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Articles Tagged with Social Security Benefits

A new year can prompt new changes for Social Security and their applicants. Multiple sources are claiming that there will be 3 major changes for the program. Since the changes that are only proposed, there is no guarantee they will go into effect in 2021. In addition to the 3 major changes, it is possible that other changes and statues can occur as well. In 2021, it is important to stay informed about Social Security and any new adjustments that they may make. The 3 major potential changes are listed and described below.

There will be a 1.3% cost-of-living adjustment.

Beginning in January, the annual cost-of-living adjustment (COLA) will be set at 1.3 percent. Social Security states that cost-of-living adjustments allow Social Security and Supplemental Security Income (SSI) benefits to keep pace with inflation. The Social Security Administration determines a formula to calculate COLAs. According to AARP, the monthly Social Security benefits will increase by $20 for the majority of retired workers. As a result, the average annual benefit will be approximately $1,543. Previously, the annual amount was estimated to be $1,523 in 2020. In addition, retired couples and disabled workers will also receive an increase in COLA. Retired couples can potentially receive an increase of $33, and disabled workers can receive an increase of $16. Overall, the greatest monthly payment that people can receive from Social Security would be $3,148, which is an increase from $3,011 in 2020.

The Social Security Administration claims that almost nine out of ten people who are 65 years of age or older receive Social Security benefits. In addition to Social Security Disability, the Social Security Administration (SSA) provides a retirement program to people who work in the United States. As defined by the SSA, the program administers retirement income to eligible retirees and their families. It is important to be informed about the specific benefits of retirement, as well as information that may be helpful when applying.

As defined by the SSA, Social Security replaces a percentage of an employee’s pre-retirement income based on their lifetime earnings, specifically the highest 35 years of earnings and when they choose to start receiving benefits. The tax money that workers pay to Social Security provide benefits to workers who are retired, disabled, survivors, or dependents of beneficiaries. Statista wrote on their website that there were approximately 45.1 million retired workers that received Social Security benefits in 2019.

The SSA defines more information about eligibility on their website. They write that individuals are able to apply for retirement benefits when they reach a certain age and have worked and paid toward Social Security in order to receive benefits. As stated on the website, a worker earns “credits” that are used to track their Social Security benefits. An individual must have 40 credits in order to be eligible. If they do not work and have not received the sufficient amount of credits, they will be unable to receive retirement benefits. The number of credits varies on the year that a person was born. As described by the SSA, people who were born in 1929 and beyond need to achieve 40 credits. To estimate, this would be equal to approximately 10 years of work experience.

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