Social Security is making several changes in 2025 that will impact millions of retirees. In August 2024, more than 51 million retired workers received a Social Security check. Most of these retirees depend on their monthly benefits to make ends meet.
The Social Security Administration will give benefits a cost-of-living adjustment (COLA) in 2025. COLAs are annual pay increases tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The 2025 COLA will be based on the percent increase in the CPI-W from July to September 2024.
The Senior Citizens League estimates that benefits will increase by 2.5% in 2025. Social Security’s Full Retirement Age (FRA), the age at which a worker can claim full Social Security benefits, is also increasing in 2025.
Workers born in the last eight months 1958 will reach FRA at 66 and 8 months. Those born in the first two months of 1959 will reach FRA at 66 and 10 months. Retired workers who claim Social Security before FRA may have some benefits withheld if their income exceeds certain levels.
These levels are known as the Retirement Earnings Test (RET) exempt amounts. In 2025, the lower RET limit is estimated to increase to $23,280.
Social Security’s cola increase impacts retirees
The upper limit is estimated to increase to $61,800. The first 2025 Social Security payments will begin arriving in January. When you receive your payment, it is based on your date of birth.
If your payment date falls on a weekend or holiday, you will receive that month’s payment on the prior weekday. The Social Security Administration is also making changes to help poor communities qualify for more money through the Supplemental Security Income (SSI) program. Beginning Monday, an SSI applicant will not be turned down for benefits based on the support they receive from friends, family, or the community.
The agency will no longer include food in its “In-Kind Support and Maintenance” calculations. This change could increase monthly SSI payments by about $131 for more than 90,000 people. The agency also expands a rental subsidy exception to all SSI applicants nationwide.
This change could increase monthly SSI payments by about $132 for about 41,000 people. Additionally, the agency will add SNAP benefits to the types of public assistance considered in its policy. This will allow more people to qualify for SSI and reduce reporting burdens.
These changes will help more people qualify for SSI and receive higher payments in some cases. SSI benefits apply to adults and children with disabilities and adults aged 65 and older with limited income and resources.
