The latest announcement regarding the Cost of Living Adjustment (COLA) has illuminated the expected changes in Social Security benefits for 2024 to the American populace. This development has been keenly anticipated, especially given the economic climate of the past year. For the retirees in the United States, there’s a financial silver lining on the horizon.
In 2024, Social Security disbursements are slated to rise by an estimated $150. It’s crucial to note that this figure is the pinnacle of the increase and is reserved for those retirees who’ve maximized their retirement check amounts. To gauge the exact amount of the increase, retirees need to be aware of their current benefit amount. Once they have this, and with the annual COLA in hand, estimating the forthcoming year’s increase becomes straightforward.
2024 COLA Increase for Social Security Beneficiaries
However, this doesn’t mean every retiree will pocket an extra $150. The increment for the majority will be proportionate to their current benefits. For instance, if a retiree’s monthly benefit is $1,200, the increase will undoubtedly be less than $150. Recently, on October 12th, the Social Security Administration disclosed the COLA for the upcoming year. While the announcement may not have met everyone’s expectations, it’s believed to be a sufficient countermeasure against inflationary pressures.
The adjusted amounts will take effect from the first disbursement in January 2024. This denotes a brighter financial start to the year for beneficiaries. The determined increment is 3.2% in comparison to the benefits of 2023. To break it down further, retirees receiving the highest monthly check of $4,555 will soon find their amount boosted to approximately $4,700. This uplift of nearly $150 is a welcomed relief for those grappling with the rising costs due to inflation.
The uplifting news doesn’t end here. The COLA will be applicable across the board, ensuring every Social Security retiree benefits from this hike starting 2024.
Furthermore, individuals on Supplemental Security Income (SSI) aren’t left behind. They too will receive a 3.2% hike in their benefits, irrespective of their current benefit amounts.
Deciphering the 2024 Social Security Cost of Living Adjustment
The anticipated COLA for 2024 is set at 3.2%, a prediction that aligns with the Senior Citizens League’s forecast. This adjustment will be universally applied to all Social Security disbursements. While the 3.2% may seem modest, especially when juxtaposed with 2023’s whopping 8.7%, it’s pivotal to understand the context. Inflation rates have been more tempered this year, making the present COLA appropriate to address the cost of living.
However, a potential challenge lurks in the shadows. Should inflation surge dramatically before this year concludes, the announced COLA remains fixed. This means retirees will have to manage with the predetermined 3.2% increase for 2024.
Delving deeper into the numbers, the top-tier Social Security checks will leap from $4,555 monthly to roughly $4,700. While this near $150 raise may not seem monumental, its cumulative effect is considerable. Moreover, the beneficiaries of Supplemental Security Income will also witness an augmentation in their payments, with the ceiling expected to touch $943 monthly post the 2024 COLA implementation.
In 2024, retirees can expect several changes to their Social Security benefits:
- Cost-of-Living Adjustment (COLA): The Social Security Administration has announced a Cost-of-Living Adjustment (COLA) of 3.2% for 2024 fool.com, retire.ly, nbcnews.com, nytimes.com, bankrate.com, cnbc.com, apnews.com, ssa.gov. This means that the average Social Security benefit for retired workers will increase by $59 per month, from $1,848 to $1,907.
- Increase in Social Security Taxable Earnings: The maximum amount of earnings subject to the Social Security tax will increase from $160,200 in 2023 to $168,600 in 2024.
- Increase in Earnings Limits for Beneficiaries Under Full Retirement Age: The earnings limit for Social Security beneficiaries under full retirement age will increase in 2024.
- Increase in Medicare Part B premiums: Monthly Medicare Part B premiums will rise from $164.90 in 2023 to $174.70 in 2024.