In addition to dealing with short term disability benefits, long term disability benefits, and health insurance denials, many of our clients are also tasked with keeping track of changes to their Social Security benefits. Here are some of the changes that will take effect on January 1, 2020 for Social Security recipients –
- Social Security recipients will get a 1.6 percent cost-of-living adjustment (COLA) in their monthly benefits starting in January. The average individual retired Social Security beneficiary is expected to see a monthly benefit jump from $1,479 to $1,503, an increase of roughly $24 per month or $288 for the year.
- As a result of the COLA, the maximum monthly benefit a single recipient can get also will grow. That benefit will increase from $2,861 per month in 2019 to $3,011 per month in 2020.
- If you are between ages 62 and 66 or 67 (full retirement age) and working while also receiving monthly Social Security benefits, in 2020 you will be able to earn up to $18,240 ($1,520 per month) before the Social Security Administration deducts $1 from your benefits for every $2 you earn. In the year you turn your full retirement age, the earnings limit will be $48,600 ($4,050 per month) before the agency will deduct $1 for every $3 you earn until the month you reach full retirement age. (For those born between 1943 and 1954, full retirement age is 66. It increases by two months for each year after until 67.) The earnings limit disappears once you reach full retirement age.
- Taxes on workers’ wages finance Social Security. Workers pay 2 percent of their earnings to fund the benefit (employers pay the same). Next year, the maximum amount of earnings subject to the Social Security tax will increase from $132,900 to $137,700.
- The earnings required for one work credit — that is, three months of Social Security coverage — edges up from $1,360 to $1,410 for 2020. Credits are the building blocks the Social Security Administration uses to determine whether you qualify for benefits. You can earn up to four credits a year if you earn at least $5,440. In most cases, to qualify for benefits you’ll need a minimum of 40 credits.
- Beneficiaries receiving Supplemental Security Income (SSI) will also see an increase in their monthly payment. SSI is a federal program that aids the aged, blind and people with disabilities who have little or no income by providing them funds for food, clothing and shelter. The individual amount grows by $12 a month, from $771 to $783. The amount for couples rises $18, from $1,157 to $1,175.
To check the amount of your 2020 Social Security monthly benefit, go to SSA.gov, and, if you already have a My Social Security account, sign in and check your account’s message center. To create a My Social Security account, go to www.socialsecurity.gov/myaccount.
To see how these changes may affect your own insurance benefits, please contact Kantor & Kantor for a no-cost consultation at (800) 446-7529 or use our online contact form.