When former President Joe Biden signed the Social Security Fairness Act into law on Jan. 5, 2025—just 15 days before he’d leave office—an estimated 3.2 million Americans stood to receive new Social Security payments.
Now, it appears those recipients will have to wait, as the Social Security Administration (SSA) says in an updated statement that they don’t have the necessary funds to pay out.
In a recent website update, the SSA said it lack the funds to pay eligible recipients “in a timely manner and without negatively affecting day-to-day customer service.”
The SSA cited a “new and unfounded workload” as the primary reason for the delay, which seems likely to extend to 2026. The agency said all customers will see “increased wait times” with their cases.
“Since the law’s effective date is retroactive, SSA must adjust people’s past and future benefits,” the SSA said. “Though SSA is helping some affected beneficiaries now, under SSA’s current budget, SSA expects that it could take more than one year to adjust benefits and pay all retroactive benefits.”
The statement also noted the new law didn’t provide any additional money to cover the extra payments. Under the Act, millions of new recipients would, on average, receive $360 monthly in new benefits, according to an estimate from the Congressional Budget Office.
An Understandable Delay
Social Security experts say the SSA may have a fair point to make, given the extra work and lack of additional funding.“Although the WEP [windfall elimination provision] and GPO [government pension offset] impacted around 3 percent of Social Security recipients, this is still around 3 million people,” Devin Carroll, a Certified Financial Planner and owner and lead advisor at Texas-based Carroll Advisory Group, told NTD. “This means that recalculations will have to be performed for all of them, with the addition of calculations for spousal and survivor benefits they may be entitled to receive.” With a workforce already at capacity and no additional funding to commit to this project, the agency “simply didn't have the bandwidth to deploy a large number of personnel to perform and double-check these calculations,” Carroll noted.
Carroll also noted the SSA final budget appropriation for FY 2024 was approximately $14.227 billion. “That’s almost $1.3 billion less than the SSA's initial request,” he added.
Other financial experts say the delay could hit recipients hard, budget-wise.
“Because of persistent underfunding and a staffing freeze with current staffing levels at 50-year lows, the SSA doesn’t have the resources to process payments on time,” said Yehuda Tropper, CEO of Beca Life Settlements in New Jersey. “This is sadly unsurprising. Many retirees don’t have enough savings. For example, a Morningstar report states that 45 percent of people who retire at 65 will run out of money. These delays will hit hard for millions across the country.”