Biden Signs Social Security Fairness Act: When Do Higher Payments Start?

into law on Sunday.

with bipartisan support.

Contacted the Biden administration for further comment via email on Sunday evening.

What does the Social Security Fairness Act do?

This is the most significant revision to the Social Security Act in years, decades that is.

This measure will extend full benefits to millions of public sector retirees who previously received reduced payouts because of the Windfall Elimination Provision and the Government Pension Offset. These workers and their supporters have long argued that these provisions are unjust.

President Biden stated on Sunday that this legislation will result in a $360 monthly increase for around 2.8 million Social Security beneficiaries.

Over the past several weeks, from November to December, critics have been warning that further strain is placed on the Social Security program and expressing concern about how to keep it afloat as it faces the very real possibility of being insolvent.

If no action is taken by lawmakers beforehand.

Upcoming Social Security Payment Increases Worth Knowing About Are you looking forward to receiving larger Social Security checks? To boost morale and make ends meet, many retirees and disabled individuals eagerly anticipate annual Social Security increases. These cost-of-living adjustments (COLAs) help keep recipients' purchasing power intact in the face of rising living expenses. To stay updated on upcoming payment increases, consider the following timelines:
Numbers to Keep in Mind:
1. 2024 Cost of Living Adjustment (COLA) Rate: 6.2%
2. 2023 Cost of Living Adjustment (COLA) Rate: 8.7%
3. 2022 Cost of Living Adjustment (COLA) Rate: 5.9%
Squeezing the Most Out of Your Social Security Benefits
You may have questions like "What drives the annual COLA calculation?" or "Why are some years more generous than others?" Don't be afraid to ask questions or seek clarification.

According to a recent estimate from the Congressional Budget Office, removing the existing rule could result in monthly benefit increases of approximately $360 on average for those who would be affected by the end of 2025.

Ending the GPO would lead to significant increases in benefits for thousands of recipients by the end of 2025. Specifically, it would boost monthly payments by an average of $700 for around 380,000 people receiving benefits based on a living spouse's income. On the other hand, the 390,000 surviving spouses who receive widow or widower benefits would see their monthly payments rise by roughly $1,190.

Will the Social Security Fairness Act apply to existing laws and be retroactive to benefit past recipients?

The law is now in effect, and retroactive payments related to the Social Security Fairness Act will be made from January of next year.

These amounts will grow over time as a result of regular cost-of-living adjustments made by Social Security, which will now be retroactive to January 2024, according to the Social Security Fairness Act.

The law passed by Congress decrees that the Social Security commissioner "must adjust primary benefit amounts as needed" to account for any changes in the law.

It has yet to be determined how this change will be implemented, or whether affected individuals will be required to take any specific steps.

Who Will Get Higher Social Security Benefits

For many years, Americans have received smaller Social Security benefits when they meet the criteria for both WEP and GPO.

Approximately 3 million public sector workers, including police officers, firefighters, and teachers, have seen their benefits significantly reduced because their pensions did not qualify for Social Security coverage.

The International Association of Fire Fighters (IAFF) has approximately 320,000 active members, not counting the hundreds of thousands of retired firefighters who will also receive benefits from the new Social Security law.

The Social Security Fairness Act would affect most permanent civilian federal employees who were hired before 1984, as well as about 28 percent of state and local government employees covered by different retirement plans.

Although the Windfall Elimination Provision (WEP) reduces benefits for retirees or disabled future retirees who have fewer than 30 years with significant earnings covered by Social Security, the Government Pension Offset (GPO) targets the spouses of retirees who collect a government pension.

The Congressional Research Service estimated that as of December 2023, about 745,679 individuals, representing around 1% of all Social Security recipients, faced reduced benefits due to the Government Pension Offset (GPO). Similarly, approximately 2.1 million people, roughly 3% of all beneficiaries, were impacted by the Windfall Elimination Provision (WEP).

What People Are Saying

It's only right that individuals who have dedicated themselves to a lifetime of hard work and honest labor should be able to retire with a sense of financial stability and respect.

Kelly stated that firefighters nationwide are "thrilled to see this shift, having corrected a 40-year injustice." She noted that the policy had a significant impact on surviving spouses of firefighters who had contributed their own Social Security benefits but were exploited by the government's pension system. Kelly pointed out that this decision is particularly beneficial to low-income firefighters, allowing them to retire without financial burdens.

More than two million dedicated public servants who've spent their careers earning Social Security benefits will now have access to the retirement they've worked towards, and at long last be able to reap the rewards of their hard-earned labor.

Social Security is a fundamental part of America's middle class. You work for 40 quarters, you deserve it, it should be yours when you retire. All these workers are simply asking for what they've earned.

"This is a truly historic moment brought about by President Biden signing the Social Security Fairness Act today. This new law finally puts right a 50-year wrong that has caused certain government retirees to lose out on their Social Security benefits or see them reduced. What Americans want is a bipartisan solution, not drastic proposals from Congress to increase the retirement age, impose means testing, freeze cost-of-living adjustments, or even privatize Social Security, which have been put forward by some.

It was a tremendous honor to be in the White House with the President as he signed the Social Security Fairness Act into law, marking the end of a decades-long crusade by our organization to abolish WEP and GPO and ensure public servants receive their hard-earned Social Security benefits.

We let short-term needs dictate our decisions rather than making a long-term commitment to sustainability.

What Happens Next

Supporters claim that the Social Security Fairness Act rectifies a persistent inequity, but it will also put additional pressure on the Social Security Trust Funds, which are facing an impending financial crisis.

The Social Security Administration is running the risk of running out of funds as soon as the mid-2030s. By then, it will only be able to pay out about 80% of the benefits that recipients have earned through their working years.

The Social Security Administration is expected to release additional information soon on how they plan to carry out the new law. Keep an eye out for any updates on their plans.

Reporting by The Associated Press aided in the creation of this report.

Update: January 6, 2025, 10:26 a.m. Eastern Time: This article has been updated with additional information.

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