The Social Security Administration has announced several changes to the program for 2025. One of the most significant updates is the 2.5% cost-of-living adjustment (COLA) that will be applied to benefits. This increase will first appear in the January 2025 checks.
The payment dates for these checks will vary based on the beneficiary’s date of birth. Those born on the 1st through the 10th will receive their payment on Jan. 8, 2025.
Individuals born on the 11th through the 20th will get their check on Jan. 15, 2025. Finally, those born on the 21st through the 31st will receive their payment on Jan.
22, 2025. Supplemental Security Income (SSI) recipients will see their first adjusted payment arrive on Dec. 31, 2024.
This is because the regular payment date of Jan. 1, 2025, falls on a holiday. Another change for 2025 is the higher earnings requirement to receive Social Security work credits.
Social Security January payment adjustments
In 2024, workers earned one credit for every $1,730 in income. This year, the threshold has increased to $1,810 per credit.
Despite this change, most workers are expected to meet the new requirement without difficulty. Higher earners may face additional payroll taxes in 2025 due to the increased maximum taxable earnings for Social Security. The limit has risen from $168,600 in 2024 to $176,100 this year.
This means some individuals could pay up to $465 more annually if traditionally employed or $930 if self-employed. Retirees who have not yet reached their full retirement age (FRA) and continue to work while claiming Social Security will also see changes in 2025. The earnings limit for those under their FRA all year has increased to $23,400, up from $22,320 in 2024.
For individuals reaching their FRA in 2025, the limit is now $62,160, up from $59,520. Lastly, the FRA for people born in 1959 has increased to 66 years and 10 months in 2025. This is part of a gradual increase that will culminate next year when the FRA reaches 67 for those born in 1960 or later.
It is important to note that some Social Security Disability beneficiaries who had a benefit prior to May 1997 will have to wait until January 2025 to receive their new payment. The maximum check for these individuals will be $4,018, which is larger than the payments received in 2024. These changes to the Social Security program reflect ongoing adjustments to keep up with inflation and societal shifts.
Staying informed about these updates is crucial for maximizing benefits and planning for retirement effectively.