New Social Security Law Increases Benefits for 3.2 Million Retirees

Millions of retirees were elated when former President Joe Biden signed the Social Security Fairness Act into law. The new law increases Social Security benefits to more than 3.2 million retirees and their spouses because it eliminates two unpopular provisions. However, retirees who were expecting immediate financial benefits were surprised to learn that receiving their benefits may be delayed.

Social Security Fairness Act

Social Security is a complex program that determines who is eligible for benefits and how much they will receive. The Social Security Fairness Act eliminates two important provisions that have long reduced benefits for some retirees:

-Windfall Elimination Provision (WEP): This provision lowered the Social Security benefits of recipients who have a non-covered pension which does not withhold Social Security taxes. It particularly applies to state and local government employees, teachers, and even some federal workers. WEP applied to more than 2 million Americans last year 2022.

Government Pension Offset (GPO). This provision either reduced or even eliminated Social Security spousal or survivor benefits if the person received a non-covered pension. In 2022, about 734,000 beneficiaries experienced the GPO, which impacts 12.6% of those who receive spousal benefits.

By eliminating WEP and GPO, many retirees along with their spouses would reap large increases in their monthly Social Security checks. According to the Social Security Administration (SSA), some recipients can receive an extra amount as $1,000 or more per month.

February 2025 CalFresh Payments – Here’s When You Can Expect Your Benefits

Changes

The social security fairness act will have different effects on everyone according to his or her non-covered pension and Social Security entitlements. But a $1,000 increase is a big deal, especially when you consider that the average Social Security retirement benefit was $1,926 per month in December 2024. And, of course, retirees have already received a 2.5% Cost-of-Living Adjustment (COLA) for 2025. So, when the SSA implements the new law, retirees affected by WEP and GPO could see a big jump in their total retirement income.

Unexpected Surprise

While retirees have been waiting for their benefit increases, many were caught off guard by an unexpected delay. The SSA recently announced that it is having difficulty effectively implementing the new law due to a lack of funding and staffing.

Why is there a delay?

Lack of additional funding: The bill was passed without additional funding, making it difficult for SSA to recalculate benefits.
Retroactive changes: SSA will need to recompute benefits for over 3 million retirees and implement changes in the background from 2024 onwards.
Staff shortages: SSA is experiencing staff shortages and a hiring freeze until November 2023, which slows down the process.

This means most retirees will have to wait over a year before seeing any rise in their Social Security benefits.

Advice for retirees

If you are impacted by WEP or GPO, remember these considerations during the time SSA is processing your benefits:

Be Patient: The agency has confirmed that payments will be retroactive start of 2024, so you will eventually receive the increase to which you are entitled.
Budget Carefully: Since when you might get your first payment is not clear, avoid making large financial changes based on an assumption that you will get a benefit increase.
Check Eligibility: So, you never applied for spousal benefits because of GPO. Well, check your eligibility again now that the new rules are in place.
SSA updates: Keep checking for updates from SSA’s website or you may contact a representative from Social Security to hear the latest development concerning the new law.

Benefits

Many retirement beneficiaries have not considered avenues for improving their Social Security income. This should be correctly utilized, for instance, defer the benefits to be able to achieve an optimization spousal claim, or apply work history accurately. As many retirees now take advantage of higher payouts in certain cases: A retiree’s annual income increases by $22,924 based on his proper claim choice, while in reality, an extra year’s worth of increased payout will come once the retiree reaches retirement. Meanwhile, proper budgeting and research on other forms of retirement income may be useful.

$1702 PFD Direct Deposit Checks 2025

FAQs

Q. What is the Social Security Fairness Act?

A.It takes away the WEP and GPO provisions and adds up benefits for retired people.

Q. Who will benefit from the new law?

A.Over 3.2 million retirees benefit.