The Social Security Administration announced this week that it is doing something that it hasn’t done since 2009 – give it’s recipients a cost of living adjustment. Social Security really does not have much choice on whether or not to increase benefits. The system as it is set up is based on the Consumer Price Index for urban wage earners and clerical workers and is monitored by the Bureau of Labor Statistics. The adjustment will be an extra 3.6% per beneficiary. The new wages will take effect January 1, 2012, for individuals receiving retirement and disability insurance benefits. Those receiving Supplemental Security Income will show changes starting December 30, 2011.
These increases will also mean some additional increases for Social Security. The maximum amount of taxable earnings for Social Security will increase by $3,300 to $110,100. Additionally, the amount of money needed to earn 1 quarter of coverage has gone up $10 to $1,130 (so to get all 4 of your quarters for 2012 and beyond you will need wages of at least $4,520). The level of work to be considered Substantial Gainful Activity has gone up to $1,010/month.
What about SSI payments? Those will go up to $698/month. But what isn’t going up are the income and resource requirements for SSI. For an individual they remain at $2,000 and $3,000 for a couple. Please let me know if you have any questions about the possible increase in your benefits.