There is very good news for Social Security and Supplemental Security Income (SSI) recipients. In 2024, they will receive a 2.5% increase in their payments beginning January 1. This cost-of-living adjustment (COLA) will reach more than 72.5 million people, as announced by the Social Security Administration through its official media.
Increases in Social Security and SSI Amounts by 2025
The 2.5% increase in 2025 will be applied in different ways for Social Security and SSI beneficiaries. Regarding the first group, officials reported that the 68 million people will receive their adjusted payments beginning in January 2025. SSI beneficiaries will see the increased amount reflected in their income as of December 31, 2024.
It is worth noting that this is great news for beneficiaries across the country. Even more so if we take into account that many people qualify for both benefits, which would represent a large increase in their income. This could completely change their financial situation in the midst of a difficult economic environment.
Changes to Social Security earnings limits
In addition to the increase in Social Security and SSI beneficiary amounts, the cost of living brings with it changes to the earnings limits and the maximum amount of Social Security taxable income. Also, the requirements will be as follows:
- Maximum taxable: the maximum amount of earnings subject to Social Security taxes will rise to $176,100.
- Earnings limits for workers under “full” retirement age: increases to $23,400. For every $2 earned above that limit, $1 will be deducted from benefits.
- Earnings limits for workers reaching “full” retirement age in 2025: increases to $61,160. For every $3 earned over this amount, $1 will be deducted from benefits until the month in which “full” retirement age is reached.
- No earnings limits: for those who have reached “full” retirement age or are older throughout the year, there will be no earnings restriction.
How does the Social Security increase impact retirees?
The cost-of-living adjustment seeks to offset the impact of inflation. It also ensures that beneficiaries do not lose purchasing power amidst the complicated economic landscape the United States is currently facing. And while the 2.5% increase may seem modest, it is a significant relief for millions of retirees and people with disabilities who rely on these payments to cover the basic necessities of home and life.
First 2025 payment canceled
The U.S. Social Security Administration announced a measure that will affect millions of beneficiaries. In this case, it is a modification that will cancel the first SSI payment of 2025 that was to be made in January, according to the official schedule. It will no longer be made on the first day of the month, as it was usually done, but will be made earlier.
Finally, the first SSI payment will take place on December 31, 2024. This decision took place because January 1 is not a working day. It also adopts the strategy it generally uses when an original deposit date coincides with a holiday or weekend: it advances the date. This payment, which will be made on the last business day of this year, will include the 2.5% increase established for 2025.
