The Social Security Fairness Act is a significant new law that promises to positively impact the financial future of many public service workers. If you’ve worked in jobs like teaching, firefighting, postal work, or law enforcement, this new legislation could mean more money in your pocket, both now and in the future. The law is designed to increase Social Security benefit payments for people who have seen their benefits reduced due to the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). This could even include back payments for the year 2024.
What’s Changing with the Social Security Fairness Act?
For years, certain public employees have faced two major rules that reduced their Social Security benefits. These rules have affected people like teachers, firefighters, postal workers, and police officers, who often had pensions from jobs where their employers didn’t withhold Social Security taxes. The Social Security Fairness Act changes that, aiming to boost their financial security by removing these outdated provisions.
- The Windfall Elimination Provision (WEP): The WEP has been in place since 1983. It reduced the Social Security benefits for people who also receive noncovered pensions, which are pensions from jobs that didn’t pay into Social Security. Because of the WEP, many public employees saw their Social Security benefits lowered, despite having worked hard for them.The Congressional Budget Office (CBO) estimates that by eliminating the WEP, an average of $360 in additional benefits will be given to about 2.1 million beneficiaries. The impact could increase even more by 2033. This means a significant boost in Social Security checks for many long-serving public workers.
- The Government Pension Offset (GPO): The GPO has been around since 1977 and was updated in 1983. This rule reduced Social Security benefits for spouses, widows, and widowers who also received a government pension. For example, if someone’s spouse worked for the government and received a pension, their own Social Security benefits would be reduced.With the new law, this offset is being eliminated, and it could lead to a considerable increase in monthly benefits. Spouses could see an increase of around $700 per month, while surviving spouses could see an additional $1,190 by December 2025. By 2033, these increases could rise to $860 for spouses and $1,520 for surviving spouses.
Who Will Benefit from the Act?
Though the WEP and GPO only affect about 4% of all Social Security beneficiaries, the effects on those who are impacted can be huge. Public employees, especially those who worked in critical roles like teaching, policing, or firefighting, may see a much-needed financial boost.
For individuals who qualify under the Social Security Fairness Act, these changes will apply to benefits payable after December 2023. This means those affected can expect back payments for all of 2024, providing immediate financial relief.
Things to Consider
While the increase in Social Security payments is a win for many, it’s essential to be aware of potential changes in other forms of financial assistance. For example, if you also receive Supplemental Nutrition Assistance Program (SNAP) benefits, the increase in Social Security payments could lead to a reduction in your SNAP payments. This is something to keep in mind for those who rely on multiple forms of assistance.
What Do You Need to Do?
If you’ve already filed for Social Security benefits and they were reduced due to the WEP or GPO, you don’t need to take any immediate action. The Social Security Administration (SSA) is working on the details of how to implement the changes, and they will provide updates on their website. It’s a good idea to make sure that your mailing address and direct deposit information are up-to-date, which can be done through the SSA’s online portal, by phone, or in person at your local office.
Stay Informed for the Future
As these changes take effect, it’s important to stay informed about how they might affect your Social Security benefits. Keep an eye out for updates from the Social Security Administration and adjust your financial planning accordingly. These changes could significantly impact your long-term financial security.
If you want to learn more about how these changes could benefit you, or if you’re interested in understanding the full impact of Social Security benefits, take a look at our Social Security and SSDI cheat sheet. Also, explore our guide to see how some individuals could risk losing their Social Security benefits.
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