What Will Change in Social Security in 2018?

According to the news report by CNBC, those planning to celebrate an increase in their Social Security benefits in 2018 may be celebrating too early.

According to the report, the Social Security Administration announced in October that the Cost of Living Adjustment (COLA) would increase by 2%. This would be the biggest COLA increase since 2012. This increase would mean that the more than 66 million SS beneficiaries would see a $25 increase in their benefits payout every month. This means the average per month benefit will increase from $1,283 to $1,258.   

However, according to The Senior Citizens’ League, about 70% of the recipients will not even see this money. This is because about 70% of the recipients are also on Medicare. And there is also going to be an increase in Medicare Part B Premiums, which are usually deducted from Social Security payouts. According to Dan Adcock, a policy expert from the NCPSSM, that 70% will only see about a $2 increase per month.

The other 30% that isn’t enrolled on Medicare will see the increase in their Social Security checks from January 2018 onwards.

There are also other changes expected next year which will affect everyone who is on Social Security. Here are a few tips on how to maximize your social security benefits.

According to a survey conducted by Nationwide Institute, 91% of the respondents didn’t know which factors would impact the payout that they could receive. This can be hugely detrimental to beneficiaries, especially when more than 66% of retirees depend on SS benefits for 50% of their monthly income. And of them, about 33% depend on Social Security benefits for more than 90% of their income. So, here are a few things to watch out for in 2018.

• The full age for retirement will be nearer to 67 in 2018. This means that the 1956 born will be qualified to collect their Social Security in 2018 when they reach 62. However, they will need be 66.25 years old to collect their full benefits. To figure out what your full age for retirement is, you can check the Full Retirement Age Chart.

• The income that is subject to Social Security tax is increasing. This means at least 12 million more people are going to pay more Social Security taxes.

• For people who have higher incomes and who enrolled in the program at full retirement age, the maximum Social Security benefit will increase by 3.7%.

• If you filed for social security before the full age for retirement, but are still working, then you will be eligible for a little extra without being penalised for it.

People should start planning for retirement earlier now. If the new proposed tax bill is passed, then retirees will see even lower COLA increases in the future. Additionally, something will need to be done to start lowering the huge federal debt, and this could mean government programs such as SS could end up being scrapped.