You Won’t Believe How Much Your Social Security Check Is Going Up in 2025—See the Exact Numbers
In 2025, millions of Americans will see their Social Security checks increase, thanks to a 2.5% Cost-of-Living Adjustment (COLA) announced by the Social Security Administration (SSA).
While this adjustment is more modest compared to the significant hikes in recent years, it still represents a meaningful boost for beneficiaries striving to keep pace with inflation.
Understanding the 2025 COLA
The 2.5% COLA for 2025 is the smallest increase since 2020, reflecting a cooling in inflation following the post-pandemic surge. This adjustment affects over 72.5 million Americans receiving Social Security and Supplemental Security Income (SSI) benefits. The increase will be reflected in payments starting January 2025 for Social Security beneficiaries and December 31, 2024, for SSI recipients.
How Much More Will You Receive?
The average retired worker will see their monthly benefit rise from $1,927 to approximately $1,976, translating to an increase of about $49. For those receiving disability benefits, the average payment will increase from $1,542 to $1,580.
Survivor benefits will also see a rise, with the average payment moving from $1,788 to $1,832.
To estimate your specific increase, multiply your current monthly benefit by 2.5%. For example, if you currently receive $2,000 per month, your new benefit would be $2,050.
Changes to Maximum Taxable Earnings
In 2025, the maximum amount of earnings subject to Social Security tax will increase from $168,600 to $176,100. This change means higher earners will contribute more to the system before reaching the tax cap. The Social Security tax rate remains unchanged at 6.2% for employees and 12.
4% for self-employed individuals.
Adjustments to Retirement Earnings Test
The Retirement Earnings Test (RET) is a key component of the Social Security system that affects individuals who begin collecting benefits before reaching their full retirement age (FRA) while continuing to work.
The premise behind the RET is to balance early benefit collection with ongoing employment income, ensuring that those who claim early don’t receive disproportionate advantages over those who delay.
In 2025, the annual earnings limits under this test are being adjusted upward, in line with the general cost-of-living trends and wage growth.
For individuals who are under full retirement age for the entirety of 2025, the earnings limit has been raised to $23,400 annually, or $1,950 per month. This means you can earn up to this amount without any reduction in your Social Security benefits.
However, if your earnings exceed this threshold, the SSA will withhold $1 in benefits for every $2 you earn above the limit.
While this might seem punitive at first glance, it’s important to remember that these withheld benefits aren’t lost forever—they are recalculated and added back into your monthly payments once you reach full retirement age, potentially increasing your lifelong benefit total.
For those reaching their FRA in 2025, a more generous earnings cap applies. These individuals can earn up to $62,160 in the months leading up to their FRA without seeing a reduction in benefits. For earnings above that level, the SSA withholds $1 in benefits for every $3 earned.
This more lenient threshold acknowledges that people approaching full retirement age may still be actively employed and contributes to easing the transition into retirement. Once FRA is reached, the RET no longer applies, and beneficiaries can earn any amount without penalty.
These adjustments offer a clearer pathway for older workers navigating the balance between employment and early benefit collection.
Many Americans choose to work longer either out of financial necessity or personal preference, and the RET allows for some flexibility while still maintaining the financial integrity of the Social Security system.
However, these rules also make it essential for pre-retirees to carefully plan when to start claiming benefits and how that decision interacts with their work income.