1: Social Security Administration Hands Out the Biggest Raise (COLA) since 2012The SSA makes an annual determination on whether to award a cost-of-living-adjustment, or COLA, to beneficiaries. The purpose of the COLA is to ensure that yearly benefits keep pace with inflation. The “raise” or COLA allows the beneficiary to have the same relative amount of purchasing power year-over-year. The SSA uses the Consumer Price Index for Urban Wage Earnings and Clerical Workers (CPI-W) to calculate the COLA. The CPI-W measures several factors, from energy prices to the costs of goods and housing expenses, to determine an appropriate increase to keep benefit amounts at the same relative level of buying power. 2019’s COLA is a whopping 2.8%! That’s a full .8% increase over the 2018 COLA and .8% less than the 3.6% COLA of 2012. The relatively large increase is not the only good news: the fact that the SSA awarded a COLA is important, as the COLA is not guaranteed. Many people take the COLA for granted, but there have been three years—2009, 2010, and 2015—with no COLA increase.
2: Increased Earning Limits for Social Security Retirement BenefitsAre you working and collecting Social Security retirement benefits, or do you plan to keep working when you file for your Social Security retirement benefits? If so, you are not alone. It is not uncommon for retirees to continue to work in some capacity after filing for Social Security retirement benefits. The SSA imposes a limit on how much you can earn while working and collecting benefits. If you are under full retirement age (also known as FRA—learn more here) the SSA deducts $1 for every $2 you earn above the annual limit. For 2018 the limit is $17,040. The new limit for 2019 will be $17,640, a $600 increase. In the year you reach full retirement age, the limit substantially increases. In 2018 the earning limit for the year you reach FRA is $45,360. The SSA deducts $1 in Social Security benefits for every $3 above the limit. In 2019 the amount will increase by $1,560 to $46,920. It’s important to understand that the full retirement age earning limit is ONLY for the year you reach FRA. After you reach FRA, there is no longer an earning limit.
3: Online Access to COLA noticesThe SSA will give Social Security beneficiaries the ability to access COLA notices online through the mySocialSecurity account system. COLA notices are currently sent by mail. The ability to access notices online through the mySocialSecurity system is one of many incremental increases the SSA has made with online access to pertinent information and services.
The Looming Specter of Social Security Cuts: Don’t Worry About It in 2019Every election cycle—and sometimes more frequently—special interest groups and politicians will invoke the boogeyman of Social Security’s deficit. This year that honor seems to belong to Senate Majority leader Mitch McConnell (R-KY). The media reported that McConnell blamed a rise in the U.S. budget deficit ($779 billion, a 77% increase from the $439 billion deficit of 2015) to an “unwillingness to address entitlement reform, and we’re talking about Medicare, Social Security, and Medicaid.” Pundits and political opponents flooded the internet and other media channels with pronouncements that McConnell was seeking to gut Social Security. Do not be alarmed! There is no indication that there are any plans to reduce Social Security retirement benefits in 2019 or the near future.
This free Social Security workshop will be held at 6:30 pm on November 13th and November 15th. The workshop will teach attendees the most common strategies and filing situations for individuals and couples. Registration is free, attendance is limited. A catered, full-service buffet will be provided.