If you receive Social Security benefits, you have probably adjusted to your updated payments over the past few months due to the 2.5% cost-of-living adjustment (COLA) implemented in January. Typically, your benefit amount wouldn’t change for the remainder of the year. However, 2025 is turning out to be far from typical when it comes to Social Security.
Four key changes are about to go into effect. Some could improve your life while others could lead to new headaches or may not affect you at all. But they're still worth keeping in the back of your mind in case you encounter them in the future.
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1. Increased benefits for countless seniors impacted by the Social Security Fairness Act
President Biden signed the Social Security Fairness Act During his last days in office, he eliminated two clauses that decreased benefits for retirees receiving pensions from non-Social Security-covered employers, impacting numerous firefighters, police officers, and teachers.
Around 3.2 million recipients are impacted by this alteration in the rules, encompassing certain widows and widowers. spousal beneficiaries The legislation affects all benefits paid out after December 2023. Numerous qualifying elderly individuals were issued a single retroactive payment in March, which covered the outstanding benefits owed to them.
Retirees who are impacted will experience a permanent boost in their monthly benefits as well. This change will mostly take effect with the April 2025 payment. Based on estimates from the Congressional Budget Office, the typical retired worker can expect an additional $360 each month. Meanwhile, spousal recipients will likely see an extra $700 per month, and those eligible widows or widowers should anticipate an average increase of approximately $1,190 every month.
Nevertheless, certain intricate cases have remained beyond the capabilities of automation within the Social Security Administration. Should your situation fall into one of these categories, it might take up to a year to obtain the funds due to you under the Social Security Fairness Act. If you think this legislation impacts you and your payments in April 2025 mirror those from March, contact the Social Security Administration for further details.
2. Stricter identity confirmation regulations
Starting from April 14, 2025, the Social Security Administration will implement stricter identity verification processes aimed at enhancing protection of Social Security records and benefits from fraudulent activities. Individuals utilizing their my Social Security account To make alterations such as updating your address or changing your direct deposit information will go unnoticed.
However, individuals who opt to submit their applications for benefits or modify them through alternative means will be required to go to a Social Security office personally. The only exceptions are people who are applying for Medicare, disability benefits, or Supplemental Security Income (SSI).
With the updated regulations, you can start your Social Security application via telephone should you choose to do so. However, finishing the process requires visiting a local Social Security office in person to show your ID for verification purposes.
The Social Security Administration offers an online resource that can assist you. find your closest field office This could perhaps benefit from a second look, despite your prior visits to a nearby Social Security office. Many governmental offices have shut down this year, which means the location you used to go to might now be inaccessible.
If visiting in person isn’t preferable for you, think about setting up a My Social Security account if you haven’t done so yet. Initially, when establishing your profile, you will need to respond to several identity verification queries to confirm your authenticity. However, after completing these steps, you can access your information using just a username and password whenever updates are needed.
3. Accelerated implementation of direct deposit updates
Previously, altering the bank account where the Social Security Administration deposited your benefits took around 30 days. From now on, this process will be completed within just one business day.
You have the option to update your direct deposit details through your My Social Security account. Alternatively, if you prefer not to make changes online, you can call them to request the modification up until April 14, 2025.
4. Go back to achieving a full 100% recovery rate for overpayments.
Occasionally, the Social Security Administration may make an error leading to excess payments to recipients. In such cases, they have the right to reclaim these funds through subsequent disbursements. However, under the Biden Administration’s guidelines implemented for 2024, the repayment rate has been limited to whichever is higher: either $10 or 10 percent of each payment received.
If your typical monthly Social Security benefits amount to $2,000 but one month you receive $3,000, the Social Security Administration might deduct $100 from subsequent payments—so you would only get $1,900 per month—until they have recovered the excess $1,000.
The administration under President Trump has restored the full overpayment recovery rate of 100%, which was applicable before 2024. This change impacts all fresh overpayments made starting from March 27, 2025. For those who incurred overpayments earlier than this date, the previous limit of a 10% recovery rate remains unchanged. Additionally, Supplemental Security Income (SSI) continues to enforce an overpayment recovery rate capped at 10%.
This alteration implies that you might not receive any funds from Social Security for a period if you received excess payments previously. For retired individuals, this could pose challenges; some may have already used up the additional amount assuming there was no mistake.
If losing your Social Security benefits due to overpayment recovery is not an option for you, reach out to your nearest Social Security office to ask for a reduced repayment rate. Additionally, appeal the overpayment decision The Social Security Administration might choose to exempt you from repaying an overpayment, letting you retain the additional funds, provided you demonstrate that the error leading to the overpayment wasn’t due to your actions and that you lack the financial means to repay it.
Should you have any queries regarding these Social Security updates, it's advisable to reach out to the Social Security Administration directly.
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