The new Social Security Fairness Act in the United States seems like good news for thousands of American citizens, as their benefits from the Administration are going to increase. However, this process can take “up to a year”, so recipients of this new assistance are going to suffer long delays in receiving their payments. The Social Security Administration claims that it “does not have the funds to implement the adjustments without negatively affecting daily customer service”. This institution, therefore, also indicates that this new policy is further hampered by a hiring freeze implemented in November 2024.
The Social Security Fairness Act, signed into law by former President Joe Biden on January 5, repealed two long-standing provisions: the disregard of windfall gains and government pension offset. These provisions had previously prevented millions of Americans from receiving Social Security benefits if they were already eligible for a pension or retirement program from their job. This new measure mainly affected workers who were teachers, firefighters, police officers or other employees with jobs in the public service.
New retirement age in the United States by 2025
Retirement is another of the big issues facing the American organizations responsible for managing these matters. In fact, the Congressional Budget Office estimated that the end of the Windfall Elimination Provision would increase monthly benefits by an average of $360 for more than two million Americans affected. For its part, the CBO deduced that the repeal of the Government Pension Offset provision would increase monthly benefits by $700 on average for around 380,000 spouses of deceased Social Security beneficiaries.
Similarly, another 390,000 spouses were also expected to see an increase of $1,190 per month, if they themselves were affected by a provision that reduced or eliminated their own Social Security benefits. However, the new payments are expected to put even more pressure on the Social Security Trust Funds, which are facing an imminent insolvency crisis.
The year 2025, therefore, brings important developments for retired people in the United States, especially in relation to the retirement age and Social Security benefits. These changes will impact both those who are close to retirement and those who are already receiving benefits. Although it is possible to start receiving benefits from the age of 62, doing so before full retirement age entails a permanent reduction in monthly benefits.
- In 2025, the full retirement age will be 66 years and 8 months for people born in 1958 and the first two months of 1959.
- Born in 1960 or later: this group will reach full retirement age at 67.
Thus, according to the Social Security Administration (SSA), for every year you postpone your retirement beyond full retirement age, the amount of your pension will increase. Delaying retirement can be a strategic option for maximizing monthly benefits.
