October 12 is a big day for everyone who receives benefits from the Social Security Administration. On October 12, 2023, the Social Security Administration will announce changes to Social Security benefits, including the cost of living adjustment for Social Security benefits in 2024.
Social Security’s cost-of-living adjustment, or COLA, is based on changes in the Consumer Price Index that occur annually. Once the September 2023 Consumer Price Index is released, the SSA will be able to calculate how much they need to increase Social Security benefits. The 2024 COLA announcement will be made on October 12, 2023. The 2024 Social Security COLA is expected to be 3% to 3.5%.
The cost of living adjustment or COLA implemented by the Social Security Administration (SSA) is very important for everyone who receives SSA benefits. As you’ve probably noticed, the cost of things like rent, food, and utilities continues to rise.
And unless the amount of money people receiving Social Security benefits receive increases, they will not be able to afford the essentials they need to live. That’s why each year the SSA increases the amount of money people receive based on the amount of inflation that has occurred during the year and other financial factors.
Increasing the amount of benefits people receive can be life-changing for people who rely on Social Security disability benefits from the SSA. In 2023, SSA had the largest COLA in history at 8.7%.
To put this in real terms: for people receiving benefits, the amount of money they received increased by about $200 per person. An increase like that allows people who can’t work or who have retired to buy enough food, pay their bills and stay in their homes.
The COLA adjustment for 2023 was not typical. The huge increase was largely due to the unprecedented inflation rates that have occurred in recent years. In 2021 there was a 5.1% COLA increase in Social Security benefits. But before that, the average COLA increase for Social Security benefits was between 1% and 3%.
The Social Security Administration will announce the 2024 COLA on October 12, 2023. Experts predict this year’s COLA will be around 3%. If the 2024 Social Security cost-of-living adjustment is 3%, that means most people receiving Social Security benefits will see an increase of about $60 a month.
On October 12, 2023, at 8:30 am (ET), the Social Security Administration will release the COLA for 2024. There are a couple of different factors that will affect what the 2024 COLA is and the increase in benefits it people will receive. they really get if they receive Social Security benefits.
The first factor that influences COLA is inflation. The amount of the COLA is based on the amount of inflation measured by the Consumer Price Index (CPI). The CPI data for September 2023 will have a direct impact on the amount of the increase in Social Security benefits. Since inflation has slowed, experts predict that the COLA for 2024 will be less than half of the COLA for 2023.
Another factor that will influence how much money people actually see in their monthly check is the cost of Medicare Part B. People who have Medicare and also receive Social Security benefits have the cost of their Medicare Part B premiums deducted directly from their benefits. If the cost of Medicare B premiums increases, people will see less money in their Social Security benefit checks even after the COLA.
Many people who receive Social Security benefits are eagerly awaiting the Social Security Administration’s COLA announcement on October 12 because it means they will be able to better budget for the future knowing that they will start receiving more money in 2024.
Experts predict that the Social Security COLA for 2024 will be between 3% and 3.5%. It may seem like a small number compared to last year, when the COLA was a whopping 8.7%. But it’s important to note that the record 8.7% COLA in 2023 was in response to record inflation that made it very difficult for people who rely on Social Security benefits to buy basic necessities like food and pay rents that also increased. in record quantities.
A cost-of-living adjustment of 3% to 3.5% is slightly above the average COLA over the past 20 years, and now that inflation is slowing, it should be enough to help many people continue to live comfortably.
If Social Security in 2024 is around 3% as experts predict, that would mean about $60 more in benefits per month for most people. While that’s not as much as the 2023 Social Security COLA increase, any additional money can help people living on Social Security benefits.
Fortunately, the inflation that caused rapid and huge price increases in food, rent, and the cost of goods people need to survive has slowed. This has made it a little more affordable to buy essentials and pay bills. However, as healthcare costs continue to rise, people whose primary income is Social Security benefits can definitely use the 2024 COLA increase to pay their bills and get what they need each month.
People who receive Social Security benefits and receive Medicare Part B should pay close attention to how much the cost of their Medicare Part B premium will increase in 2024. It could be that the increased premium cost offsets any additional money they would have received from the COLA.
The COLA is not the only announcement the Social Security Administration will make on October 12, 2023. In fact, There are two other announcements that will have an effect on people who are receiving Social Security benefits.
The first additional announcement is how much the amount exempt from the retirement income test will increase. The amount exempt from the retirement income test is something people who are still working but also receiving Social Security retirement benefits should know.
People who receive their retirement benefits but have not reached full retirement age can earn up to a certain amount of money without it affecting their benefit amount. If they earn more than the amount exempt from the retirement income test, the benefit amount they will receive will be less. Retirement benefits prove that the exempt amount changes annually based on the national average wage index.
The second additional announcement is the announcement of the increase in the maximum taxable profit limit. The taxable income cap affects the amount of money employees can receive from their employer that goes toward funding Social Security benefits.
Social Security benefits of all types are funded by a specific payroll tax. When employees are paid, 6.2% of their gross salary goes to fund the old-age, survivors, and disability insurance trust funds. Employers match the funds employees contribute, so the total amount contributed is 12.4%.
In 2023, the maximum taxable income limit for employees was $160,200. If an employee earned more than that, the 6.2% deduction was not applied to that income. The maximum taxable gain should increase in 2024 and the SSA will announce the new amount on October 12, 2023.
October 12 is important because it is the day the SSA announces its official COLA for next year. This occurs on October 12 because it is the date on which the Consumer Price Index data for September is published. The CPI is what the COLA and other updates from the Social Security Administration are based on. So as soon as they get the September numbers, the SSA will be able to release their own increases that will go into effect on January 1, 2024.
It’s an important date for those receiving Social Security benefits because once they know how much their COLA will be, they can start budgeting for next year. People who receive Social Security benefits often need to wait to do things like look for a new apartment or house until they know what their benefit amount will be next year.
With rent prices rising, many people need to know if they will be able to stay where they are in the new year or if they will have to start looking for a new apartment. People also need to know what their benefit amount will be so they can plan large purchases or set a billing budget for their utilities.
If you receive Social Security benefits and are wondering, “How much will I receive from Social Security in 2024?” Be sure to look for the Social Security Administration’s 2024 COLA announcement on October 12, 2023 after 8:30 am (ET). By then, the SSA will have announced the 2024 COLA, as well as the amount exempt from the retirement income test and the maximum taxable income limit for 2024. Experts say the COLA will likely be between 3% and 3%, 5%. You can use this Disability calculator to calculate how much more money you will receive if the COLA is around 3%.
Everyone who receives Social Security benefits should stay informed about changes to benefits paid by the SSA to maximize their benefits and use them wisely. If you are applying for Social Security disability benefits now, or would like to receive expert advice on Social Security benefits, complete a Free Case Evaluation now to be connected with an attorney who subscribes to this site and can offer you personalized advice today. At no cost to you.
