Big Raise For Social Security Income
The Social Security Administration has announced its biggest cost-of-living adjustment (COLA) increase in the past 42 years. In 1981, we had the largest Social Security COLA on record at 11.2%. In 2023, those receiving Social Security will see an 8.7% COLA increase. This tops last year’s 5.9% COLA increase.1
What this increase means for those collecting Social Security benefits is additional help battling inflation. The average Social Security retiree benefit will increase $146 per month, to $1,827 in 2023, from $1,681 in 2022.1 The increase would also raise the maximum retirement benefit to $3,627 for someone who retires in 2023.
Keep in mind that it is not necessary to claim Social Security benefits to cash in on this huge increase. Anyone who is 62 or older and eligible to start Social Security in 2023 will benefit from the COLA adjustment. The 2023 cost of living adjustment, along with every other COLA awarded from the time you turned 62 until you file for benefits, will be automatically included in your Social Security.
Why is this increase happening now? Congress has COLA increases tied to rising inflation. While there’s been a great deal of talk about inflation this year, the increase depends on the much-anticipated official numbers: the third quarter’s Consumer Price Index (CPI) is measured against the CPI of the previous year, and the COLA is calculated from that.
If you are curious to know what your specific Social Security benefit looks like, create an account at SSA.gov and these increases should be reflected in the months to come. If you have other Social Security questions, our team is here to help.
1. CNBC.com, October 13, 2022
Information in this material is for general information only and not intended as investment, tax or legal advice. Please consult the appropriate professionals for specific information regarding your individual situation prior to making any financial decision.
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