Starting next year, workers will need to earn more to receive a full allocation of Social Security credits. The current maximum amount per credit is $1,730, but it’s set to increase to $1,810 by 2025.
To claim retirement benefits, workers must earn 40 ‘credits’ per year, with a maximum of four credits possible in a single year. This requirement affects low earners and part-time workers, who may not receive the full allocation due to the rising earnings threshold.
The amount earned per credit changes annually based on the national average wage index. In 2024, workers need to earn $6,920 to claim their full allocation. By 2025, this number will rise to $1,810.
Adequate Social Security credits are crucial for determining retirement payments. Earning history, highest salary, and age at retirement all impact the amount received. Moreover, sufficient credits are necessary for claiming SSDI disability benefits, with insufficient credits resulting in poverty among over 20% of disabled Americans.
Survivor benefits become eligible after a person’s death, depending on their age and work history. Eligibility can be granted up to 10 years after the worker’s passing, provided they worked for at least 1.5 years in the three years leading up to their death.
As the US Social Security Administration provides information on earning credits and applying them to various aspects of the program, it’s essential for workers to understand the implications of this increase and plan accordingly.
Source: https://en.as.com/latest_news/goodbye-to-1730-earnings-for-social-security-credit-this-will-be-the-new-amount-starting-in-2025-n