The government has announced that Social Security benefits will go up by 1.5 percent. This will affect individuals that are disabled and individuals receiving Supplemental Security Income.
The cost-of-living-adjustment or COLA concerning these benefits is in place for Social Security recipients in the event of inflation. The hope in providing such an adjustment is that beneficiaries can maintain their standard of living.
Though any increase in benefits is welcome, Missouri readers need to remember that the boost is a very modest one. For most Social Security beneficiaries, the increase amounts to $19 per month. The 1.5 percent increase marks only the seventh time that the COLA has been lower than two percent. The amount of tax withdrawn from workers’ paychecks to pay for the additional benefits is also increasing.
The formula for funding of Social Security is to have the worker pay for half of his or her share and the employer to pay for the rest concerning the tax. The amount withdrawn from the employee’s paycheck is 12.4 percent on the first $113,700 in income earned by the worker. However, this threshold will increase to $117,000 in 2014.
Disabled individuals face a number of obstacles in attempting to remain above water financially. The reason why they are receiving Social Security disability insurance or SSDI benefits is due to the fact that the disability is preventing them from continuing to work. Such individuals often have to pay for a number of services regarding their daily care. Adjustments in payments to meet inflation only mean that these individuals are not being placed in an even greater financial bind.
Source: Columbia Daily Tribune, “Social Security COLA set at 1.5 percent,” Oct. 30, 2013