The Social Security Administration (SSA) will implement a series of changes that will affect all retirees. With the arrival of the new year, the changes already agreed upon by the authorities will be implemented. Among the most significant changes, we can highlight the increase in payments due to the Cost of Living Adjustment (COLA), changes in retirement and new requirements to accumulate work credits.
It is necessary to remember that the SSA manages monthly payments to retirees, disabled or beneficiaries. In the case of workers who end their working life after meeting the established requirements, it will be the one that will register the most changes for next year. This is because the system is trying to adapt to the consequences of the increase in life expectancy.
Social Security changes that will affect retirees in 2025
Retirees should pay close attention to the changes that Social Security will introduce in 2025. One of the most important is the increase in the full retirement age. This is the age at which a worker can retire with 100% of his or her pension. This age is currently between 66 and 67.
The fact that it is between two years is due to the fact that the exact age depends on the year of birth of the worker. In other words, a person can reach full retirement age at 66 years and two months or at 67, depending on the year of birth. This increase will also be gradual, which means that the full retirement age will still depend on the year of birth.
What is the reason for this measure? Fundamentally, there are two reasons that stem from the same reason. One is the increase in life expectancy. More and more citizens are reaching retirement age in good health and prefer to continue working. But this same reason has led to a considerable increase in the country’s elderly population. This represents a large pension expense that, if the system is not changed, will be impossible to maintain over time.
Other changes for the new year
The year 2025 is upon us and brings with it a number of changes to Social Security that will affect retirees and workers nearing retirement. However, there are also changes that will affect all other Social Security beneficiaries. This is the case of the increase in the monthly amounts of the checks. This will occur due to the cost of living adjustment.
This benefit, also known as COLA, will be 2.5% in 2025. This is confirmed by the official SSA website. This means that all Social Security beneficiaries will receive more money when they collect their monthly payment. It is worth remembering that the COLA is the result of the calculation obtained from the price increases of basic living expenses in the previous year. Its objective is to compensate pensions so that beneficiaries do not lose purchasing power over time.
Finally, another change for next year affects the accumulation of labor credits. Let us remember that, in the United States, in order to retire, one must have accumulated a series of credits derived from work, and the Social Security Administration plans to change those requirements by 2025. Another important detail in this regard is that the amount needed to accumulate a credit will be adjusted annually based on the COLA.
