In 2022, Social Security will be making the largest cost-of-living adjustment in nearly 40 years. The result is that payments will grow by 5.9%. Other adjustments to the program could affect how much you receive in your payments or how much you pay into the system. Here is a quick breakdown.
 

Are you retired and receiving Social Security payments?

You will see a 5.9% increase in your payments. The average benefit for retired workers is expected to climb by $92 to $1,657 per month as a result of the cost-of-living adjustment. However, part of your cost-of-living adjustment could be used to pay for Medicare premiums. You can view the benefit amount you will receive by logging into your my Social Security account.
 

Are you still working and paying into the Social Security system?

Currently, you pay 6.2% of your earnings until your income exceeds the taxable minimum. In 2022, earnings above $147,000 (up from $142,800) will have surpassed the taxable maximum. Any earnings above this amount will not be used to calculate future Social Security payments.
 

Are you receiving Social Security payments and still working?

Social Security beneficiaries who continue to work will be able to earn $600 more in 2022 before part of their Social Security benefit is temporarily withheld. Review the Social Security Administration’s fact sheet to see the breakdown on earnings limits.

 

Wondering when you will reach “full retirement age” so you can start receiving maximum Social Security payments?

If you are turning 62 in 2022 you will need to wait until an older retirement age than existing Social Security beneficiaries in order to claim your full retirement benefit. The full retirement age for those born in 1960 is 67, two months older than the full retirement age of 66 and 10 months for those born in 1959.

For detailed information, read the Social Security Administration’s notice here. We know some of this can be overwhelming. We’re here for your retirement planning needs. Make an appointment with our Investment Center to talk through your unique situation.