Social Security benefits are set to change in 2025, impacting millions of Americans who rely on the program for retirement income, disability benefits, and financial support for children of deceased workers. The changes will affect both the amount of benefits received and the quality of service provided by the Social Security Administration. In 2025, Social Security benefits will receive a 2.5% cost-of-living increase.
The full retirement age for benefits has also increased for those born in 1960 or later. While individuals can start receiving reduced benefits at age 62, waiting until the full retirement age results in a larger monthly payment. Delaying benefits beyond the full retirement age can further increase payments by 8% annually until age 70.
The Social Security Fairness Act, signed into law on January 5, will impact about 3 million eligible retirees. The act repealed two federal provisions that barred employees with a public pension from collecting their full benefits under the federal retirement program. The Social Security Administration began depositing retroactive payments into bank accounts on February 25, with plans to complete nearly all retroactive payments by the end of March.
Adjustments to ongoing monthly benefits will begin in April. Changes to Social Security in 2025 will also affect earners at both ends of the wage scale. The wage cap, which determines how much of an individual’s income is subject to Social Security payroll taxes, will increase to $176,100.
Changes impacting Social Security beneficiaries
This means those earning above this amount will pay no more than $10,918 in Social Security taxes in 2025—about $465 more than last year. To qualify for Social Security from your earnings, you must accumulate 40-lifetime work credits, with a maximum of four per year.
In 2025, the requirements for earning a work credit will change. A person must make $7,240 to earn four credits in 2025, up from $6,920 in 2024. This change may affect those who rely on part-time work or who are full-time caregivers and parents.
The Trump Administration’s plan to trim the federal government includes “significant workforce reductions” at the Social Security Administration. The agency plans to cut 7,000 employees to reach a staffing target of 50,000. Uncertainty remains about how these staffing cuts will impact beneficiaries, but some politicians and policy experts warn that it may increase wait times and slow down benefits processing.
Rep. Mike Levin (CA-49) has expressed concerns that the layoffs and closures could delay, disrupt, and deny benefits for 70 million Americans who rely on Social Security. “I’m calling on the Social Security Administration to publicly commit to keeping every one of the Social Security field offices in our region open,” said Rep.
Levin in a statement. “When an office closes, it means worse service, longer lines, and residents lose access to the help they need.”
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