For many public sector retirees and their spouses, retirement just got a little lift.
More than 3 million Social Security claimants impacted by the Social Security Fairness Act President Biden signed into law in January will experience a rise in their income by the end of current month.
This law increases monthly Social Security benefits for some types of workers—including some teachers, firefighters, and police officers in many states, federal employees covered by the Civil Service Retirement System, and persons whose employment had been covered by a foreign social security system.
Usually retired employees with a pension based on work not covered by Social Security, these also worked part-time or performed side occupations during their lifetime.
For instance, a teacher who paid into Social Security from a part-time summer job is entitled to benefits. Her access to teacher pensions suggests she might not have received all the Social Security retirement payments she had earned.
Social Security is an earned benefit, thus to be qualified you pay the payroll tax during your working years and the amount you get in benefits depends on your earning background. There is no new cost-of- living (COLA) change here. January brought in the 2025 COLA. Based on the SSA, that 2.5% rise contributed a little under $50 to the average monthly benefit of around $1,900.
For many retirees, there will also be a lump sum payment covering the rise in their pension level back to January 2024 – back pay, if you will. By the end of March, the cash will be deposited directly.
Depending on a number of variables, including the type of Social Security benefit received and the pension amount, the monthly benefit increase might be few hundred dollars to more than $1,000.
The bigger checks will arrive in April (for their March 2025 benefit).
Anyone whose monthly benefit is increased or who will obtain a retroactive payment will get a mailed Social Security notice outlining the modification.
The statute calls off the Government Pension Offset (GPO) and Windfall Elimination Provision (WEP). Along with income they paid taxes on, these clauses either cut or abolished the Social Security benefits of pension recipients for labor that Social Security did not cover.
“There actually is logic in the WEP and the Government Pension Offset (GPO), but it really only made sense to policy experts and actuaries,” author and retirement guru Mark Miller told Yahoo Finance. “For many employees affected by these policies, however, the major benefit cuts surprised them greatly and naturally infuriated them since they appeared so unfair. That’s what drove the several initiatives to change or eliminate the regulations, and Congress at last acted.
The Social Security Administration estimates that roughly 72% of state and municipal public workers are employed in positions covered by Social Security and unaffected by WEP or GPO. Those people won’t get a pay rise.
crackdown in customer service
The Social Security Administration said last week that anyone seeking new benefits or checking benefits has to first confirm their identification online.
This reverses the decades-long policy allowing people to finish the benefit application procedure 100% by toll-free phone line.
For individuals without internet access, especially in rural regions, this is a major barrier. And it boasts senior advocates on high alert.
AARP’s chief advocacy and engagement officer Nancy LeaMond says “The Social Security Administration’s move to force people to visit field offices in person for services they have sought by phone will result in more headaches and longer wait times to resolve routine customer service needs.”
She gets off on the drive to make someone show up for an appointment in an office instead of a phone call from home.
“Requiring rural Americans to enter an office can mean having to take a day off from work and drive for hours only to complete documentation. Any delay in Social Security resulting from this change can entail actual financial difficulty, she said.
Arranging an in-person appointment already requires more than a month.