The News: According to the Social Security Administration, beneficiaries of Social Security can estimate an 8.7% increase in benefits in 2023. The increase surpasses the cost-of-living adjustment for 2022, which was 5.9% at the time and the largest in forty years.
Social Security Increase 2023
According to a Social Security Administration announcement, claimants’ payments would rise by 8.7 per cent in 2023. Around 65 million people who receive Social Security benefits and more than 7 million people who receive Supplemental Security Income will be subject to the cost-of-living adjustment (COLA). Due to the increase, the typical Social Security benefit check will increase by more than $140 each month.
The significant hike follows a 5.9% increase last year and is the most since 1981 when benefits climbed by a staggering 11.2 per cent in response to an extraordinarily high inflation period in the United States.
A rise in the minimum amount of wages due to Social Security taxes, or the taxable minimum, goes hand in hand with an increase in benefits. Workers will be required to contribute to Social Security on wages up to $160,200 in 2023, up from $147,000 in 2022. The modification will take effect in January. However, in the next year, the tax rate on such wages, which is 6.2%, won’t change.
The increase in payments is great news for retirees and individuals who rely on Social Security for a sizable amount of their income in the face of skyrocketing inflation in 2022. As the cost of necessities keeps rising, those who rely heavily on these benefits have been hard-hurt.
Even though seniors will benefit from the bigger monthly checks, the higher taxable minimum means that Americans with higher incomes may have to pay more in taxes to support the programme.
Social Security recipients can check their Social Security accounts for information or wait until December to learn their exact new benefit amount. With the most recent COLA, though, the average benefit check should increase nicely.
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