It is possible that Social Security is the most controversial issue in U.S. politics. A big change needs to be made to the program or the Social Security Administration will have to cut some retirees’ benefits. Do you want to know what will happen?
It is not likely that Congress will be able to make big changes to the program with less than two months to go.
But that does not mean that all Americans should not know about the changes that were made to the program and how they might affect their plans for the economy in 2025.
Both workers and retirees need to know about all the changes that are coming up in the next year. Because January 1st will come as a surprise if you are not ready for the changes. We show you the main changes that will be made to Social Security.
3 important changes in Social Security
People who are eligible will get more money: A cost-of-living adjustment (COLA) is used to make sure that retirement benefits are kept up with the cost of living.
In 2025, the COLA is 2.5%, which means that most people who get benefits could see a small rise in their monthly checks.
If you make a lot of money, you probably do not have to pay taxes on all of it. But some workers will have to pay more in Social Security taxes. Any salary over $168,600 in 2024 is not taxed.
That amount will go up to $176,100 in 2025. This means that next year, anyone who makes more than $176,100 in 2024 and 2025 will have an extra $465 taken out of their pay.
Making more money while getting Social Security: If you work and start getting Social Security early, you may have to pass the earnings test. Anyone who has not reached full retirement age yet has to take the test.
It works like this: if you make more than a certain amount of money in a year while getting benefits before you reach full retirement age, the government will start to cut the amount you get each month. It goes down by $1 for every $2 earned above the threshold.
The minimum income for 2024 is $22,320. People who get Social Security can earn up to $23,400 or $62,160 next year without it affecting their check.
Also see:-US Government announces final schedule for Social Security, VA, SSI and SSDI by 2025
