Beneficiaries can look ahead to an average increase of about $50 a month, pushing the average payment from $1,927 to $1,976.
Yet, even with the increase, for many retirees, the adjustment will not quite keep pace with rising living costs. “I think overall folks are glad to see the raise. It’s not necessarily keeping up with everything, but it’s better than nothing,” says Jim Blair, founder of National Social Security Advisors and a former Social Security administrator.
How retirees can increase their Social Security benefits in 2025
Following are the two major ways retirees can increase their Social Security benefits in 2025:
- Change your tax withholdings
Social Security benefits are subject to federal income taxes. Beneficiaries can ask the government to withhold a portion of their benefits for payment of these taxes. The rates at which benefits may be withheld are 7%, 10%, 12%, or 22% of the monthly benefit.
If you are having trouble keeping up with expenses, and you’re in a lower tax bracket, adjusting your withholding rate can provide more immediate income. This would mean that less is taken out, leaving more money in your pocket each month, although it may result in a smaller refund or a tax bill during the next filing season.
To have taxes withheld from your Social Security benefits, you’ll need to file Form W-4V, Voluntary Withholding Request, with the Social Security Administration. You can use this form to specify a percent of your benefit amount you want withheld for federal taxes.
- Request an income-related monthly adjustment amount reconsideration:
Generally speaking, Medicare Part B and Part D premiums are income-based. Beneficiaries with higher incomes pay an additional amount called the Income Related Monthly Adjustment Amount, or IRMAA. The general rule of thumb is these premiums are based on your tax return from two years ago.
If you experience a life-changing event that reduces your income substantially-retirement, divorce, or death of a spouse-you can request a redetermination of your IRMAA. You may be able to lower the cost of your Medicare premiums and raise your net Social Security benefit.
To apply for this change, complete Form SSA-44 (Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event) and submit it to the Social Security Administration with documentation of your life-changing event and lower income.
Additional factors to consider
While the above strategies can lower your net cost for Social Security benefits, here are some more general considerations:
- Impact on other benefits: Many other benefits are indeed linked to heightened Social Security income, such as Medicaid or SNAP benefits. These, too, may be modified. Some retirees have discovered that returning to work or increasing their income can result in reductions or loss of these vital benefits.
- Delays in increased benefits: While recent legislation, including the Social Security Fairness Act, aims to provide increased benefits for some retirees through the repeal of provisions such as WEP and GPO, administrative issues and funding reasons may delay increased benefits for a period of over one year.
