- Social Security beneficiaries can expect an 8.7% boost to benefits in 2023, the Social Security Administration announced on Thursday.
- The increase tops the 5.9% cost-of-living adjustment for 2022, which at the time was the highest in four decades.
Amid record high inflation, Social Security beneficiaries will get an 8.7% increase to their benefits in 2023, the highest increase in 40 years.
The Social Security Administration announced the change on Thursday. It will result in a benefit increase of more than $140 more per month on average starting in January.
The Senior Citizens League, a nonpartisan senior group, had estimated last month that the COLA could be 8.7% next year.
The confirmed 8.7% bump to benefits tops the 5.9% increase beneficiaries saw in 2022, which at the time was the highest in four decades.
The last time the cost-of-living adjustment was higher was in 1981, when the increase was 11.2%.
Next year’s record increase comes as beneficiaries have struggled with increasing prices this year.
“The COLAs really are about people treading water; they’re not increases in benefits,” said Dan Adcock, director of government relations and policy at the National Committee to Preserve Social Security and Medicare.
“They’re more trying to provide inflation protection so that people can maintain their standard of living,” Adcock said.
How much your Social Security check may be
Beneficiaries can expect to see the 2023 COLA in their benefit checks starting in January.
But starting in December, you may be able to see notices online from the Social Security Administration that state just how much your checks will be next year.
Two factors — Medicare Part B premiums and taxes — may influence the size of your benefit checks.
The COLAs really are about people treading water; they’re not increases in benefits.Dan Adcockdirector of government relations and policy at the National Committee to Preserve Social Security and Medicare
The standard Medicare Part B premium will be $5.20 lower next year — to $164.90, down from $170.10. Those payments are often deducted directly from Social Security benefit checks.
“That will mean that beneficiaries will be able to keep pretty much all or most of their COLA increase,” Mary Johnson, Social Security and Medicare policy analyst at The Senior Citizens League, told CNBC.com this week.
That may vary if you have money withheld from your monthly checks for taxes.
To gauge just how much more money you may see next year, take your net Social Security benefit and add in your Medicare premium and multiply that by the 2023 COLA.
“That will give you a good idea what your raise will be,” said Joe Elsasser, an Omaha, Nebraska-based certified financial planner and founder and president of Covisum, a provider of Social Security claiming software.
This is a breaking news story. Please check back for updates.
