Social Security recipients will start receiving larger payouts in December 2022. The 8.7% cost-of-living adjustment was what caused the Social Security benefit to increase.
In December 2022, Social Security claimants will begin to receive bigger payments. The rise in the Social Security payment was brought on by an increase in the cost of living adjustment of 8.7%.
Increased Social Security Payments
It will rise from $1,681 in 2022 to $1,822 in 2023. The rise fell short of the $200 that some retirees were hoping for though, as many elderly people find it difficult to keep up with inflation. The cost-of-living adjustment was higher in 1981 with an increase of 11.2% in COLA.
The amount of beneficiaries’ benefit checks may vary depending on Medicare Part B premiums and taxes. Payments to recipients of benefits for spouses, children, and survivors of deceased employees will increase by 8.7%.
Those who receive Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) benefits are also subject to the 8.7% COLA increase.
Beneficiaries most likely to have a significant rise in their benefit amount after the 2023 COLA is applied are retired employees. A retired worker’s spouse will earn $903.39 in 2023 as opposed to $831.54 in 2022 as their predicted benefit amount, which is $1,822.38.
Retired workers’ children will additionally earn $855.78. Disabled employees will earn $1,483.11 in SSDI payments, while their wives will receive $409.19 and their children will receive $469.25.
SSI beneficiaries under the age of 18 will receive $794.45, while those between the ages of 18 and 65 would receive $718.88. 65 and older SSI recipients will receive checks totaling $554.57.
There have been worries that payments may not be sufficient despite the rise in benefits.
Read more: Social Security changes to expect in 2023 that might affect your money in positive, negative way
Why COLA Increase Is Still Insufficient?
The National Council on Aging’s President and CEO, Ramsey Alwin, asserted that the COLA rise is insufficient for the millions of older Americans who are suffering the burden of the country’s rising housing and healthcare costs.
Alwin further noted that because many people of color and women have earned low earnings throughout their working lives, their rates of poverty are higher. They would receive lesser Social Security payments as a result of their low salaries.
COLAs are not used to boost benefits, according to Dan Adcock of the National Committee to Preserve Social Security and Medicare, who added that they are about people treading water.
Adcock pointed out that the purpose of COLA hikes is primarily to defend against inflation and help individuals retain their level of living.
Since 2000, claimants’ purchasing power has decreased by 30% as a result of COLAs growing at a rate that is only approximately half that of inflation.
By March, the disparity in purchasing power had grown to 40%. According to the Senior Citizens League, the prior COLA of 5.9% was 46% below actual inflation on average per month.
Read more: Social Security: Expect both good and bad changes in 2023!