Educators and Public Servants Finally See Increased Social Security Benefits
Let me tell you about Sarah, a long-time kindergarten teacher. Sarah looked forward to a modest retirement supported by her Teacher Retirement System pension and her late husband’s social security benefits. She met with me before announcing her retirement to make sure that she was ready to retire. After reviewing her social security benefits, Sarah was distraught to learn that the Government Pension Offset (GPO) would completely eliminate her Social Security Survivor benefits due to her TRS pension, and the Windfall Elimination Provision (WEP) would substantially reduce her own social security benefits – both of which weren’t reflected on any of her social security statements. Her plans for a comfortable retirement were delayed, but we were able to develop a plan that put her on track again for a successful retirement in a few years. Fortunately, Sarah’s plan just changed for the better.
The Social Security Fairness Act was signed into law on January 5th, 2025, and repealed both the WEP and GPO, retroactive to January 1, 2024. Affected retirees will now receive their full Social Security benefits, and any reductions since January 2024 will be reimbursed. Now, Sarah’s own Social Security benefits and her survivor benefits will be fully restored. Not only will she receive an additional $1,300 per month from Social Security moving forward as a survivor benefit, but she will also receive retroactive payments for the reductions dating back to January 2024.
The WEP and GPO faced criticism for decades, especially since the professions most affected were teachers, police officers, firefighters, and other public servants who often make sacrifices for others. With the elimination of the WEP and GPO, many millions of retirees will see their benefits increase hundreds or even thousands of dollars per month. For Sarah, this change will mean that she can finally retire and enjoy spending more time with her grandchildren.
If you have already filed for Social Security, make sure you have applied for spousal or survivor benefits if applicable. Some workers who’s Spousal or Survivor benefits were eliminated due to the GPO might never have filed for the additional benefit, but might have higher benefits now with the repeal of the GPO. Contact the Social Security Administration to file for Spousal or Survivor benefits now if this is your case.
If you have not yet filed for Social Security benefits, now is the time to revisit your Social Security plan with a CFP® professional. The additional income from restored benefits could impact your optimal timing for claiming Social Security. For example, perhaps you were previously waiting until age 70 to maximize your own benefits, but now with your higher spousal benefits, the best age to file might be 67 because spousal benefits don’t increase past full retirement age. It is important to work with a financial advisor well versed in these issues to ensure your retirement plan accounts for these changes.
Whether you’re already receiving benefits or planning to file, now is the time to act. Consulting with a CERTIFIED FINANCIAL PLANNER® professional can help you navigate these changes and set you on the path to a secure retirement.
David Faskas, CFA, CFP® is the Chief Investment Officer, Chief Financial Planning Officer, and a managing member of Keller Wealth Advisors.
