Social Security Unveils 2 New Changes After COLA: Big Shifts for Retirees

This week is a big week for retirees as the SSA prepares to release the 2025 COLA. Though there is a small delay, the SSA is finally ready to make its announcement after waiting previously. This is because the final inflation data from September is due in by the 10th of October, and so it takes the SSA some time to get this data.

Additional announcements will follow, but retirees will have to hold on a little longer for the announcement on the increase. Adjustments affecting both active retirees and people who are still contributing to Social Security severally are included.

Social Security Changes

That’s because retirees are eagerly awaiting the upcoming COLA announcement to find out how their benefits will be increased or cut over the next year. The announcement this past Oct. 10 however is more than the COLA.

Other, more important updates—that may affect a lot of people, including those who are still working or receiving Social Security—will also be released by the SSA.

Two big things to watch: updates to the earnings test limits and the wage cap for Social Security taxes. These updates will help impact the financial situation for both current and expected retirees.

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Social Security Announces 2 More New Changes After The COLA

Social Security benefits and income must be managed by beneficiaries who are aware of upcoming changes to Social Security. Those still working and still earning income while living in retirement will need to watch carefully for updates on earnings limits that could have an impact on how much they can earn without a corresponding reduction in benefits.

All Social Security employees have to pay attention to the wage cap—it is what dictates how much of their income is subject to Social Security taxes.

Earnings-Test Limits for 2025

• Social Security should permit beneficiaries to work and receive Social Security benefits, albeit with a cap on earning potential before they reach full retirement age.
• In 2024, if your earnings exceed $22,320, then a certain amount of your retiree’s benefits can be deducted.
• For those who will be full retirement age when they turn 62 in 2024, the cap is higher, at $59,520.
• In fact, these caps are predicted to increase by 2025, which means that retirees can boost their income without diminishing their benefits.
• It should be noted, that once an individual reaches full retirement age, any benefits taken off are returned.

Also Read: Social Security Payments This October: Golden Chance To Get $4001!

The 2025 Social Security Wage Cap

• Another important update for 2025 is the Social Security wage limit. This level limits the amount of income that is responsible for Social Security taxes.
• Any income up to $168,600 in 2024 is boiled down to being free from Social Security taxes or the wage limit for 2024, and anything over that is boat-rocked.
• Under the assumption that the limit will be increased in 2025 to reassure inflation and wage growth.
• The program is funded by higher taxable earnings and even may halt future benefit cuts.

The Importance of Monitoring Social Security Updates for Financial Planning

• While the COLA announcement is the most important, there is still importance in trying to stay on top of all the SSA updates, including wage limit adjustments and earnings test limits.
• These changes also change control limits that retirees see in terms of earnings that won’t affect their benefits and changes to how much money hits the Social Security system.
• On October 10, both current retirees and employees who are looking towards retirement should review these updates.
• Staying on top of Social Security changes improves your financial planning and helps you achieve future security.

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