5 Must-Know Changes to Social Security in 2025!

are you ready for the big changes coming to Social Security in 2025 whether you're nearing retirement or already collecting benefits what happens next could have a huge impact on your financial future in this video we're diving into the five critical updates that could change everything you thought you knew about Social Security Plus we'll uncover how these changes could affect your wallet regardless of who wins the next election stay tuned this is information you can't afford to miss what welcome to today's update where we're diving deep into the significant changes coming to Social Security in 2025 with the election around the corner there's a lot of Buzz about what might happen and I've been getting countless questions from viewers just like you wondering who to vote for to ensure Social Security is protected but here's the truth while the presidential race is important the real power over Social Security lies in the hands of Congress So today we're going to break down the five major changes you can expect regardless of who wins the White House number one bigger Social Security checks for retirees let's start with the first big change the size of Social Security checks in 2025 seniors receiving benefits will see an increase in their payments this isn't just wishful thinking it's the result of the automatic cost of living adjustment or cola this adjustment is designed to help retirees maintain their purchasing power as inflation erodes the value of the dollar the increase is projected to be around 2.6% to 2.7% while any increase is good news the reality is that this adjustment may not fully keep Pates with Rising costs especially if inflation remains high so while you might see a little extra in your pocket it may not go as far as you hope number two earning work credits gets tougher the next change concerns the income you need to earn to qualify for Social Security work credits Social Security is an earned benefit meaning you must accumulate 40 work credits to be eligible in 2024 you need to earn $1,730 to gain one credit and you can earn up to four credits per year in 20125 this amount is set to rise to reflect overall wage growth this might seem like a small change but it's crucial for those working part-time or who have had gaps in their employment for example if you took time off to care for a family member during the pandemic or had reduced work hours this could impact your ability to earn enough credits ultimately affecting your retirement benefits number three higher earnings limits for working seniors another important update is the increase in the amount you can earn without reducing your Social Security benefits for those who haven't yet reached full retirement age this is critical currently if you earn above a certain threshold you start to lose part part of your Social Security payments for example in 2024 the limit is $223 120 if you earn more than this your benefits will be reduced the good news is that this limit will increase in 2025 allowing you to earn more before your benefits are affected this change is particularly important as more older Americans are staying the workforce longer or returning to work because their social security benefits aren't covering all their expenses however remember that for every $2 you earn over the limit you'll lose $1 in benefits until you reach full retirement age number four delayed full retirement age the fourth change involves the age at which you can claim full Social Security benefits without any penalties this is a significant shift that has been phased in over the years if you turn 66 in 2024 you can claim your full benefits at 66 years and 8 months however for those turning 66 in 2025 the full retirement age will be 66 years and 10 months this might not seem like a big difference but it means that if you claim benefits earlier you'll face penalties that reduce your monthly payments planning ahead is crucial to maximize your benefits especially as the full retirement age continues to inch closer to 67 for future retirees number five increased income subject to Social Security taxes finally let's talk about one of the most significant changes the income cap for Social Security taxes in 2024 the cap is set at $168,600 meaning that any income above this amount isn't subject to Social Security taxes however this cap is indexed to inflation so it will increase in 20125 what's more there's a growing debate in Congress about raising this cap even further potentially up to $400,000 this proposal primarily supported by democrats aims to increase the Social Security trust fund solvency by requiring higher earners to contribute more on the other hand Republicans argue that any increase should be applied uniformly so everyone not just the wealthy pays into the system equally this could result in a higher tax bill for those earning more but also potentially more benefits when they retire what to expect from the Social Security Fairness Act Beyond these five changes there's also ongoing legislative action that could impact Social Security in the near future one key piece of legislation is the Social Security Fairness Act which has been gained Traction in Congress this bill aims to repeal the windfall elimination provision WEP and the government pension offset gopo both of which have been controversial for years these Provisions red produce Social Security benefits for individuals who also receive a pension from a job that didn't withhold Social Security taxes such as certain government positions the bill currently has 325 co-sponsors and only needs 218 signatures to force a vote while it's unclear whether this will pass before the upcoming election it's something to watch closely as it could significantly impact millions of Americans to wrap this update while the upcoming changes to social security may seem daunting staying inform formed and planning ahead as your best defense the decisions made in Congress over the next year will shape the future of social security so it's crucial to stay engaged and understand how these changes will affect you if you have any questions about social security drop them in the comments below and as always thank you for watching be sure to subscribe for daily updates see you in the next video