Social Security Update: 5.9% Benefit Increase For 2022
Social security declares a 5.9% increase in SSI benefits for nearly 70 million Americans to be implemented in 2022.
The cost-of-living adjustment COlA will start being calculated from January 2022, and beneficiaries will begin receiving it in December 2022. Payments will be increased by 5.9%, with the increase for SSI being 4.2%.
Most people do not get an automatic cost of living increase, unlike pensions. The amount they are paid is based on a matrix of many factors, including their age, date of birth, etc.
But all these things are observed by comparing what the consumer price index has gone up against what it was in 1962 so that inflation can be calculated and adjustments can be made.
When you get an automatic increase, it is for the entire year. For example, in 2017, I got a 0.7% increase in my Social Security benefits because it was calculated using 2016 CPI numbers, so all of my benefits were increased by 1%. I did not get an extra $200 this year.
The cost of living adjustment will likely be lower than 5.9% because prices are usually lower in early 2018 than for the rest of the decade.
In other countries, the same thing is done. Sweden, for example, pensions are adjusted for inflation. In the US, the way it used to be was that pensioners would get a cost of living adjustment in their pension.
But now, Social Security recipients do not get a COLA in their benefits. But I remember somewhere that they used to adjust annual pension payments for inflation using a similar method.
Your state pays out SSI(Social Security and Supplemental Security Income) and social security benefits. The way it is calculated is probably along the same lines as pension COLAs, but I do not know for sure.
But I think most people with pensions do not increase every year because the money is not there to pay it. The way SSI and social security are funded is by FICA taxes taken from your paycheck.
Social Security Acts
The Social Security Act joins the yearly COLA to grow the Consumer Price Index defined by the Department of Labor’s Bureau of Labor Statistics.
Any other changes that need influence in January of every year depending on the rise in regular wages. Based on that progress, the maximum profits directed to the Social Security tax will grow to $147,000 from $142,800.
For Social Security receivers getting Medicare, Social Security will not count their brand-new bonus amount until after the Medicare bonus amounts for 2022 are declared.
The last 2022 bonus amounts will be transferred to beneficiaries by the mailed COLA report and my Social Security’s Message Center in December. You can get more info on the Social Security official page.
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