits for certain retired public servants and their families.
However, lawmakers did not allocate any extra funding to the SSA to facilitate the implementation of these changes. The windfall elimination provision adversely impacted the Social Security benefits of retired federal workers and other public servants who had worked in the private sector. Meanwhile, the government pension offset reduced Social Security benefits for spouses and survivors in families with retired government employees.
The Social Security Fairness Act, which repealed both provisions retroactive to January 2024, affects over 2 million retired public servants and 750,000 spouses and survivors. Many beneficiaries previously saw their entire benefit eclipsed by these offsets. In a recent post on its website, the SSA warned that with its current funding levels, it could take at least a year to adjust the benefits for everyone due to an increase and to issue lump-sum payments covering amounts they would have received in 2024 if not for the provisions.
The SSA is currently experiencing its lowest staffing levels in 50 years and is operating under a continuing resolution, further hampered by a temporary hiring freeze imposed by the Trump administration last week.
Social Security increases face implementation delays
“Processing these changes is very complex, and much of the work must be done manually on an individual case-by-case basis,” the agency stated.
“The SSA is currently processing pending or new claims involving future benefits and developing procedures and automated solutions for computing retroactive benefits. Under the SSA’s current budget, adjusting and paying all retroactive benefits is expected to take more than a year.”
Given that the government pension offset entirely negated many spouses’ survivor benefits, the agency advised individuals to apply for survivors’ benefits if they hadn’t done so already. Those who have applied in the past should review their mailing address and direct deposit information on file with SSA.
“Because the GPO could reduce or eliminate Social Security spouses’ or surviving spouses’ benefits, some recipients of non-covered pensions may have never applied for benefits. Filing sooner might help you get a higher benefit amount,” the SSA advised. Public workers have waited 40 years for legislation to boost their Social Security benefits.
Now, they face another year of anticipation. Retired Middlebury, Connecticut, school teacher Bill Callahan is one of about 3 million affected public sector workers who will have to wait at least another year before seeing the benefits promised by the Social Security Fairness Act. The Act aims to eliminate the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO), which reduce Social Security benefits for certain retirees who also receive pension income.
WEP and GPO affect nearly 3 million Americans, including police officers, firefighters, postal workers, and public school teachers. The Social Security Administration (SSA) stated that while some beneficiaries are being helped now, the full adjustment of benefits and payment of retroactive benefits could take more than a year due to current budget constraints. “Though SSA is helping some affected beneficiaries now, under SSA’s current budget, SSA expects that it could take more than one year to adjust benefits and pay all retroactive benefits,” the agency explained.
Callahan, 67, expressed his frustration: “At the end of the day, it will be a temporary fix for 3 million citizens. The Congress will devise another poorly conceived fix, and another group will become the new pariah.”
The amount of additional money affected workers would receive varies based on factors such as the type of Social Security benefit received and the amount of the person’s pension. “Some people’s benefits will increase very little, while others may be eligible for over $1,000 more each month,” the SSA said.
The delay in paying additional Social Security benefits is attributed to the need for funding and staff, which the SSA currently lacks. “SSA’s ability to implement the law promptly and without negatively affecting day-to-day customer service relies on funding,” the agency said. “The Act did not provide money to implement the law.
Helping people with this new and unfunded workload is made more difficult by SSA’s ongoing staffing shortages, including operating under a hiring freeze since November 2024.”
Callahan highlighted the complexities involved: “Think about it: one year of retroactive payments, additional two years of calculations, spousal issues, etc.”
Nearly 3 million Americans will have to keep waiting and continue getting the same Social Security benefits as if the bill never passed. This delay will also impact the other roughly 68 million Americans unaffected by the new law, who “will face delays and increased wait times as SSA prioritizes this new workload,” the agency added. The Social Security Fairness Act was intended to eliminate WEP and GPO, established in 1983.
WEP affects those who receive “non-covered” pension income from jobs, typically public sector roles, that didn’t contribute to Social Security payroll taxes. The reduction can be significant – up to half the pension amount. The GPO reduces survivor or spousal benefits if a person’s pension is non-covered, cutting the Social Security benefit by two-thirds of the pension amount.
Policy experts have noted that these rules were intended for people who worked in non-covered pension jobs, as they appeared similar to low earners under the Social Security system. These rules aimed to prevent such individuals from receiving the same advantages in Social Security calculations that longtime low-income workers received. The bipartisan nonprofit Committee for a Responsible Federal Budget warned that eliminating WEP and GPO could accelerate Social Security’s insolvency by about six months and increase the severity of automatic benefit cuts when they occur.
