Your Social Security check is growing. Find out why and by how much

You should expect to see more money on your next Social Security check.

Sarah Tew / CNET

Social Security recipients will see larger checks starting this month, the result of the biggest increase in benefits since the 1980s.

A further cost-of-living adjustment increased payments by 5.9%, or about $ 93 more per month – or $ 1,116 more per year – for seniors and other beneficiaries.

The adjustment will bring most checks to $ 1,658, according to the Social Security Administration, from $ 1,565 in 2021.

The rise, which is expected to affect around 70 million Americans, is due to the effect of soaring inflation on the prices of consumer goods, which have jumped 5.4% since September, according to the index of consumer prices from the US Bureau of Labor Statistics.

Also starting this month, the maximum amount of income subject to social security tax will drop from $ 142,800 to $ 147,000.

To find out more, here are the best tax deductions to look forward to in 2022 and what to expect from the housing market this year.

How much will my Social Security check increase?

Social Security and Supplementary Security Income, or SSI, recipients received letters in December detailing their new COLA benefit rate. If you missed your letter, you can check your specific increase online at My Social Security, or calculate it yourself by multiplying your 2021 monthly benefit by 1.059 and subtracting your Medicare Part B premium.

According to the Social Security Administration, retirees will receive an average of $ 93 more per month on average, while their spouses will see an increase of $ 47, raising their average monthly benefits from $ 794 to $ 841.

Workers with disabilities will get an average increase of $ 75, from $ 1,283 per month to $ 1,358, while widows and widowers with disabilities will see an average increase of $ 46 per month, from $ 772 to $ 818 .

When will I see the additional COLA money on my Social Security check?

COLA comes into effect with the December benefits, which are paid in January. 8 million initial ISS beneficiaries started receiving the increase on December 30, 2021, but the remaining beneficiaries will see the additional funds this month.

Social Security payments are made on Wednesdays, according to a deployment schedule depending on the beneficiary’s date of birth: If you were born from the 1st to the 10th of the month, your benefits are paid on the second Wednesday of the month and your first increase will appear on your January 12 check.

If your birthday falls between the 11th and 20th of the month, your checks are paid on the third Wednesday and you will see your first COLA increase on your January 19th check.

People born between the 21st and the end of the month receive benefits on the fourth Wednesday, which is January 26th this month.

How does the increase in social security benefits compare to inflation?

Although the 5.9% increase is the highest in 40 years, it still does not keep pace with inflation, which rose 6.8% between November 2020 and November 2021.

“We’re always going to see this huge problem with prices going up faster than COLA,” Mary Johnson, Social Security and Medicare policy analyst for the Senior Citizens League, told CBS News.

“So retirees, anyone living on a fixed income, should be aware that the 5.9% may sound like a bigger increase than we’ve ever had,” she added, “But once as they will have walked through their household budget, they will find it still will not pay all of the growing bills. ”

Johnson told CBS News that inflation is expected to continue to rise in 2022.

Also this year, the standard Medicare Part B cost climbs 14.5% to $ 170.10, according to the Centers for Medicare & Medicaid Services, which is an increase of $ 21.60 per month. And the annual deductible for Medicare Part B beneficiaries is now $ 233, an increase of $ 30 from 2021.

According to the CMS, the increases are due to rising prices and usage across the healthcare system, as well as the possibility that Medicare will have to cover expensive Alzheimer’s drugs like Aduhelm.

Will Social Security benefits increase as much in 2023?

Not necessarily. The cost of living adjustment is based on the increase in the consumer price index (CPI-W) from the third quarter of the previous year to the third quarter of the current year.

According to the Bureau of Labor Statistics, this year’s increase was “the result of large increases” in the cost of goods, especially gasoline, shelter, food, used cars and trucks, and vehicles. new.

If inflation goes down this year (a good thing), COLA will also go down.

In 2009, the COLA rose 5.8%, reports CNBC, but the annual adjustment over the next two years was nil.

To find out more, here are 6 money lessons 2021 taught us, 5 New Year’s financial resolutions you can keep, and some tax deductions to keep in mind.

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