In January 2025, the Social Security Benefits Act came into effect, marking a significant change for millions of public sector workers. Teachers, law enforcement officers, and many others are now eligible for benefits under this Act. Let’s delve deeper into what the Act entails, who stands to benefit, and how the Boldin Planner can help model restored benefits.
What is the Social Security Fairness Act?
As per the Social Security Administration (SSA), the Social Security Fairness Act aims to revoke two provisions of the Social Security Act that had previously decreased the benefits received by public service employees.
- The Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) are now effectively eliminated by this new legislation. WEP and GPO had previously prevented employees with public pensions from receiving full Social Security benefits, impacting not only the workers but also their surviving spouses and family members.
Who Benefits from the Social Security Fairness Act? And by How Much?
The repercussions of WEP and GPO were primarily felt by state and local government employees who were required to pay into Social Security through multiple jobs.
- It is estimated that around 3 million Americans will witness a boost in their Social Security benefits, potentially amounting to hundreds of dollars every month.
- According to the Congressional Budget Office (CBO), scrapping WEP will raise monthly payments for affected recipients by an average of $360.
- Additionally, eliminating the GPO could mean an average monthly benefit increase of $700 for 380,000 beneficiaries with living spouses, and an average increase of $1,190 for 390,000 surviving spouses receiving widow or widower benefits.
When Will Benefits Be Restored?
The Social Security Administration is currently in the process of evaluating the timeline and method for the restoration of benefits.
- Once implemented, the new law will have a retroactive effect dating back to December 2023, potentially resulting in significant back payments for eligible individuals.
Modeling the Restoration of Benefits in the Boldin Planner
Previously, the Boldin Planner did not account for WEP or GPO benefits. Consequently, the automatic modeling of benefit reductions for users and their dependents was absent.
- New users can now view the accurate benefit amounts they are entitled to under the Social Security Fairness Act through the Boldin Planner.
- Existing users who had disabled the Social Security benefit feature are advised to enable it to visualize their restored benefits. A step-by-step guide on how to activate the spousal Social Security benefit in your plan is available in a video demonstration.
The enactment of the Social Security Benefits Act signifies a positive shift for numerous public sector workers, providing them with increased financial security and recognizing their valuable contributions. It is crucial to stay informed about these changes and utilize tools like the Boldin Planner to maximize the benefits available through this landmark legislation.
Leave feedback about this