Each year, Social Security regular cost-of-living modification (COLA) acts as a buffer for beneficiaries against the influx of rising costs. This protection encompasses all beneficiaries from the elderly and survivors to those receiving disability benefits. COLA monitors consumer price fluctuations annually, adjusting benefit rates accordingly. Metrics that evaluate national wage progression trends can also influence the eligibility and benefit rates for SSDI and SSI recipients.
Thus, those obtaining benefits from Social Security Disability Insurance (SSDI) or the Supplemental Security Income (SSI) programs that offer financial assistance to individuals hindered from employment due to severe health conditions can expect a 3.2 percent uplift in their monthly entitlements in 2024. Here’s a glance at the adjustments these beneficiaries might witness in 2024.+
Understanding the 2024 COLA Impact on SSDI Beneficiaries
As of September, over 7.4 million employees accessed SSDI, making up approximately 11% of all those benefiting from Social Security. SSDI, like pension perks, is sourced from payroll tax contributions channeled into the Social Security trust funds. A recipient’s work history plays a pivotal role in determining both eligibility and the magnitude of the benefit.
Data from the Social Security Administration (SSA) indicates that the 2024 COLA will bump the average monthly SSDI entitlement for an incapacitated worker by $48, raising it from $1,489 to $1,537, effective from January.
About 1.2 million dependents also tap into SSDI based on the earning record of a disabled kin, be it a spouse, ex-spouse, or parent. The collective monthly benefit for an incapacitated worker with dependents drawing from their record will witness a hike from $2,636 to $2,720 come January.
Key Changes in Supplemental Security Income (SSI) for 2024
Disability benefits come with a stipulation: recipients must be predominantly incapable of employment. Hence, the Social Security imposes an earnings threshold for SSDI beneficiaries. Crossing this “substantial gainful activity” (SGA) threshold usually leads to a forfeiture of SSDI benefits.
Adjusted yearly, the SGA threshold in 2024 permits most SSDI beneficiaries to secure up to $1,550 monthly through employment without jeopardizing their entitlements, a rise from 2023’s $1,470. A higher limit applies to blind recipients, set at $2,590 monthly in 2024, a $130 enhancement from the previous year.
Several initiatives by Social Security aim to aid those with disabilities in exploring re-employment. One such scheme is a trial work period, wherein SSDI recipients can earn unlimited income for any nine months within a span of five years without benefit cuts. For 2023, a month is counted toward this trial phase if earnings hit $1,050 or more; in 2024, this limit increases to $1,110.
Supplemental Security Income (SSI) differs fundamentally from standard Social Security benefits. Funded primarily by general taxation rather than Social Security payroll contributions, the SSA oversees this lifeline program. It provides regular financial assistance to over 7.4 million individuals aged 65 and above or those who are either blind or disabled with minimal income and assets.
In 2024, the maximum federal allotment for an individual SSI recipient will climb from $914 to $943 monthly. Most states chip in additional payments for select SSI beneficiaries. An SSI-eligible married pair can anticipate up to $1,415 monthly, a rise from this year’s $1,371.
While SSI benefits are usually disbursed on each month’s inaugural day, the first payment post-COLA adjustment, owing to January 1st being a public holiday, will be on the preceding workday in this instance, December 29th.
Applicants for SSI must adhere to the SGA earning limitations when filing. Surpassing the earning cap during the claim can lead to a rejection. However, once an individual begins receiving SSI, the SGA restrictions no longer apply.
Still, there’s another earning limit for those on SSI. Any additional income, be it from employment, other benefits, investments, or familial support, might reduce their monthly SSI payout. If this “counted income” surpasses the federal payment standards of $943 for singles or $1,415 for couples in 2024, they won’t receive any SSI benefits for that month.
Another notable impact of COLA is on younger SSI beneficiaries, specifically those with disabilities or blindness. Students enrolled in secondary schools, colleges, or vocational training can earn up to a specified monthly limit without it affecting their SSI benefits. In 2024, this “student earned income disregard” is set at $2,290, up from 2023’s $2,220, with an annual cap increased to $9,230 from $8,950.
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