The Social Security Administration has announced a 3.2% cost-of-living adjustment (COLA) rise for 2024 that will boost benefits for over 71 million Americans.
The increase is in line with stubbornly high inflation, as the latest Consumer Price Index figure held at 3.7% in September.
Furthermore, the reported figure has exceeded expectations and has remained consistent for a month. In fact, the inflation rate in the country was 3.7% in the previous month, up from 3.2% in the month before.
Also read: US Inflation Remains at 3.7%
Social security benefits to begin in January
The COLA benefits rise will start in January 2024 for over 66 million Social Security beneficiaries. Higher payments to around 7.5 million SSI recipients begin on December 29, 2023.
The change comes as rising prices continue squeezing household budgets for essentials like food, housing, and healthcare. The automatic COLA aims to help beneficiaries keep pace with inflation.
The 3.2% bump will increase the average monthly retirement social security benefit by a $59-month extra. Additionally, the earnings limit for individuals who have not yet reached “full” retirement age will be raised to $22,320. For those reaching their “full” retirement age in 2024, the earnings limit will be increased to $59,520. The maximum taxable earnings cap will rise to $168,600 in 2024.
Earnings limits for recipients collecting benefits before full retirement age will also increase significantly in the new year.
The increase will provide critical support, and taxpayers should understand the adjusted figures that accompany the change.