If you or a loved one is on Social Security, you know that a payment increase is required to help keep up with the rising cost of living in Texas. Thankfully, here is some good news for you. Tens of millions of older Americans are going to be bringing in larger checks from Social Security starting in January of 2023.
The U.S. government announced recently that Social Security beneficiaries will see an 8.7% increase in monthly payments this upcoming year, the largest increase in four decades. That means starting in the new year, checks will be $140 per month higher. (source)
In addition to increases in 2023, some recipients will be seeing a boost in the first round of checks from the Social Security Administration will be worth as much as $4,194, will be sent in the next few weeks, according to the Social Security Administration.
How do these Social Security adjustments work?
Each year the Social Security Administration has a cost-of-living adjustment called COLA. The purpose of the COLA is to ensure that the purchasing power of Social Security and Supplemental Security Income (SSI) benefits are not eroded by inflation. (source)
So, is your current amount 8.7% higher than the 2022 amount for Social Security?
No quite. You can't just take your current payment and increase it by 8.7%. The truth is that some payment increases will be higher than 8.7%, and some will be lower. The reason is that the COLA is applied to your primary insurance amount (PIA) rather than your current benefit — and the two are not always the same. You'll want to use this official Social Security benefits calculator here from the Social Security Administration.
What do you think of this news regarding Social Security?
Is this COLA amount actually high enough to cover the price increases for goods and services?
Please feel free to share your thoughts in the comments.
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