
Managing Money
3 groups impacted by Social Security changes 2025
Several changes to Social Security have gone into effect this year, impacting the nearly 68 million people who receive Social Security payments. Some of these changes are great news for beneficiaries — especially those who may be low on retirement savings.
The cost-of-living adjustment (COLA) is aimed at keeping Social Security payments in line with inflation, so beneficiaries can maintain their purchasing power as living costs rise. Benefits have increased by 2.5% as of January, according to the Social Security Administration (SSA), which bumps up retirement benefits by an average of roughly $50 each month.
This increase is slightly less than the current annual inflation rate of 2.7%, which continues to cool from 2022 highs.
In 2024, for example, the COLA was set at 3.2%, and in 2023 — during a highly inflationary period — the COLA was a whopping 8.7%. So, while this year’s COLA is much lower, it’s in line with a cooling inflationary environment.
The maximum benefit for someone retiring at full retirement age (FRA) has also increased, which could result in a bigger check. In 2024, the maximum benefit was $3,822. This year, the maximum benefit is $4,018 — and this would reach $5,108 for anyone who waits until they turn 70 to claim their benefits.
But these aren’t the only adjustments. Here’s what you need to know about the changes and three major groups that will be impacted.