Upcoming Changes to Social Security: What Beneficiaries Need to Know for 2025

Social Security beneficiaries are set to receive a 2.5% cost-of-living adjustment (COLA) in 2025, translating to an average $49 monthly increase for retired workers. However, this increase may lead to more retirees facing federal taxation on their benefits, as the income thresholds for taxation have not been adjusted for inflation since their introduction in the 1980s. This situation highlights the double-edged nature of COLA increases, as they can inadvertently expose more retirees to taxes.