As discussions about retirement and Social Security continue to take center stage, many Americans, particularly public service workers, have advocated tirelessly for legislation that would lead to a Social Security benefit increase.
After nearly 40 years, President Biden signed new legislation repealing two long-standing provisions: the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). Prior to the repeal, these rules reduced or eliminated Social Security benefits for more than 2 million retirees.
Now, thanks to the Social Security Fairness Act retired public servants and their spouses could see a Social Security benefit increase of $360 per month on average. Let’s explore what’s happening and how it may impact your retirement income.
The Social Security Fairness Act
Signed into law on January 5, 2025, the bipartisan Social Security Fairness Act (ACT) eliminates the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) – two long-standing provisions that reduced or even eliminated benefits for more than 2.8 million Americans whose former employment did not cover Social Security taxes and received a “non-covered pension”.
The Act’s origin dates back to the early 2000s, as retirees, educators, fire responders, and advocacy groups raised rightful concerns about the disproportionate impact of WEP and GPO provisions. Its primary goal is to ensure public employees who have contributed to their own pension systems are not penalized when collecting Social Security and to provide fair treatment across different sectors of the workforce.
By repealing WEP and GPO, the Act significantly increases Social Security benefits for certain categories of workers, including:
- Teachers, firefighters, and police officers in states where public sector jobs do not participate in Social Security
- Federal employees who are covered under the Civil Service Retirement System (CSRS)
- Individuals with international work histories, whose employment was covered by a foreign social security system
For these workers, the repeal restores access to full benefits they earned, bringing greater fairness and financial security to retirement.
Glimpse into the WEP and GPO
Windfall Elimination Provision (WEP)
The Windfall Elimination Provision (WEP) was a provision that could reduce an individual’s Social Security retirement or disability benefits if they received a pension from a job that did not withhold Social Security taxes, known as a non-covered pension.
If you worked in a job, such as a teacher, first responder, or federal role, where you did not pay into Social Security, but also worked other jobs where you did, that would make you eligible for Social Security benefits and a government pension. The WEP was designed to prevent what the law considers a “windfall”, i.e. getting full Social Security benefits in addition to a non-covered pension, essentially penalizing people who split their careers between covered and non-covered work.
Government Pension Offset (GPO)
The Government Pension Offset (GPO) is a provision that reduced or eliminated Social Security spousal or survivor benefits for individuals who received a government pension from a job that did not withhold Social Security taxes.
If you are entitled to Social Security benefits as a spouse, widow, or widower, but you also receive a non-covered pension, the GPO applies and will reduce your spousal or survivor benefit by two-thirds of your government pension.
The GPO significantly reduces, or even completely wipes out, Social Security benefits for widows or widowers who also have public pensions, creating a hardship for retirees who expected to rely on both sources of income.
What the WEP and GPO Changes Mean For You
Beginning February 25, 2025, certain beneficiaries will see a monthly Social Security benefit increase. The exact adjustment will vary based on the type of Social Security benefit received and the individual’s pension amount, but some recipients could see an increase of more than $1,000 each month. As of July 7, 2025, Social Security Administration (SSA) has completed 3.1 million payments, totaling $17 billion of adjustments to 2.8 million qualifying beneficiaries.
The SSA is adjusting benefits at a rapid rate, processing 92% of new claims following the enactment of SSFA – 5 months ahead of schedule. Still, there are more adjustments to be made. The SSA alerted beneficiaries who received reduced benefits between January 2024 and June 2025 for any non-covered work that their next benefit adjustment would be refreshed by July 2025 and payments will be received in August 2025.
Still, not all public workers will receive a Social Security benefit increase as a result of the repeal. The SSA estimates that about 72% of state and local public employees work in Social Security-covered roles, which were not affected by WEP or GPO.
What Should You Do Now
In some cases – nothing. According to the SSA, if you are entitled to retired or disabled workers’ benefits or you are entitled to your spouse’s benefits and your payments are currently being reduced or eliminated by the WEP and GPO you do not need to file a claim. You do, however, need to ensure that the SSA has your correct mailing address and direct deposit information. If not, you can update this information through your online Social Security account or by phone at 800–772-1213.
If you are unsure whether you have ever applied for retirement, spousal or survivor benefits, you will need to submit a new application. Keep in mind that the date you apply can impact when your benefits begin, so it’s important to file as soon as your application is complete. The most convenient way to apply for these benefits is through www.ssa.gov/apply. Note, the survivor benefit is not currently available online. Beneficiaries must call 1-800-772-1213 Monday through Friday from 8AM to 7PM local time to submit their application.
If you’re in need of additional assistance related to potential benefits, visit the SSA’s FAQ page for more details.
Meet with Your Financial Advisor
Navigating the complexities of Social Security and pensions requires personalized guidance. Now is the time to ensure your financial plan is positioned for the greatest benefit.
A financial advisor can analyze how WEP or GPO has previously impacted your benefits, project new benefit amounts following the enactment, coordinate Social Security income within your border retirement strategy, and provide insights on possible tax implications, income planning, and legacy goals.
At Prudent Investors, we offer more than just money management. To meet the unique needs of retirees we offer Social Security modeling and holistic financial planning to help you meet your long-term retirement goals.
Your retirement income should reflect your lifetime of hard work and smart decisions. With the right guidance, you can move forward with clarity and confidence. Contact Prudent Investors to schedule a personalized consultation and learn how these important changes may enhance your financial future.
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