What's Happening
7 minutes ago

Is Now a Good Time to Buy the Dip in Dogecoin?

foolfool.com
11 minutes ago

After Selling 30,000 EVS, Hertz Is Now Chasing Fleet Rotation To Reduce Losses

benzingabenzinga.com
19 minutes ago

Why Airbnb Shares Are Trading Higher By Around 14%; Here Are 20 Stocks Moving Premarket

benzingabenzinga.com
20 minutes ago

Warren Buffett's 4th-Quarter Trades Will Be Revealed Today, but Won't Show His Favorite Stock to Buy. Here's Why.

foolfool.com
26 minutes ago

This Looming Catalyst Could Boost XRP, Dogecoin, and Shiba Inu

foolfool.com
26 minutes ago

Is Estée Lauder an Undervalued Stock Right Now?

foolfool.com
31 minutes ago

Nvidia Stock Investors Just Got Great News From TSMC

foolfool.com
34 minutes ago

Here's How Generative AI Factors Into Amazon's Plan for Growth

foolfool.com
35 minutes ago

Billionaire David Tepper of Appaloosa Is Buying Shares of Nvidia and Dumping a Key Artificial Intelligence (AI) Rival

foolfool.com
38 minutes ago

Can You Retire at 55? What the FIRE Movement Says You'll Need to Do

foolfool.com
39 minutes ago

Billionaire Peter Thiel-Backed Crypto Startup Plasma Raises $20M To Develop Bitcoin-Based Stablecoin Network

benzingabenzinga.com
41 minutes ago

Massive News for Super Micro Stock Investors

foolfool.com
41 minutes ago

Alphabet's Revenue Miss in Q4 Isn't the Only Reason Investors Should Be Concerned About the Stock

foolfool.com
50 minutes ago

Arthur Hayes Says Trump Coin Will Lead Bitcoin If Market Sentiment Turns Favorable, Calls Memecoin 'Purest And Most Honest Popularity Metric'

benzingabenzinga.com
51 minutes ago

Vertex Pharmaceuticals Gets a Huge FDA Approval Which Could Send the Stock Skyrocketing

foolfool.com
56 minutes ago

Where Will Palantir Technologies Be in 5 Years?

foolfool.com
58 minutes ago

Mark Zuckerberg's Meta Faces Backlash As Laid-Off Workers Say They Were Unfairly Targeted Despite Strong Performance Records

benzingabenzinga.com
59 minutes ago

Warren Buffett Owns 1 Vanguard Index Fund, and It Could Soar 147%, According to a Top Wall Street Analyst

foolfool.com
1 hour ago

With Little Moves and Big Results, Devon Energy Is Succeeding in ExxonMobil and Chevron's Shadow

foolfool.com
1 hour ago

Elon Musk's Boring Company To Build 'Dubai Loop' To Handle Upto 100,000 Passengers Per Hour, Slashing Travel Time With Electric Vehicles

benzingabenzinga.com

Social Security Won’t Just Announce a 2025 COLA This Week. Here Are 2 More Big Changes to Look Out For

It’s the week retirees have long been waiting for. At long last, the Social Security Administration (SSA) is gearing up to announce a 2025 cost-of-living adjustment (COLA).

And if you’re wondering what’s taking so long, the answer is that the SSA needs to wait for September inflation data to become available to arrive at that number. Since that data won’t come out until October 10, retirees will be in limbo for a few more days with regard to a 2025 COLA.

A person at a laptop holding a dog.

Image source: Getty Images.

But it’s not just next year’s COLA that gets announced on October 10. The SSA will be able to offer a few other key updates on 2025 changes. Here are two pieces of information you’ll want to look out for.

1. The 2025 earnings-test limits

One nice feature of Social Security is that you’re allowed to earn an income and collect benefits at the same time. And once you reach full retirement age, wages from a job won’t impact your monthly benefits (other than perhaps, in some cases, boost your earnings history and give your benefits a lift).

But if you’re on Social Security and earning money from a job before having reached full retirement age, there’s an earnings-test limit you’ll be subject to. And the higher it is, the more leeway you get to earn money before having some of your Social Security income withheld.

Currently, the wage cap is $22,320, or $59,520 for those who aren’t yet at full retirement age but will get there prior to the end of 2024. In 2025, these limits are likely to rise, so you may be able to earn more without risking withheld benefits.

And to be clear, withheld benefits aren’t forfeited. You get the money back at full retirement age. But that doesn’t necessarily help your near-term finances if full retirement age is still a few years away.

2. The 2025 wage cap

Workers don’t necessarily pay Social Security taxes on all of their income. Rather, a wage cap is established each year that dictates how much income is taxed for that purpose.

In 2024, the wage cap is $168,600, so earnings beyond that point are exempt from Social Security taxes (though to be clear, that doesn’t mean higher earnings are exempt from federal and state taxes). For 2025, a higher wage cap will likely be set in accordance with inflation and wage growth.

Now if you’re someone collecting Social Security, you might assume that this update isn’t so important to you. But actually, it is.

Social Security is facing a revenue crisis that has the potential to result in benefit cuts in roughly a decade’s time. A sizable boost in the Social Security wage cap serves the purpose of pumping more money into the program, which is a piece of the puzzle in the context of avoiding benefit cuts.

There’s a lot of hype about the upcoming 2025 Social Security COLA announcement. But realize that there’s other key information that’s set to be shared on October 10. Visit the SSA’s website that day either way and read through that news carefully so you know what to expect in the new year.

The $22,924 Social Security bonus most retirees completely overlook

If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we’re all after. Simply click here to discover how to learn more about these strategies.

View the “Social Security secrets” »

The Motley Fool has a disclosure policy.

Related Posts

The average retirement age in the U.S. was 62 in 2023, but that number’s been slowly ticking up over time. Rising life expectancies and rising

While the stock market is still thriving, some investors may be feeling wary about the future. Spiking inflation could cause the Federal Reserve to shift

There are plenty of ways to become a millionaire, like starting a successful business, being a professional athlete, or becoming a movie star. For most

Sadly, a lot of people go into retirement with minimal savings. But if you’re gearing up to retire this year, you’ve hopefully managed to amass