Jhe Cost of Living Adjustment for (COLA) 2023 will have some major changes you need to be aware of for next year. Social Security The administration-run programs are making significant changes and recipients will want to watch for them starting next year. According to the federal agency, about 70 million Americans depend on Social Security and Supplemental Security Income benefits. There are five major changes they need to watch out for in 2023.
1.- An 8.7% boost for retirees
This has to be the biggest change of all, because the COLA rate still adjusts each year based on Consumer Price Index data for urban wage earners and office workers. It measures changes in the cost of popular goods and services. An 8.7% increase means checks will go from $4,194 to around $4,559 and $1,801 per month. This means applicants will have the chance to get an extra $365 per month on coverage.
2.- Increase in disability
This increase will certainly also apply to all disability beneficiaries. in 2022, the maximum SSI amount was $841, which goes up to $914. Additionally, the average Social Security Disability Insurance (SSDI) increases from $1,364 to $1,483 per month.
3.- Increased monthly SSDI revenue limit
Even though you can technically qualify for both programs, there is one major difference between the two. One of these differences is income from qualifications. This year, the monthly income limit was $1,350 for most people who claimed it, but it increases to $2,260 if the beneficiary is blind. The increase for 2023 will increase to $1,470 and $2,460, respectively.
4.- The earnings limit will increase for social security
If people work while collecting Social Security benefits, these may be reduced depending on your income. If you earned more than $19,560 in 2022, SSA will withhold $1 for every $2 you earn over that limit until you reach full retirement age. However, this limit will increase to $21,240 next year.
5.- Maximum earnings for tax limit increases
Finally, keep in mind that the Social Security maximum salary will increase in 2023 from $147,000 to $160,200. Individuals who earn a maximum or more in 2023 will pay $9,932.40 to the SSA. For most people, taxes to Social Security are 6.2% but this amount rises to 12.4% if you are self-employed.