The month of April began with a major change in our contribution system, precisely one that had been feared since 2021. The White House has just announced a new change in Social Security payments, although perhaps not the one we had expected. In a few months, thousands of people will start receiving more and others, unfortunately, will start receiving less: watch out for the retirees with what will happen to them.
New change in Social Security: thousands of people to receive more money
A recent change in Social Security payments means that certain groups will be receiving more money from the program. This is good news for seniors and people with disabilities who rely on Social Security for a significant portion of their income.
One of the biggest changes is an increase in the Cost of Living Adjustment (COLA). The COLA helps benefits keep pace with inflation annually. For 2023, the COLA was increased substantially to 8.7% in response to high inflation. This is the largest COLA increase in over 40 years.
As a result, the average retiree benefit will increase by more than $140 per month. This extra money can help seniors afford necessities like food, housing, transportation, and medical care. In addition to the COLA boost, changes have been made to the Social Security earnings limit.
Previously, seniors who worked while collecting benefits would see a reduction in their payments if they earned over a certain threshold. However, this earnings limit has been eliminated for anyone over the full retirement age. This means they can work and earn as much as they want without losing any benefits.
Seniors over 70, watch out for this change in Social Security: it’s imminent
Recent changes to Social Security will provide higher payments for seniors over age 70. Under the new law, Social Security beneficiaries once they turn 70 will receive an additional 5% boost to their monthly benefits. This was one of the electoral promises, and it has been fulfilled in 2024.
This change aims to provide more financial security for older retirees who often face higher medical costs and expenses later in life. The 5% increase will be applied automatically each year after a beneficiary reaches 70 years old. On the other hand, the minimum income level to receive the subsidy remains the same.
Over the course of their retirement, this added boost can significantly improve seniors’ quality of life. Many seniors rely heavily on Social Security as their primary income source, so even a small percentage increase can make a meaningful difference.
The new Social Security law hides more changes: these are the ones that have been announced
One of the key changes in the new Social Security law is the elimination of the earnings limit for some recipients. Previously, Social Security recipients under the full retirement age had a limit on how much additional income they could earn while collecting benefits.
The new law eliminates this earnings limit for individuals who have reached the full retirement age. This means that once a recipient hits full retirement age, currently 66 or 67 depending on birth year, they can earn any amount through wages or self-employment without facing a reduction in their Social Security benefits.
This change will allow older Americans to continue working and earning income without being penalized through lower Social Security payments. Proponents argue it provides greater flexibility and removes barriers to working in retirement years.
However, critics counter that it disproportionately benefits higher-income seniors who have jobs allowing additional earnings. Overall, the elimination of the earnings limit past full retirement age opens up new opportunities for some Social Security beneficiaries to grow their income without losing the benefits.
This new change in Social Security payments will be marked by the discontent of thousands of families, but also by the satisfaction of retirees who will begin to receive more. The truth is that this is not the only change that the administration has confirmed, we have also seen that regularized migrants will have a new contribution system, which we will soon tell you about (because it will affect you, although not in the way you expect).
