Connect with us

Personal Finance

They fought for Social Security Fairness Act. Now they wait for benefit increases

Published

on

President Joe Biden after he signed the Social Security Fairness Act at the White House on Jan. 5 in Washington, D.C. 

Kent Nishimura | Getty Images News | Getty Images

The biggest changes to Social Security in years were signed into law on Jan. 5.

For more than 3.2 million individuals, that will mean bigger benefit checks. And in some cases, the change will qualify them for Social Security benefits.

The new law, the Social Security Fairness Act, repeals two provisions that previously reduced Social Security benefits for individuals who receive pension income based on work where employers were not required to withhold Social Security payroll taxes.

They were the Windfall Elimination Provision, which was enacted in 1983, and the Government Pension Offset, which was signed into law in 1977. They were federal laws that reduced Social Security benefits for people who received pensions from noncovered employment. Both were repealed by the Social Security Fairness Act.

Among those affected include certain teachers, firefighters and police officers, federal employees, and workers covered by a foreign social security system.

Benefit increases may range from “very little” to more than $1,000 per month, according to the Social Security Administration.

Those increases apply to future monthly checks, as well as retroactive benefits payable since January 2024.

The Social Security Administration “expects that it could take more than one year to adjust benefits and pay all retroactive benefits,” the agency says on its website.

Nevertheless, advocates who fought for the change for years — some of whom will see their own benefits increase — say the signing of the bill was a victory, even as many beneficiaries face an indefinite wait for the extra money.

‘It’s going to take some time,’ a former teacher said of the changes

Roger Boudreau, a 75-year-old former English teacher and president of the Rhode Island American Federation of Teachers retirees chapter, had been to the White House before through his work in union activism over the past 50 years.

But witnessing the signing of the Social Security Fairness Act in January was the “highlight of my life,” he said.

When Boudreau dies, he hopes his role as a founding member of the National WEP/GPO Repeal Task Force is included in his obituary.

“It was such an incredibly important piece of legislation that affected so many people who’ve been so deeply wronged for so many years,” Boudreau said. (To be sure, many retirement policy experts oppose the new policy.)

Boudreau estimates he personally has been losing about $5,000 per year in retirement due to a penalty of about 40% on his earned benefits for the past decade.

More from Personal Finance:
‘Keep your hands off our Social Security,’ lawmakers warn amid DOGE budget cuts
Here are changes Americans would make to close Social Security’s funding gap
Why retirees may feel the 2025 Social Security COLA isn’t enough

Boudreau taught for 30 years on a variety of subjects including world and British literature and earned a pension toward retirement.

To supplement his income, he took on a variety of extra jobs where he paid into Social Security, working as a taxi driver, selling swimming pools and helping at bakeries over the holidays.

“When I started teaching in 1971, my salary was $7,000 [a year],” Boudreau said. “I had an infant child. If I had two, I would have been eligible for food stamps.”

In addition to the extra work while teaching, he also paid into Social Security when he worked in high school and college. If Boudreau had two more years of earnings, he would have been able to escape the penalty to his benefits, he said.

Now, he’s waiting on the Social Security Administration to find out how large his benefit increases will be.

“We understand that it’s going to take some time,” said Boudreau, who also serves as a task force liaison to the American Federation of Teachers.

In the meantime, the group is advising its retirees to make appointments with their local Social Security office to make sure their information is up to date.

Firefighter hoped benefits would help in retirement

Carl Jordan, a retired Canton, Ohio, fire captain, first found out his Social Security benefits would be reduced when he looked into retiring.

The reductions were a surprise to Jordan, who over a 33-year career started as a firefighter and worked his way up to serve as a medic and finally a captain.

While he earned a pension from that work, he also paid into Social Security through other work. He started as a phlebotomist working in blood donation and then trained as a apheresis technician to collect blood products for the treatment of cancer and other diseases.

“The whole reason for me working the second job was it contributed to the community and it also aided me in taking care of my family at the time,” Jordan said.

“Firefighter wages weren’t that great, and I had hoped that Social Security would supplement my retirement income when I got there,” he said.

Fiserv CEO on the nomination to Social Security Commisioner role

Today, Jordan, 73, estimates the reductions have cost him about 2½ years on his mortgage, or around $27,000 excluding interest.

The extra Social Security benefit money will help him pay off that mortgage a little sooner than expected, as well as pay for home improvements, he said.

Still, he doesn’t know exactly how much more benefits he will receive.

Jordan, who attended the January bill signing in Washington, D.C., spoke with a Social Security administrator there who said they could not provide more information on timing or the amount of benefit increases. A month later, he is still waiting for more information from the agency.

Nevertheless, Jordan said he was proud to witness a change he never expected to see in his lifetime, even after advocating for it for almost 16 years.

“To be there representing the profession that I had spent my life serving was an experience everyone should have,” Jordan said.

18-year-old lobbied on behalf of his grandmother

Eliseo Jimenez, who walked from Lubbock, Texas to Washington, DC, to discuss Social Security issues with government officials, leaves after being introduced by President Joe Biden during a signing ceremony for the Social Security Fairness Act at the White House. 

Chris Kleponis | Afp | Getty Images

At 18 years old, Eliseo Jimenez of Lubbock, Texas, may be the youngest to have lobbied for the Social Security Fairness Act.

His grandmother, a former teacher, had to rely mostly on her own pension as her source of income before the new law. Other family members who work in law enforcement were also affected by the provisions.

To call attention to the need for change, Jimenez last summer spent 40 days walking from Texas to Washington, D.C. Because he was under 18 at the time, he was not able to check into hotels or motels on his own, which forced him to sleep outside for several nights.

His efforts helped bring attention to the issue, he said.

“I had a lot of people email me and call me, supporting me and supporting the bill itself,” Jimenez said.

Last month, Jimenez returned to Washington, D.C., again, this time to witness the signing of the Social Security Fairness Act. At the event, then President Joe Biden led a chorus of other lawmakers and attendees to sing “Happy Birthday” to Jimenez. It was “pretty cool,” he said.

Since the changes became law, he has heard from his grandmother, neighbors and residents from other states like Virginia and Tennessee who are affected.

“They said it’s like amazing,” Jimenez said. “It’s life-changing.”

The win has inspired Jimenez, a high school senior who plans to attend college next year, to keep pushing for Social Security reform. He plans to complete another walk in Texas next month to call attention to the issue.

“I want to keep on being involved,” Jimenez said. “I want to keep on advocating for it.”

Don’t miss these insights from CNBC PRO

Continue Reading

Personal Finance

Summer Fridays are increasingly rare as hybrid schedules gain steam

Published

on

People enjoy an unusually warm day in New York City as temperatures reach the low 80s on June 4, 2025 in New York City.

Spencer Platt | Getty Images

Summer Fridays may be considered the most desirable perk of the season, but fewer employers are on board with the shortened workweek.

Companies have steadily phased out summer Fridays — a policy that allows workers to take Friday afternoon off over the summer months — as work-from-home Fridays became more common, experts say.

“Pre-pandemic, summer Fridays were thing, but hybrid overall has taken over,” said Bill Driscoll, technology workplace trends expert at staffing and consulting firm Robert Half.

As more commuters settle into flexible working arrangements, fewer workers are making Friday trips at all compared to mid-week traffic patterns, according to the 2024 Global Traffic Scorecard released in January by INRIX Inc., a traffic-data analysis firm.

More from Personal Finance:
Job market is ‘trash’ right now, career coach says
Millions would lose health insurance under GOP megabill
Average 401(k) balances drop 3% due to market volatility

Among employees, however, summer Fridays are the most valued summer benefit, followed by summer hours and flextime, according to a new survey by job site Monster, which polled more than 400 U.S. workers in June. 

“Summer Fridays are highly valued among workers because, for many, they represent more than just a few extra hours off,” said Scott Blumsack, Monster’s chief strategy and marketing officer. This perk “can go a long way in showing employees they’re valued, which can help prevent burnout, boost morale, and improve retention during a season when disengagement can run high.”

Still, 84% of workers are not offered any summer-specific benefits, even though 55% also said those benefits improve productivity, Monster found.

JPMorgan CEO Jamie Dimon blasts call for hybrid work, tells employees not to waste time on petition

Instead, hybrid — and to a lesser extent fully remote — job postings have increased in the last year as employers compete for talented job seekers who prioritize flexibility, according to research by Robert Half.

“Hybrid is a highly desirable situation right now and one that all levels of employees are looking for,” said Robert Half’s Driscoll.

More than five years after the pandemic, 72% of organizations also have return-to-office mandates, according to a separate hybrid work study by Cisco.

But, even with the mandates, employees are less likely to work in the office on Fridays, and much more likely to commute Monday to Thursday, Cisco found.

Employees value flexibility

As employee burnout and disengagement grows amid the wave of in-office mandates, work-life balance and flexible hours have become increasingly important, other studies show.

Corporate wellness company Exos, which works with large organizations such as JetBlue and Adobe, says burnout has gone down significantly among employees at firms that have made Fridays more flexible. Exos also tested out “You Do You Fridays” — and found significant benefits.

The more adaptable the schedule, the more positively employees view their company’s policies, the Cisco report also found.

With hybrid arrangements now common, workers put a high value on that flexibility — and 63% of all workers would even accept a pay cut for the option to work remotely more often, according to Cisco’s global survey of more than 21,500 employers and employees working full-time.

Subscribe to CNBC on YouTube.

Continue Reading

Personal Finance

How House Republicans’ ‘big beautiful’ bill may affect children

Published

on

Speaker of the House Mike Johnson, R-La., pictured at a press conference after the House narrowly passed a bill forwarding President Donald Trump’s agenda on May 22 in Washington, DC.

Kevin Dietsch | Getty Images

House reconciliation legislation, also known as the One, Big, Beautiful Bill, includes changes aimed at helping to boost family’s finances.

Those proposals — including $1,000 investment “Trump Accounts” for newborns and an enhanced maximum $2,500 child tax credit — would help support eligible parents.

Proposed tax cuts in the bill may also provide up to $13,300 more in take-home pay for the average family with two children, House Republicans estimate.

“What we’re trying to do is help hardworking Americans who are trying to provide for their families and make ends meet,” House Speaker Mike Johnson, R-La., said during a June 8 interview with ABC News’ “This Week.”

Yet the proposed changes, which emphasize work requirements, may reduce aid for children in low-income families when it comes to certain tax credits, health coverage and food assistance.

Households in the lowest decile of the income distribution would lose about $1,600 per year, or about 3.9% of their income, from 2026 through 2034, according to a June 12 letter from the Congressional Budget Office. That loss is mainly due to “reductions in in-kind transfers,” it notes — particularly Medicaid and the Supplemental Nutrition Assistance Program, or SNAP, formerly known as food stamps.

20 million children won’t get full $2,500 child tax credit

A member of MomsRising holds a sign on Capitol Hill to urge lawmakers to reject tax breaks for billionaires and protest cuts to Medicaid and child care on Capitol Hill on May 8 in Washington, D.C.

Brian Stukes | Getty Images Entertainment | Getty Images

House Republicans have proposed increasing the maximum child tax credit to $2,500 per child, up from $2,000, a change that would go into effect starting with tax year 2025 and expire after 2028.

The change would increase the number of low-income children who are locked out of the child tax credit because their parents’ income is too low, according to Adam Ruben, director of advocacy organization Economic Security Project Action. The tax credit is not refundable, meaning filers can’t claim it if they don’t have a tax obligation.

Today, there are 17 million children who either receive no credit or a partial credit because their family’s income is too low, Ruben said. Under the House Republicans’ plan, that would increase by 3 million children. Consequently, 20 million children would be left out of the full child tax credit because their families earn too little, he said.

“It is raising the credit for wealthier families while excluding those vulnerable families from the credit,” Ruben said. “And that’s not a pro-family policy.”

Expect the reconciliation bill to be done 'at some point this summer': Punchbowl's Jake Sherman

A single parent with two children would have to earn at least $40,000 per year to access the full child tax credit under the Republicans’ plan, he said. For families earning the minimum wage, it may be difficult to meet that threshold, according to Ruben.

In contrast, an enhanced child tax credit put in place under President Joe Biden made it fully refundable, which means very low-income families were eligible for the maximum benefit, according to Elaine Maag, senior fellow at the Urban-Brookings Tax Policy Center.

In 2021, the maximum child tax credit was $3,600 for children under six and $3,000 for children ages 6 to 17. That enhanced credit cut child poverty in half, Maag said. However, immediately following the expiration, child poverty increased, she said.

The current House proposal would also make about 4.5 million children who are citizens ineligible for the child tax credit because they have at least one undocumented parent who files taxes with an individual tax identification number, Ruben said. Those children are currently eligible for the child tax credit based on 2017 tax legislation but would be excluded based on the new proposal, he said.

New red tape for a low-income tax credit

House Republicans also want to change the earned income tax credit, or EITC, which targets low- to middle-income individuals and families, to require precertification to qualify.

When a similar requirement was tried about 20 years ago, it resulted in some eligible families not getting the benefit, Maag said. The new prospective administrative barrier may have the same result, she said.

More than 2 million children’s food assistance at risk

Momo Productions | Digitalvision | Getty Images

House Republican lawmakers’ plan includes almost $300 billion in proposed cuts to the Supplemental Nutrition Assistance Program, or SNAP, through 2034.

SNAP currently helps more than 42 million people in low-income families afford groceries, according to Katie Bergh, senior policy analyst at the Center on Budget and Policy Priorities. Children represent roughly 40% of SNAP participants, she said.

More than 7 million people may see their food assistance either substantially reduced or ended entirely due to the proposed cuts in the House reconciliation bill, estimates CBPP. Notably, that total includes more than 2 million children.

“We’re talking about the deepest cut to food assistance ever, potentially, if this bill becomes law,” Bergh said.

More from Personal Finance:
Experts weigh pros and cons of $1,000 Trump baby bonus
How Trump spending bill may curb low-income tax credit
Why millions would lose health insurance under House spending bill

Under the House proposal, work requirements would apply to households with children for the first time, Bergh said. Parents with children over the age of 6 would be subject to those rules, which limit people to receiving food assistance for just three months in a three-year period unless they work a minimum 20 hours per week.

Additionally, the House plan calls for states to fund 5% to 25% of SNAP food benefits — a departure from the 100% federal funding for those benefits for the first time in the program’s history, Bergh said.

States, which already pay to help administer SNAP, may face tough choices in the face of those higher costs. That may include cutting food assistance or other state benefits or even doing away with SNAP altogether, Bergh said.

While the bill does not directly propose cuts to school meal programs, it does put children’s eligibility for them at risk, according to Bergh. Children who are eligible for SNAP typically automatically qualify for free or reduced school meals. If a family loses SNAP benefits, their children may also miss out on those benefits, Bergh said.

Health coverage losses would adversely impact families

A protestor holds a sign on May 7, 2025 in Washington, D.C.

Leigh Vogel | Getty Images Entertainment | Getty Images

Families with children may face higher health care costs and reduced access to health care depending on how states react to federal spending cuts proposed by House Republicans, according to the Center on Budget and Policy Priorities.

The House Republican bill seeks to slash approximately $1 trillion in spending from Medicaid, the Children’s Health Insurance Program and Affordable Care Act marketplaces.

Medicaid work requirements may make low-income individuals vulnerable to losing health coverage if they are part of the expansion group and are unable to document they meet the requirements or qualify for an exemption, according to CBPP. Parents and pregnant women, who are on the list of exemptions, could be susceptible to losing coverage without proper documentation, according to the non-partisan research and policy institute.

Eligible children may face barriers to access Medicaid and CHIP coverage if the legislation blocks a rule that simplifies enrollment in those programs, according to CBPP.

In addition, an estimated 4.2 million individuals may be uninsured in 2034 if enhanced premium tax credits that help individuals and families afford health insurance are not extended, according to CBO estimates. Meanwhile, those who are covered by marketplace plans would have to pay higher premiums, according to CBPP. Without the premium tax credits, a family of four with $65,000 in income would pay $2,400 more per year for marketplace coverage.

Continue Reading

Personal Finance

‘White collar’ jobs are down — but don’t blame AI yet, economists say

Published

on

Artificial intelligence makes people more valuable, according to PwC’s 2025 Global AI Jobs Barometer report.

Pixdeluxe | E+ | Getty Images

While there hasn’t been much hiring for so-called “white collar” jobs, the contraction is not because of artificial intelligence, economists say. At least, not yet.

Professional and business services, the industry that represents white-collar roles and middle and upper-class, educated workers, hasn’t experienced much hiring activity over the past two years.

In May, job growth in professional and business services declined to -0.4%, slightly down from -0.2% in April, according to the Bureau of Labor Statistics. In other words, the sector has been losing job opportunities, according to Cory Stahle, an economist at job search site Indeed.

Meanwhile, industries like health care, construction and manufacturing have seen more job creation. In May, nearly half of the job growth came from health care, which added 62,000 jobs, the bureau found.

More from Personal Finance:
Here’s what’s happening with unemployed Americans — in five charts
The pros and cons of a $1,000 baby bonus in ‘Trump Accounts’
Social Security cost-of-living adjustment may be 2.5% in 2026

However, economists have said that the decline in white-collar job openings is more driven by structural issues in the economy rather than artificial intelligence technology taking people’s jobs. 

“We know for a fact that it’s not AI,” said Alí Bustamante, an economist and director at the Roosevelt Institute, a liberal think tank.

Indeed’s Stahle agreed: “This is more of an economic story and less of an AI disruption story, at least so far.”

Artificial intelligence is still in early stages

There are a few reasons AI is not behind the declining job creation in white-collar sectors, according to economists.

For one, the decline in job creation has been happening for years, Bustamante said. In that timeframe, AI technology “was pretty awful,” he said.

What’s more, the technology is even now still in early stages, to the point where the software cannot execute key skills without human intervention, said Stahle.

Amazon's big bet on 'physical AI'

A 2024 report by Indeed researchers found that of the more than 2,800 unique work skills identified, none are “very likely” to be replaced by generative artificial intelligence. GenAI creates content like text or images based on existing data.

Across five scenarios — “very unlikely,” “unlikely,” “possible,” “likely” and “very likely” — about 68.7% of skills were either “very unlikely” or “unlikely” to be replaced by GenAI technology, the site found. 

“We might get to a point where they do, but right now, that’s not necessarily looking like it’s a big factor,” Stahle said. 

‘Jobs are going to transform’

A separate report by the World Economic Forum in January forecasts that by 2030, the new technology will create 170 million new jobs, or 14% of the current total employment.

However, that growth could be offset by the decline in existing roles. The report cites that about 92 million jobs, or 8% of the current total employment, could be displaced by AI technology.

For knowledge-based workers whose skills may overlap with AI, consider investing in developing skills on how to use AI technology to stay ahead, Stahle said.

Continue Reading

Trending