Here’s what to expect – NBC Chicago

Social Security beneficiaries will soon experience a welcome change, with benefits increasing due to a cost-of-living adjustment.

Recipients will see a 2.5% cost-of-living adjustment in 2025, which is significantly less than the average 3.2% adjustment in 2024. The increase is the lowest cost-of-living adjustment since January 2021 – namely 1.3%.

The increase is intended to help meet higher prices for food, fuel and other goods and services. The average recipient will see an increase of about $50 per month, according to agency officials. Social Security recipients received a 3.2% increase in their benefits in 2024, and some retirees are concerned that this year’s increase won’t be big enough to meet their needs.

Recipients will be informed of their new benefit by post from early December.

Social Security beneficiaries will start seeing the higher payments in January, according to a Social Security Administration news release.

And it’s far from the only change you can expect in the coming months.

Recipients of Supplemental Security Income will also receive increased payments, effective December 31. SSI provides monthly payments to adults and children who have incomes below certain financial limits and are eligible for Social Security benefits.

The other major change will affect those currently working. The taxable ceiling — the maximum amount of income subject to Social Security taxes — will increase from $168,600 to $176,100.

According to the Social Security Administration, the taxable maximum changes every year with changes in the national average wage index.

Are there any other changes?

• The income limit for workers under “full” retirement age will increase to $23,400.
• The income limit for people reaching ‘full’ retirement age in 2025 will rise to $62,160.

Please note: The full retirement age will be 66 years and 10 months in 2025.