7 Biggest Social Security Changes Coming in 2025, part 2

The cost-of-living adjustment (COLA) may be the most widely anticipated way Social Security changes from year to year, but it’s far from the only one. Inflation, wage trends and new policies directly affect not just the more than 68 million people receiving Social Security benefits but also the estimated 184 million workers (and future beneficiaries) paying into the system. 

5. Social Security taxes
Social Security is primarily funded by a 12.4 percent tax on most workers’ earnings. If you earn wages, you pay 6.2 percent (through FICA withholding from your paycheck) and your employer pays 6.2 percent. Self-employed people pay both shares as part of their annual tax return.

The rate has not changed since 1990, but the amount of income subject to it is adjusted annually to reflect national wage trends. In 2025, you’ll pay the tax on work income up to $176,100 (up from $168,600 in 2024). Earnings above that threshold are not taxed for the purpose of funding Social Security, nor is any income from investments.

6. Qualifying for benefits
The first step in qualifying for Social Security retirement benefits is having at least 40 Social Security credits. You earn credits, or “quarters of coverage” in SSA parlance, by doing work in which you pay Social Security taxes on your income. You can earn up to four credits a year, so most workers reach the eligibility threshold after 10 years in the labor force.

In 2025, you earn one credit for earnings of $1,810 ($80 more than the 2024 level), so you bank your maximum of four credits when your work income for the year reaches $7,240.

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