Have you noticed a slight increase in your Social Security benefits lately? Starting January 2024, more than 71 million Americans can expect an average increase of $50 per month in their social security retirement benefits thanks to a 3.2% cost-of-living adjustment.
In a press release, the Acting Commissioner of Social Security, Kilol Kijakazi, noted the increase to both Social Security and Supplemental Security Income (SSI) benefits will, “help millions of people keep up with expenses.” This comes as no surprise considering inflation rose by 3.4% in 2023 and savings accounts across the country have steadily dwindled.
The 3.2% increase is a welcomed income addition to help offset these rising costs. Here are the Social Security cost-of-living adjustments that you can expect.
Social Security beneficiaries can expect a cost-of-living adjustment notice available in their my Social Security account which details the updated benefit rates per individual along with other pertinent information.
While benefit receivers can celebrate the cost-of-living adjustment, it’s not out of the ordinary for the Social Security Administration (SSA) to reassess and adjust based on a number of economic factors, like inflation. In 1975, the SSA began automatic cost-of-living adjustments to counteract the effects of inflation and maintain purchasing power of recipients.
To determine the cost-of-living adjustment for the upcoming year, the Social Security Administration considers changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which measures the average price changes over time of goods and services. If there are no changes to this metric, there are no cost-of-living adjustments.
The 3.2% benefit boost will bring a welcome relief to Social Security receivers. This adjustment will help retirees, disabled individuals, and their families keep up with the rising costs of healthcare, housing, and other necessary expenses.
To make the most of the Social Security cost-of-living increase in 2024, it is essential to have a solid financial plan in place. Here are a few strategies to consider as you reassess your finances:
Evaluate Your Budget: Assess your current income and expenses and adjust your budget accordingly. Prioritize essential needs and allocate funds wisely to make the most of your benefits.
Review Retirement Goals: Take the opportunity to revisit your retirement goals and reassess your long-term financial objectives. Adjust your savings and investment plans to align with your desired lifestyle.
Seek Professional Guidance: Consult a financial advisor who can help optimize your Social Security benefits. They can help you navigate complex financial decisions and provide personalized strategies tailored to your unique circumstances. Prudent Investors is here to help.
Remember, the Social Security cost-of-living adjustments for 2024 presents an opportunity to enhance your retirement income. With careful planning and strategic financial management, you can ensure a more secure and comfortable future. If you’re interested in social security modeling or goal-based financial planning, we welcome you to connect with Prudent Investors.
Investment advice through Prudent Investors, an SEC-registered investment advisor. This blog is general communication being provided for informational purposes only. This information is in no way a solicitation or offer to sell securities or investment advisory services. It is educational in nature and not to be taken as advice or a recommendation for any specific investment product or investment strategy. This does not contain sufficient information to support an investment decision. Any investment or investment strategy mentioned may not be suitable for all investors or in their best interest. Statistical information, quotes, charts, references to articles or any other quoted statement or statements regarding market or other financial information is obtained from sources which we believe reliable, but we do not warrant or guarantee the timeliness or accuracy of this information. All rights are reserved. No part of this blog including text, graphics, et al, may be reproduced or copied in any format, electronic, print, et al, without written consent from Prudent Investors. Prudent Investors does not provide legal or tax advice. Please be advised to consult with your investment advisor, attorney or tax professional before making any investment decisions.
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