SOCIAL SECURITY, social security changes in 2023
Social security is extremely important in the lives of those in need; the government pays money on a regular basis to certain groups of people.These people may be unemployed, sick, or have no other source of income and rely on social security.
These people need to focus on the changes happening in social security this year. The social security administration and recipients will be getting a huge hike on the COLA cost of living adjustment, which is 8.7%, and this is the highest increment since 1981. The changes aren’t limited to just this; taxes on benefits, the disability threshold, and security payroll taxes will also change this year.
Now let’s talk in detail about the changes happening in social security
8.7% COLA (cost of living adjustment) will be hitting the accounts of around 70 million recipients of social security starting this month. After almost a decade, Medicare payments will be going down. The increase is approximately 8.3%, and medical costs have increased by 5.4%; in fact, the average hospital stay is 13,600 dollars, and the most recent estimate is that people over the age of 65 will pay 315,000 dollars for medical care during their retirement years.
According to Kilolo Kijakazi, “Security benefits are rising and Medicare payments are going down this year, 2023, and this is going to be of great help for the Americans; basically, for the seniors, it would be relaxing.” The changes that are happening would provide more support and relief for the Americans who are actually in need and who don’t have much savings.
Maximum Amount of Increment on Monthly Benefits:
- The retired Americans until the age of their full retirement will be experiencing an increase of 282 dollars, i.e., from 3345 to 3627 dollars. For this benefit, they need to meet the eligibility criteria, which is that the worker needs to have been employed for at least 35 years of their age and must have the maximum taxable income each year, which is 160,200 dollars this year, increased by 45,000 dollars 35 years ago, in 1988.
Rise in lifetime earning:
- In order to qualify for social security benefits, you must have a collection of 40 lifetime earning credits, and with each credit, you must earn at least the minimum amount from your occupation.To be eligible for all four credits in 2023, you must earn at least $6,560.
Early birds who claim before their retirement age will face higher income limits:
- If a recipient claims for income benefits before the deadline or before reaching retirement age, their payments will be reduced under the retirement earnings test. Before completing your retirement age in 2022, you don’t have to file for benefits, or else the Social Security Administration will withhold 1 dollar for every 2 dollars you’ve earned above 19,560 dollars, which is 1,630 dollars per month. Also, the test limit has been raised from 21,240 to 17,70 dollars per month this year.
Inflation on the Earnings Limit for Disability Benefits:
- The Social Security Administration doesn’t limit the benefits just to retirees but also to disabled employees who actually have low income. This year the limit for disabled got a hike from 2,260 to 2,460 dollars, but on the other hand, the non-blind employees will not get their benefits if they cross the monthly earning limit, i.e., up to 1,470 dollars, which was earlier 1,350 dollars. All disabled employees do need to meet certain eligibility criteria to access the social security changes happening.
Raised monthly benefits, savings and earnings upto retirement:
- Recipients will see a significant increase in COLA and Medicare payments almost a decade from now.
If a worker is claiming social security benefits and will be reaching retirement age this year, the benefits that’ll be served will be 1 dollar for every 3 dollars of earned income, but this will work only if a few months are left before retirement. The limit got hiked by 4,560 dollars this year. Where the limit was 51,960 dollars last year, it will be 56,520 dollars this year.There is alot to consider while retiring.
Looking at the various inflations in social security, employees should start planning accordingly to receive the most benefit. Employees should begin checking their job status as soon as possible, as this is critical if they expect the social security administration to serve them well. It is high time that the Americans who are the recipients of social security should work well on becoming qualified to access the benefits and have a good future ahead.
KEY POINTS
The social security administration provides huge relief and peace to the retirees with the changes happening to social security this year.
Highest increment of 8.7% on cost of living adjustment (COLA) since 1981.
Security benefits are rising and Medicare payments are going down this year, 2023.
The changes aren’t limited to just COLA; taxes on benefits, the disability threshold, and security payroll taxes will also change this year.
In order to qualify for social security benefits, you must have a collection of 40 lifetime earning credits.
Read this too
A BIG UPDATE ON THE STUDENT LOAN PROGRAM AND WHAT YOU SHOULD KEEP IN MIND DURING THIS TIME