With the new year, people tend to look towards newer and brighter possibilities. A new year provides everyone a fresh start for opportunities and change.
A change that millions of Americans have been looking forward to this year comes from an announcement made in 2020 by the Social Security Administration (SSA) in regards to the annual cost-of-living adjustment increasing by 1.3 percent. SSA is an independent agency of the federal government, administering both Social Security and Supplemental Security Income (SSI) benefits.
According to AARP, this means that for the average retired worker, the monthly Social Security benefit has increased by $20 compared to what was received in 2020 which makes the new monthly average total to $1,543. The average disabled worker will see a monthly increase by $16, making the monthly average $1,277. An individual retiring at full retirement age will receive an increase by a maximum of $137 compared to 2020.
SSI recipients will see a 1.3 percent increase in their monthly benefits, which is an increase of about $11, making the average total to $794 per month. SSI is funded through the general tax revenue and is used to help individuals who receive little to no income meet their basic living needs.
There is also an increase to the payroll tax earnings cap. All earned income up to $142,800 in 2021 will be taxable, which is an increase of $5,100 from 2020. Any earnings over that amount will be exempt from payroll taxes.
To learn more about the changes on Social Security, visit usa.gov/about-social-security. To find a social security office near you, speak with a Community Resource Specialist: (408) 350-3200, option 1.