Yesterday was the first day of 2022, and already there are major changes happening for Social Security recipients.
Over 70 million Americans collect Social Security benefits every month for retirement or disability.
For people ages 65 and older, 9 out of every 10 individuals collect Social Security.
Here are 5 big changes coming to those who collect Social Security benefits
First, there will be a 5.9% increase in monthly payments
The Social Security Administration announced in Oct. that the increase would be 5.9% starting in Jan. 2022.
People should have received letters from the SSA that detail their new benefit details.
The COLA increase was so high in order to allow retired and disabled individuals to retain their purchasing power after inflation.
Those on SSDI will collect a larger monthly benefit as well
The 5.9% increase will apply to people collecting SSDI as well.
The increase for SSDI checks will be an average of $76.
SSDI is for people with disabilities who can’t work the same way they used to.
The earnings limit for those still working will increase in 2022
Anyone working on Social Security could see their benefits go down depending on how high their wages are.
For anyone who made $18,960 during 2021, the SSA withheld $1 for every $2 earned past that point.
In 2021 the wage limit is $19,560.
For those at full retirement age, the limit for 2021 was $50,520 and $1 withheld for every $3 earned past that.
In 2022 the wage for FRA will be $$51,960.
The threshold for credits will rise
Anyone born over 1929 needs to earn 40 credits before they can retire.
In 2021 a credit was worth $1,470 and in 2022 will be $1,510.
The increase is $40, and it is adjusted to align with inflation every year.
Workers will pay more in Social Security taxes in 2022
In 2021, high earners only needed to pay Social Security taxes on the first $142,000 of their wages.
In 2022, that limit will rise to $147,000.
This makes it so those earning higher wages will be paying even more into Social Security.