Big news has just hit the wires about Social Security benefits! If you or somebody you know has had a reduction in benefits due to the Windfall Elimination Provision (WEP) or the Government Pension Offset (GPO), there’s a huge change that could mean more money in your pocket. Let’s get into what has been announced and how this could impact you or your loved ones.
WEP and GPO: An Overview
To begin with, you must understand the fundamentals of WEP and GPO. For many years, these provisions have hit individuals who served in trades that did not require them to pay into the Social Security system and then receive a pension. This group covers many public employees, such as teachers, firefighters, and police officers.
The WEP has reduced Social Security benefits for nearly three decades for individuals who transitioned from non-Social Security employment to jobs that do contribute to the system. Similarly, the GPO has affected survivors of government employees; the impact of social security survivor benefits is substantially reduced if these survivors also receive a government pension. This situation has affected over 3.2 million people, most of whom were never aware of their reductions until they retired and found their benefits to be much less than what they had anticipated.
The Real Cloud Over the Rainbow: The Social Security Fairness Act
Here’s where it gets interesting. The Social Security Fairness Act is officially on the books, meaning not only are these reductions disappearing for future benefits, but they will be set right retroactively. If you would have made an additional sum starting January 2024, expect a payment for that number of missed months in one lump sum.
Most people should see this payment come through by around the end of March, with increased monthly benefits starting in April. This is a huge shift and a surprise to many a majority of individuals and families.
Processing of Payments: How Soon?
While Social Security originally stated that payments may take up to a year or even longer to roll out, things are moving a lot faster than they had originally thought likely. Most of the time such requests are handled automatically; that is, someone won’t have to do anything; the money will just turn up in their bank account.
However, the payments might take longer for cases with slightly more complicated backgrounds, such as mixed work histories, pension checks, or survivor benefits. The individual will remain in this position must for them to keep a close follow-up and stay alert and proactive.
Act Before It Is Too Late
The first thing to do if you believe you might be affected is to check your Social Security account online or wait for a mailed notice. The Social Security Administration is mailing letters explaining any changes; however, many could find retroactive payments funded into their bank accounts before any official notice reaches them.
If you want to know your new benefit level, please wait until after your April payment is made and landed before getting in touch with Social Security. This would be when the new, higher amount would be reflected in your account.
Re-examining Your Eligibility
Another important point to think about: it may well be worthwhile to recheck eligibility slightly later on, especially for those previously denied Social Security benefits or had reduced benefits. Some individuals might now qualify for benefits they weren’t before, which could mean that you’ll receive a brand new monthly check.
Review Your Eligibility Again
There is another high point that deserves mentioning: if you have had your benefits denied in the past, or if you are facing reduced benefits because of WEP or GPO, now is possibly the best time to re-check your eligibility. Some people may now be eligible for the very benefits that they formerly weren’t, leading to the potential for a whole brand new monthly check for them.
Do You Need to Take Action to Claim These Payments?
For the majority, there is nothing to be done by them to claim these benefits. Most cases are being processed automatically by Social Security. However, if you recently changed your bank have moved house or made any other serious changes to your account, it is good practice to check that your information is correct so that you do not meet with any delays before the cash flows into your account.
Understanding the Financial Impact
The increase in benefits will depend on the person. There are various factors at play in determining the increase: retirement amount, work history in Social Security, and benefits already being received. While some will appreciate only a minimal increase, some experienced a variety of changes, the most substantial of which, often, happened where benefits were previously cut down to slim levels.
Those eligible for retroactive payments are looking at a check, with the figure widely varying by several thousands of dollars based on how much they were shorted. This isn’t merely a minor adjustment but an enormous shift putting money back where it belongs, into the hands of those who earned it.
