The Social Security Administration (SSA) announced that the social security payments will increase by a whopping 5.9%; the biggest cost-of-living adjustment in 40 years (since Ronald Regan’s first term in office).
For comparison, in 2021, social security recipients received a mere 1.3% increase.
What’s more, in the following year, the average monthly benefit for retired workers will go up by $92 — namely, from $1,565 to $1,657. Likewise, the average payment will increase by an estimated $154 ($2,753 per month) for married couples.
Other social security changes for 2022 include:
- A $197 rise in the maximum possible social security benefit for people who retire at a full age — from $3,148 to $3,345.
- A higher social security tax cap; earnings subject to social security tax will go up by $4,200, reaching $147,000 in total. Moreover, earnings above the mentioned amount won’t be used to calculate future social security payments.
- Before reaching full retirement age, social security beneficiaries will also be able to earn up to $19,560, after which $1 will be withheld for every $2 earned above the threshold.
- People can begin claiming retirement benefits at the age of 62. However, if you decide to do so before reaching the full retirement age, the payout will be permanently reduced by 30%. Conversely, those that choose to claim their benefits at the ripe old age of 70 will receive an annual payout 32% higher than their full retirement benefits.
The changes in the social security program will take effect on January 1, 2022.
