Social Security benefits will see several changes in 2025, affecting millions of Americans. While the cost-of-living adjustment (COLA) may be smaller than expected, it’s still a positive move, and retirees can expect a $48 monthly raise on average. The COLA is tied to inflation rates and is expected to slow down next year.
The maximum Social Security benefit will reach an all-time high of $5,108 per month in 2025, but only if you meet specific requirements. These include working for at least 35 years, delaying benefits until age 70, and reaching the maximum taxable earnings limit. The new limit is $176,100 per year.
One lesser-known change may benefit those who continue working in retirement: higher earning limits. If you’re under your full retirement age (FRA), your benefits will be reduced by $1 for every $2 over the limit of $23,400 per year. But if you’ll reach your FRA in 2025, the limit increases to $62,160 per year. This means you can earn more before facing benefit reductions.
As a new year begins, it’s essential to monitor these changes and adjust your budget accordingly. While some adjustments may be small, they can have a significant impact on your monthly benefits.
Source: https://www.fool.com/retirement/2024/12/23/retirees-snag-larger-social-security-checks-2025