Most seniors are probably aware the cost-of-living adjustment (COLA) for Social Security benefits in 2022 is the largest in decades. However, Nasdaq is advising of three significant changes that may affect beneficiaries in the new year.
First, the 5.9 percent COLA increase doesn’t mean all recipients will get the full effect of the raise. In general, the average benefit of $1,565 will rise to $1,657, a hike of $92 or $1,104 annually. However, those on Medicare whose Part B premium is paid out of their Social Security benefits will see their premium increase by $21.60, thus eating into the COLA raise along with inflation.
Second, the Social Security Administration (SSA) has set a higher earnings limit for those still working. Exceeding the limit will subject some of the benefits to taxation. For those who’ve claimed Social Security before their Full Retirement Age (FRA), the limit on extra earnings is increasing from $18,960 to $19,500 for 2022.
Finally, the cap on earnings subject to payroll taxes is increasing from $142,850 to $147,000, meaning an additional $4,200 will be subject to withholding. This change will especially impact self-employed individuals.
So, plan your 2022 budget accordingly.
You Deserve Better Benefits
Here at Council of Seniors, we’re trying hard to get Congress to pass The SAVE Benefits Act. We need action on this bill to make the annual Social Security cost of living adjustment (COLA) more meaningful. If passed, seniors will be reimbursed $581 that’s missing because of previously inadequate COLAs.
Please sign our petition right away. Washington politicians need to wake up and see how many people support this bill. Any help you can provide will be greatly appreciated.
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