What is the advantage for retirees who receive the lowest Social Security payment?

Many retirees are not particularly looking forward to receiving their Social Security checks in 2025.

This is because according to projections, the cost-of-living adjustment for next year will likely be substantially lower than the one that was applied to this year’s payments.

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Cost-of-living adjustment projected to be considerably lower for next year

The Senior Citizens League, a non-partisan advocacy group for seniors’ rights, placed its August COLA estimate at 2.57%, an almost 20% drop from last year’s 3.2%. This adjustment rate was announced in October 2023, with beneficiaries receiving the new amounts in January 2024.

Despite the lower projected COLA and subsequent smaller increase in Social Security payments for the coming year, this indicates that inflation is cooling and seniors can expect more affordable goods in the near future.

A slower pace of inflation is a bit of good news, especially when you are collecting the minimum Social Security payment each month.

READ ALSO: Wait to retire to receive maximum Social Security checks

What is the advantage for retirees who receive the lowest Social Security payment?

Even as you receive retirement benefits from the Social Security Administration, you are also allowed to work, although there’s a cap on earnings for those who have not yet reached full retirement age.

If you receive the smallest Social Security payment each month and decide to work part-time to boost your income, you have more leeway in terms of how much you can earn before you reach the threshold where your Social Security check is taxed.

For this year, the earnings limit stands at $22,320 for Social Security beneficiaries, and $59,520 for those who will reach full retirement age before the end of the year.