Social Security Announces 2023 COLA
The Social Security Administration (SSA) announced that monthly Social Security benefits will increase by 8.7% beginning January 2023. The average monthly benefit will increase $146, reaching $1,827 per month. This is Social Security’s highest Cost of Living Adjustment (COLA) in 42 years.
The SSA also announced changes to other limits.
- The maximum amount of earnings subject to the Social Security tax for all workers will increase from $147,000 to $160,200. (There is no earnings limit on the Medicare tax.)
- The earnings limit for workers who are younger than full retirement age increases from $19,560 to $21,240. SSA deducts $1 from the benefit for each $2 earned over $21,240.
- The earnings limit for those reaching full retirement age in 2022 increases from $51,960 to $56,520. SSA deducts $1 from benefits for each $3 earned over $56,520 until the month a worker reaches full retirement age. After reaching full retirement age, there is no earnings limit.
Most retirees will pay lower premiums for Medicare Part B in 2023. Most Medicare Part B beneficiaries will pay premiums of $164.90 per month in 2023, down from $170.10. Higher income beneficiaries will continue to pay surcharges of $65.90—$395.60 per month per person based on income. The income thresholds for these surcharges increase in 2023 to $97,000 for individuals and $194,000 for married couples filing jointly. Medicare Part B covers doctors and outpatient services; the premiums are generally deducted directly from Social Security benefits.
For more information, please review the SSA Fact Sheet on 2023 Social Security Changes. If you have any questions, please contact the JRB at 888-JRB-FREE (572-3733) or staff@jrbcj.org.
October 2022