Social Security: Increase in the COLA and New Income Limits for February 2025

Social Security Increase in the COLA and New Income Limits for February 2025

The Social Security Administration (SSA) has announced changes for beneficiaries of the Social Security Supplemental Income (SSI), Social Security Disability Insurance (SSDI), and Veterans Affairs (VA) programs in 2025. The changes aim to reduce the impact of inflation while also ensuring that payments continue to meet basic needs.

One of the most significant changes is the cost-of-living adjustment (COLA), which will be 2.5% by 2025. This increase will benefit more than 72.5 million people who receive monthly Social Security payments, allowing them to offset the rising cost of living.

Increase in Social Security payments

The COLA adjusts payments based on inflation and the consumer price index, with the goal of preserving beneficiaries’ purchasing power. For retired workers, the average monthly benefit in 2025 will be around $1,976, up $49 from the previous year.

Social Security: Increase in the COLA and new income limits for February 2025
Source (Google.com)

Payout amounts also vary based on retirement age. Those who retire before reaching full retirement age will receive a lower pension, whereas those who delay retirement will receive higher benefits.

New income limit for retired workers

People who continue to work after the age of 62 may see their benefits temporarily suspended if their income exceeds a certain level. This limit will rise to $23,400 by 2025, up $1,080 from $22,320 in 2024.

These changes are part of the annual Social Security update, which is intended to adjust payments to economic conditions while also ensuring beneficiaries’ financial stability.

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