Millions of Social Security beneficiaries get an 8.7% boost in 2023

Millions of Social Security beneficiaries will increase their benefits by 8.7% in 2023. This is a historic increase driven by inflation. The Social Security Administration said: announced on Thursday.

This is a historic increase and welcome news for American retirees and others.

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The cost of living adjustment means the average beneficiary will receive an extra $140 or more a month starting in January, according to estimates released Thursday by the Social Security Administration.

Benefit boost. The biggest in 40 years, combined with his 3% cut in Medicare Part B premiums, means retirees can take full advantage of the surge in Social Security benefits.

“This year’s significant Social Security cost-of-living adjustment marks the first time Medicare premiums haven’t risen in over a decade, helping to provide more support to older Americans who rely on the benefits they’ve earned. ,” said Social Security. Acting Chief Executive Kiroro Kijakazu.

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But another government report showed a new acceleration in inflation and a trend to prey on increases in social security for the elderly. It rose 0.4% in January and has increased 8.2% over the last 12 months. Jobless claims for unemployment benefits rose this week.

Social Security’s announcement comes just weeks before the midterm elections, as Democrats and Republicans debate the current high prices and how best to financially strengthen the program in the future. rice field.

President Joe Biden has promised to protect both Social Security and Medicare. “I make them stronger,” he said last month. “And then lower the cost so we can keep them.”

About 70 million people, including retirees, people with disabilities and children, receive social security benefits. This would be the largest benefit increase ever experienced by baby boomers born between 1946 and his 1964.

Willie Clarke, 65, of Waukegan, Illinois, said his budget was “very tight” and an increase in Social Security disability benefits would give him a breather to pay for household expenses he’s been holding back. I say it might.

Still, he wonders how much of the extra money will fit in his pocket. is expected to rise as well.

Social security is funded by payroll taxes collected from workers and their employers. The maximum amount of income subject to the Social Security Payroll Tax in 2023 is $160,200.

The funding mechanism dates back to the 1930s and was the brainchild of President Franklin D. Roosevelt. President Roosevelt believed that a payroll tax would foster a sense of ownership among average Americans that would protect the program from political interference.

Higher payments next year, without an accompanying increase in Social Security contributions, could put more pressure on a system facing severe shortfalls in the coming years.

Starting in 2035, the program’s trust fund will no longer be able to pay its full amount, according to the annual Social Security and Medicare report released in June.

If the trust fund were to dry up, the government would only be able to pay 80% of the scheduled benefits, the report said. If funds are exhausted, Medicare can pay 90% of all planned benefits.

A January Pew Research Center poll found that 57% of U.S. adults said “taking steps to make the Social Security system financially sound” is the top priority for the president and Congress this year. Securing Social Security has bipartisan support: 56% of Democrats and 58% of Republicans call it a top priority .

Several solutions have been proposed to reform Social Security, but none have made headway in the heavily partisan Congress.

Earlier this year, Sen. Rick Scott (R-Florida) laid out a detailed plan calling for Congress to issue a proposal that could fully fund or phase out Social Security and Medicare. announced.

Senate Minority Leader Mitch McConnell (R-Ky.) publicly denounced the plan, and Biden used Scott’s proposal as a political stick against Republicans ahead of the midterm elections.

“If Republicans in Congress get their way, seniors will pay more for prescription drugs and their Social Security benefits will never be secure,” Jean-Pierre said.

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