The Social Security Administration has announced its cost-of-living adjustment (COLA) for 2022. Each year, federal benefit rates increase when the cost of living rises, as measured by the Department of Labor’s Consumer Price Index (CPI-W).
The CPI-W rises when inflation increases, making your cost of living go up. This means prices for goods and services, on average, are a little more expensive, so the COLA helps to offset these costs.
The Administration has announced that Social Security and Supplemental Security Income (SSI) benefits for approximately 70 million Americans will increase 5.9 percent in 2022. This is the largest increase since 1982 (in 2009, benefits were increased by 5.8 percent).
The estimated average monthly benefits payable to all disabled workers will rise to $1,358. The maximum SSI monthly benefit will rise to $841 for an individual, or $1,261 for a couple.
The 5.9 percent COLA will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022. Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021.
January 2022 marks other changes based on the increase in the national average wage index. For example, the maximum amount of earnings subject to Social Security payroll tax, as well as the retirement earnings test exempt amount, will change in 2022. The monthly substantial gainful activity (SGA) amount will be $1,350 for a non-blind individual and $2,260 for a blind individual. The monthly earnings threshold for a trial work period (for those already receiving benefits) will change to $970.
Read more about the 2022 COLA here.
By: Joyce Trudeau of Premier Disability Services, LLC®