With the arrival of October and Halloween season, the Social Security Administration is preparing another round of payments for millions of beneficiaries. These payments, which include retirement, disability, and Supplemental Security Income (SSI) benefits, play a crucial role for those who rely on them as a monthly source of income. This month, some beneficiaries might see payments exceeding $4,000.
As the year comes to a close, many beneficiaries are keeping a close eye on the news about the Cost-of-Living Adjustment COLA set to be applied in 2024. This adjustment, typically announced in October, determines the percentage by which current Social Security benefits will increase. The COLA is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) and reflects inflation in the cost of living.
Increase in Social Security payments for 2024: What to expect
This year, an increase of about 2.5% is expected, which will provide a modest boost to the monthly payments of many beneficiaries. The official figure will be announced on October 10, and this adjustment will affect millions of people who rely on these payments to meet their basic living expenses.
In addition to the annual cost-of-living adjustment, Congress has been discussing potential changes to Social Security laws. One of the most significant proposals is the Social Security Fairness Act, a bill aimed at eliminating reductions caused by the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). These two laws can currently reduce the benefits of certain recipients, especially those receiving pensions from jobs not covered by Social Security.
Legislative changes: Congress considering improvements to Social Security
If this bill passes, many beneficiaries could see their payments protected, offering relief to those whose benefits have been diminished due to these legal provisions. This issue has gained considerable attention in recent months, and it’s possible we will see progress on this front in the coming weeks as it moves closer to a vote.
The longer you wait, the bigger the payout
One of the most well-known strategies for maximizing Social Security payments is delaying the application for benefits. While the minimum age to begin receiving payments is 62, those who choose to wait can see significantly larger monthly payments. At age 62, a beneficiary might receive up to $2,710 per month. However, if they hold off until age 70, that figure can increase dramatically, reaching a maximum of $4,873 per month.
On the other hand, those receiving disability benefits may see payments up to $3,822 per month. Survivor benefits for individuals caring for two children can go as high as $3,953 per month. For beneficiaries under the SSI program, the average monthly payment is $698. This needs-based program is designed for individuals with limited resources or income, and it is often combined with disability or retirement benefits.
How are Social Security payments calculated?
The amount of Social Security payments a person receives is determined by several factors, including their work history, the age at which they choose to claim benefits, and, in some cases, their health or family situation. The longer a person works and the higher their lifetime earnings, the greater their monthly payment will be.
The Social Security Administration (SSA) is responsible for calculating and distributing these payments, ensuring they are delivered promptly to the millions of people who depend on them. Additionally, the annual cost-of-living adjustments help ensure that beneficiaries can maintain their purchasing power despite inflation.