In 2025, the full retirement age for Social Security will increase, with those born in 1960 and later reaching full benefits at age 67. This change is part of a gradual adjustment initiated by a 1983 law to align with longer life expectancies. Additionally, 2025 will see a smaller cost-of-living adjustment of 2.5%, an increase in maximum taxable earnings to $176,100, and the introduction of appointment-based services at Social Security offices.
The Social Security Administration has announced a 2.5% cost-of-living adjustment (COLA) for 2025, increasing benefits by about $50 per month for the average retiree. Additionally, the maximum taxable earnings limit will rise from $168,600 to $176,100, impacting higher earners who will face taxes on more income. While this may increase tax bills, it also means potentially larger future benefits, with the maximum monthly payment increasing to $5,108. Strategies like delaying benefits and working longer can also help boost Social Security payments.
