For many retirees, Social Security is a vital source of financial support — navigating its complexities and staying updated on changes is essential for maximizing its benefits and financial security.
As 2025 approaches, it's essential to be aware of several upcoming changes to Social Security that can help you better prepare and optimize your retirement strategy .
One significant change involves updating your online Social Security account credentials. If you set up your account before Sept. 18, 2021, you must switch to a Login.gov account to continue accessing services online.
The Social Security Administration announced this move to streamline the login process and enhance security by aligning with federal authentication standards.
The online platform offers personalized tools for everyone, whether you are receiving benefits or not. Through your account, you can request a replacement Social Security card, check the status of applications, estimate future benefits, and manage your current benefits.
“My Social Security is a safe and secure way for people to do business with us,” Social Security Commissioner Martin O’Malley told Scripps News. “We’re excited to transition to Login.gov to access our online services, streamlining the process and ease of use for the public across agencies.”
The previous online service will be discontinued later this year, making it crucial for users to transition promptly, but if you already have a Login.gov or ID.me account, no further action is needed.
Read on for eight more social security changes you’ll see this year.
Grow Your $$: 11 brilliant ways to build wealth after 40
1. Social Security benefits are growing by 3.2%
Thanks to the cost-of-living adjustment, Social Security benefits are growing by 3.2% in 2024 for most recipients. This increase aims to reduce the impact inflation has on retirees.
The increase in 2024 is far smaller than that of 2023 (8.7%), but it’s still an increase in your check. For the average retired worker, that’s an increase of $59 per check.
Want to learn how to build wealth like the 1%? Sign up for Worthy to get ideas and advice delivered to your inbox.
2. Medicare premium offset is in place
Many people on Social Security will see premiums for Part B increase, which can hurt the cost-of-living adjustment you just received. The Medicare premium offset is back for 2024 after being applied to 2023 to help reduce the large adjustment to the cost of living.
For most people, the standard monthly Part B premium will rise to $174.70. That’s nearly a $10 increase from the previous year.
3. Maximum taxable earnings are higher
Another change for Social Security in 2024 is an increase in the maximum taxable earnings, often called the contribution and benefit base. For 2024, that base is now higher at $168,600.
This is the amount of your income subjected to the Social Security tax. You pay these taxes during your working lifetime and, ultimately, the funds go to support the Social Security Administration’s retirement benefits.
Supercharge your investments: See what could happen if you add fine art to your investment portfolio
4. The max monthly payout is on the rise for full retirement age
Those who wait until full retirement age before cashing in and who earned a higher wage through most of their working years, are likely to see a boost.
The maximum monthly Social Security check for those who wait until they reach their full retirement age is now $3,822. That’s $195 higher than the previous year. Those who wait even longer to age 70 will see that benefit climb to $4,873.
5. Disability earning limits have increased
A person with a permanent disability, meaning they can’t work, and who qualify for Social Security disability income, will see their income threshold rise. Those who qualify are allowed to earn no more than a set amount of money per month before their benefits are reduced.
For 2024, that figure for non-blind individuals is $1,550 per month. That’s up from $1,470 the year before. For those who are blind, earning as much as $2,590 per month is allowable.
6. The earnings test threshold is higher
Some people collect Social Security but are still working. If that occurs, a portion of their benefit is temporarily withheld. This is often referred to as the earnings test. It applies in situations where you are working, collecting Social Security, and you’re not yet at full retirement age.
The threshold for 2024 is $22,320, a jump from the previous year. Those who earn more than this will have $1 withheld for every $2 in work they complete. For those who will reach full retirement age this year, the limit in the months prior is $59,520.
Can you retire early? Take this quiz and find out.
7. Earning lifetime work credits is harder
To earn Social Security benefits during retirement, a person must earn at least 40 lifetime work credits prior. You can only earn four credits each year.
To receive one credit, you needed to earn at least $1,640 in earned income in 2023, but that figure jumps in 2024. Now, it’s necessary to earn $1,730 to qualify for a credit. That means you’ll need to earn at least $6,920 in 2024 to gain the maximum of four work credits.
8. Nebraska and Missouri recipients no longer have to pay state taxes
All people receiving Social Security must pay federal taxes on those funds each year. Numerous states also tax these funds as income.
In 2024, two states — Nebraska and Missouri — updated their rules to eliminate Social Security taxation. That means residents who were previously taxed in those states will keep more money in their pockets . Ten states continue to tax Social Security benefits.
Bottom line
Social Security rules, earnings, and taxes change each year, much like any other type of change due to inflation or new taxation. For those who are receiving Social Security benefits because they are retired or have a qualified disability, planning for these changes can be critical.
If you’re working and contributing to Social Security, it’s also a good time to start thinking about ways to supplement your Social Security when you reach retirement age. Making some extra money can go a long way in your senior years.
More from FinanceBuzz:
Can you retire early? Take this quiz and find out.
Most Popular
Comments / 0