Millions of Social Security recipients will have a 3.2% increase in payments in 2024, which is far less than the historic increase this year and reflects softening consumer prices.
The typical beneficiary will start receiving more than $50 more each month starting in January as a result of the cost-of-living adjustment, or COLA, the Social Security Administration announced on Thursday.
The AARP calculated the increase to be $59 a month. Kilolo Kijakazi, the acting commissioner of Social Security, said, “This will help millions of people keep up with expenses.”
Social Security benefits are received by about 71 million people, including retired people, people with disabilities, and children. Following this year’s 8.7% benefit rise, which was prompted by record-breaking, 40-year-high inflation that increased the cost of consumer items, on Thursday’s announcement
The following year’s gain is noticeably lower due to the slowing of inflation. Senior advocates praised the annual adjustment nonetheless.
Retirement-age workers will soon receive larger Social Security payouts, which will help them keep up with rising costs, according to AARP CEO Jo Ann Jenkins. We are aware that elderly Americans still experience pain while paying for gasoline and groceries, making every dollar count.
Payroll taxes from employees and their employers are used to fund Social Security. From $160,200 in 2023 to $168,600 in 2024, the maximum amount of earnings subject to Social Security payroll taxes will increase.
The COLA, according to Nancy Altman, head of Social Security Works, a nonprofit that promotes the social insurance program, is a “reminder of Social Security’s unique importance” and “Congress should pass legislation to protect and expand benefits.”
But in the upcoming years, the program will be severely short on funding. The program’s trust fund will no longer be able to pay full benefits starting in 2033, according to the annual Social Security and Medicare trustees report, which was published in March.
The government will only be able to pay 77% of the bill if the trust fund runs out.