Social Security Administration Announces 1.3% Benefit Increase for 2021
The Social Security Administration announced Tuesday that Social Security beneficiaries will see a 1.3 percent increase to their monthly checks in 2021.
The cost-of-living adjustment will start with benefits payable to over 64 million Social Security beneficiaries in January 2021, the administration said in a news release.
The increased payments will start Dec. 31, 2020, for 8 million beneficiaries.
The annual COLA increase is tied to the Consumer Price Index determined by the Department of Labor’s Bureau of Labor Statistics.
The COLA affects the personal finances of 1 in 5 Americans, including Social Security recipients, disabled veterans and federal retirees, according to CBS News.
The Senior Citizens League, a nonpartisan advocacy group for older Americans, also estimated a 1.3 percent boost based on the BLS data, CNBC reported.
After the 1.3 percent increase, retirees’ estimated average monthly benefit will increase from $1,523 to $1,543 in 2021.
The average monthly benefit for disabled workers will increase from $1,261 to $1,277.
Based on the increase, the Social Security taxable maximum will also increase from $137,700 to $142, 800, according to the Social Security Administration.
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The 1.3 percent cost-of-living adjustment is smaller than the adjustment retirees and other beneficiaries saw in 2020 and 2019.
In 2019, they received a 1.6 percent increase, and in 2019, they received a 2.8 percent increase.
However, the increase is larger than the 0 percent increase beneficiaries saw in 2010, 2011 and 2016 as well as the 0.3 percent increase in 2017.
The average cost-of-living adjustment since 2010 has been 1.4 percent.
In the face of the coronavirus pandemic, Social Security beneficiaries have had a tougher time stretching their benefit checks, according to CNBC.
The Senior Citizens League is asking Congress for an emergency 3 percent COLA to help beneficiaries in 2021.
“We are looking at a period where there are growing inadequacies in Social Security benefits, particularly for people with lower-to-middle benefits,” Senior Citizens League analyst Mary Johnson told CBS News.
The COLA is only part of the annual financial calculation for seniors; Medicare’s “Part B” premium is expected to be announced this fall as well.
“There’s a lot of uncertainty with regard to the effect of the coronavirus on the cost of the premium for next year,” Casey Schwarz from the Medicare Rights Center advocacy group said.
This article appeared originally on The Western Journal.
