The eagerly awaited moment has arrived for all Social Security and disability beneficiaries – the announcement 2024 Social Security COLA. Last year’s Cost of Living Adjustment (COLA) of 8.7% was unusually high due to rising inflation.
There has been speculation about how much this year’s adjustment would be.
In this article, we will delve into the details of the 2024 COLA announcement and its implications.
Lastly, we will provide updates from the Social Security Administration regarding overpayments and the payment schedule for October 2023.
Prefer Video? – See 2024 COLA and Average Benefit Amount for 2024
Watch the video below for details about the 2024 COLA announcement and what it means for your benefits.
The 2024 COLA Announcement
The Social Security Administration has officially revealed that the COLA for 2024 will be 3.2%.
This figure aligns with earlier predictions, particularly the estimate of 3.2% made by the Senior Citizens League, a nonpartisan organization known for its accurate COLA forecasts.
This adjustment means that the average Social Security retirement benefit will increase by approximately $50 per month.
Essentially, the average benefit will increase from $1,848 to $1,997.
While any increase is welcome, it’s important to note that this 3.2% rise is significantly lower than the 8.7% COLA awarded in the previous year.
To understand the significance of this 3.2% COLA, let’s examine historical data.
Over the last two decades, COLAs have averaged at 2.6%, making the 3.2% increase slightly above average.
However, considering the recent surge in inflation, some argue that this adjustment may not be sufficient.
Notable COLA percentages from the past include a staggering 14.3% in 1980, 8.7% in the previous year, and 5.9% in 2022, primarily driven by recent inflation trends.
In contrast, before the recent inflationary period, COLAs were much lower, with some years seeing no increase at all.
Impact on Medicare Premiums
It’s essential to understand that COLA adjustments also affect Medicare Part B premiums.
The New York Times predicts an increase from $164.90 to $174.88, potentially impacting Medicare beneficiaries significantly.
Notification and Information
Beneficiaries can expect to receive official notification of their COLA adjustments from the Social Security Administration by mail in early December.
However, for those who want to access this information earlier online.
Starting November 14th, you can log in to your Social Security My Account online to view your COLA adjustment for January 2024.
Medicare beneficiaries will also find information about Part B premiums in the same notice, or they can visit medicare.gov for details.
How COLA Is Calculated
COLA calculations are based on changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
The CPI-W during the third quarter of the previous year is compared to the third quarter of the current year.
If prices have increased, Social Security and disability benefits are adjusted accordingly.
It’s important to note that benefits can never decrease due to COLA adjustments; they can only stay the same or increase.
Ways COLA May Affect You in 2024
- Payroll Taxable Amount Increase: The maximum amount of your pay subject to Social Security payroll taxes will rise from $16,200 in 2023 to $16,800 in 2024.
- Maximum Benefit at Retirement Age: The maximum benefit at full retirement age is projected to increase from $3,627 to $3,758 in 2024.
- Income Thresholds for Working Beneficiaries: If you are claiming Social Security while still working, your income thresholds before Social Security taxes are withheld may change. The specific thresholds are subject to official updates.
Review of Overpayment Practices
The Social Security Administration is under scrutiny for its overpayment practices, especially affecting Social Security Disability Insurance (SSDI) beneficiaries.
Many individuals have received letters demanding repayment of thousands of dollars in overpayments, causing financial distress.
The Acting Commissioner of the Social Security Administration has stated that they are reviewing these practices, though it’s unclear if this will result in a complete overhaul or just modifications to the collection process.
Social Security Payment Schedule for October 2023
Social Security benefits are typically paid based on your birthday:
- Birthdays from the 1st to the 10th: Payments are made on the second Wednesday of the month.
- Birthdays from the 11th to the 20th: Payments are made on the third Wednesday of the month.
- Birthdays from the 21st to the 31st: Payments are made on the fourth Wednesday of the month.
- SSI beneficiaries may receive payments on the first or third of the month unless these dates fall on a weekend or holiday.
What to Do If You Don’t Receive Your Benefits
If you do not receive your Social Security benefits, wait for three additional business days.
If the issue persists, contact Social Security at 1-800-772-1213 or check your online account for information.
Non-receipt of benefits could be due to various reasons, including overpayments, reductions, or other administrative issues.
2024 Social Security COLA – Summary
The 3.2% COLA adjustment for 2024 may not be as substantial as beneficiaries hoped for, given the recent inflation trends.
Also, it’s essential to stay informed about how this adjustment affects you personally and to be vigilant if you encounter issues with benefit payments or overpayments.
As the Social Security Administration reviews its practices, changes may be on the horizon to alleviate the burden on beneficiaries facing overpayment demands.
If you have any questions about an SSI Overpayment Letter, please ask us in the comments section below.
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