2020 increase of Social Security: 1.6 percent

Nov 21st, 2019 | By | Category: News

Social Security and Supplemental Security Income (SSI) benefits will increase 1.6 percent in 2020, a smaller increase than either of the past two years.

The Social Security Administration announced next year’s cost-of-living adjustment (COLA) will begin in January with benefits payable to more than 63 million Social Security beneficiaries. Increased payments to more than 8 million SSI beneficiaries will begin sooner, on Dec. 31, 2019.

Some people receive both sets of benefits.

The benefit increases the previous two years were 2.8 percent in 2019 and 2 percent in 2018.

COLAs, which keep Social Security benefits in line with inflation, are tied to increases in the Consumer Price Index as determined by the federal Department of Labor’s Bureau of Labor Statistics. As the cost of living increases, so do Social Security benefits.

Social Security and SSI beneficiaries are normally notified by mail in early December about their new benefit amounts. Most people who receive Social Security payments will be able to view their COLA notice online through their Social Security accounts.

According to Medicare Rights Center, a non-profit advocacy organization for Medicare beneficiaries, the 2020 COLA should cover the expected increase in the monthly Medicare standard Part B premium. The COLA will increase the average Social Security benefit by about $32 dollars a month. Based on estimates from the Medicare Trustees, the standard Part B premium is projected to go from $135.50 to approximately $144.30 per month, or $8.80 higher.

The new premium amount hadn’t been announced officially as of mid-October.

Another adjustment that takes effect in January each year is the maximum amount of earnings subject to the Social Security tax. The taxable maximum in 2020 will $137,700, about $5,000 higher than the previoius level of $132,900.

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