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Social Security beneficiaries get the biggest raise in six years

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A 2% increase in benefits will be available for the more than 66 million Social Security and Supplemental Security Income recipients next year, the largest increase since 2012, though still small by historical standards.

The annual increase is determined by taking the average rate of inflation – determined by the Bureau of Labor Statistics’ broad measure of prices for food, housing, clothing, transportation, energy, medical care, recreation and education – from the third quarter of one year to the next. With low inflation throughout the economic recovery, adjustments have been slight or nonexistent. The 2% gain translates into an approximate $27-a-month increase for all retired workers, from $1,377 to $1,404.

Estimated Average Monthly Social Security Benefits Payable in January 2018

   Before 2% COLA  After 2% COLA
 All retired workers  $1,377  $1,404
 Aged couple, both receiving benefits  $2,294  $2,340
 Widowed mother and two children  $2,717  $2,771
 Aged widow(er) alone  $1,310  $1,336
 Disabled worker, spouse and one or more children  $2,011  $2,051
 All disabled workers   $1,173  $1,197

For those who are still working, the government also announced it will increase the maximum amount of earnings subject to the Social Security tax to $128,700 from $127,200, starting in January.

Source: Social Security Administration Fact Sheet – 2018 Social Security Changes, Oct. 13, 2017.

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Associated Tags: Retirement

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