Suze Orman Reveals Shocking 2025 Social Security Changes That Could Impact Your Future

Starting January 2025, Social Security beneficiaries will receive a 2.5% cost-of-living adjustment (COLA), the smallest increase since 2021. While this adjustment may seem minor compared to the 8.7% hike in 2023, it reflects slowing inflation, signaling positive economic trends. Financial expert Suze Orman recently shared her insights on this change, highlighting Social Security’s critical role for retirees.

Understanding COLA and Its Importance

Social Security’s annual COLA ensures benefits adjust with inflation, protecting retirees’ purchasing power. Unlike IRAs or 401(k)s, Social Security offers guaranteed inflation adjustments. “A smaller COLA means inflation is easing, which is a win for everyone, even if the raise feels modest,” Orman said. She emphasized that beneficiaries who delay claiming benefits still receive COLA adjustments, ensuring they don’t miss out. Waiting until full retirement age (66 or 67, depending on birth year) or age 70 can significantly increase monthly benefits.

Income Limits for Working Beneficiaries

In 2025, beneficiaries under full retirement age (FRA) who continue working face an earnings limit of $23,400, with $1 deducted from benefits for every $2 earned above this threshold. For those reaching FRA in 2025, the limit rises to $62,160. Orman reassured beneficiaries that withheld amounts are temporary: “Once you reach FRA, your benefits are recalculated to restore what was withheld.”

Rising Wage Base for 2025

The Social Security wage base will increase to $176,100 in 2025. This means income up to this cap is subject to Social Security taxes, while earnings above it remain exempt.

Orman advised retirees and future beneficiaries to stay informed about these updates, stressing that even a modest COLA highlights Social Security’s value as a steady, inflation-adjusted income source.