NATIONAL NEWS

Social Security benefits to jump by 8.7% next year

Oct 13, 2022, 7:26 AM | Updated: 9:11 am

FILE: In this photo illustration, a Social Security card sits alongside checks from the U.S. Treasu...

FILE: In this photo illustration, a Social Security card sits alongside checks from the U.S. Treasury on October 14, 2021 in Washington, DC. The Social Security Administration announced recipients will receive an annual cost of living adjustment of 5.9%, the largest increase since 1982. The larger increase is aimed at helping to offset rising inflation. (Photo illustration by Kevin Dietsch/Getty Images)

(Photo illustration by Kevin Dietsch/Getty Images)

WASHINGTON (AP) — Millions of Social Security recipients will get an 8.7% boost in their benefits in 2023.

That’s a historic increase and welcome news for American retirees and others — but it’s tempered by the fact that it’s fueled by record high inflation that’s raised the cost of everyday living.

The cost-of living adjustment means the average recipient will receive more than $140 extra a month beginning in January, according to estimates released Thursday by the Social Security Administration.

The boost in benefits. the biggest in 40 years, will be coupled with a 3% drop in Medicare Part B premiums, meaning retirees will get the full impact of the jump in Social Security benefits.

“This year’s substantial Social Security cost-of-living adjustment is the first time in over a decade that Medicare premiums are not rising and shows that we can provide more support to older Americans who count on the benefits they have earned,” said Social Security Administration’s Acting Commissioner Kilolo Kijakaz.

However, a separate government report showed inflation newly accelerating, a trend eating into the Social Security gains for older people. The Consumer Price Index rose 0.4 percent for September after just 0.1 percent in August and is up 8.2 percent for the past 12 months. Jobless claims for unemployment benefits rose for the week.

Stock futures declined before U.S. markets opened.

The Social Security announcement came just weeks before the midterm elections, and at a time when Democrats and Republicans are sparring about high prices now and how best to shore up the program financially in the future.

President Joe Biden has pledged to protect both Social Security and Medicare. “I’ll make them stronger,” he said last month. “And I’ll lower your cost to be able to keep them.”

About 70 million people — including retirees, disabled people and children — receive Social Security benefits. This will be the biggest increase in benefits that baby boomers, those born between the years 1946 and 1964, have ever seen.

Willie Clark, 65, of Waukegan, Illinois, says his budget is “real tight” and the increase in his Social Security disability benefits could give him some breathing room to cover the cost of the household expenses he’s been holding off on.

Still, he doubts how much of the extra money will end up in his pocket. His rent in an apartment building subsidized by the U.S. Department of Housing and Urban Development is based on his income, so he expects that will rise, too.

Social Security is financed by payroll taxes collected from workers and their employers. The maximum amount of earnings subject to Social Security payroll taxes for 2023 is $160,200.

The financing setup dates to the 1930s, the brainchild of President Franklin D. Roosevelt, who believed a payroll tax would foster among average Americans a sense of ownership that would protect the program from political interference.

Next year’s higher payout, without an accompanying increase in Social Security contributions, could put additional pressure on a system that’s facing a severe shortfall in coming years.

The annual Social Security and Medicare trustees report released in June says the program’s trust fund will be unable to pay full benefits beginning in 2035.

If the trust fund is depleted, the government will be able to pay only 80% of scheduled benefits, the report said. Medicare will be able to pay 90% of total scheduled benefits if the fund is depleted.

In January, a Pew Research Center poll showed 57% of U.S. adults saying that “taking steps to make the Social Security system financially sound” was a top priority for the president and Congress to address this year. Securing Social Security got bipartisan support, with 56% of Democrats and 58% of Republicans calling it a top priority.

Some solutions for reforming Social Security have been proposed — but none has moved forward in a sharply partisan Congress.

Earlier this year, Sen. Rick Scott, R-Fla., issued a detailed plan that would require Congress to come up with a proposal to adequately fund Social Security and Medicare or potentially phase them out.

Senate Minority Leader Mitch McConnell, R-Ky., publicly rebuked the plan and Biden has used Scott’s proposal as a political bludgeon against Republicans ahead of midterm elections.

“If Republicans in Congress have their way, seniors will pay more for prescription drugs and their Social Security benefits will never be secure,” Jean-Pierre said.

___

Claire Savage in Chicago contributed to this report.

KSL 5 TV Live

National News

Utah Gov. Spencer Cox, left, and President Joe Biden toast before Biden speaks to members of the Na...

Darlene Superville, The Associated Press

Biden and Utah’s governor call for less bitterness and more bipartisanship

President Joe Biden and Utah Gov. Spencer Cox disagree on many issues but they were united Saturday in calling for less bitterness in politics and more bipartisanship.

9 minutes ago

Sandra Young went missing from the Portland metro area more than five decades ago. (Oregon State Po...

Dalia Faheid, CNN

Remains of Oregon teenager are identified 50 years later after someone uploaded their DNA into genealogy site

The remains of a Portland, Oregon, teenager who vanished in the late 1960s have been identified through advanced DNA testing more than 50 years after she went missing, authorities said

2 hours ago

FILE - The company logo hangs over the door to an AT&T store Thursday, Feb. 22, 2024, in Denver...

Associated Press

AT&T will give $5 to customers hit by cellphone network outage

AT&T says it will give affected customers $5 each to compensate for last week's cellphone network outage that left many without service for hours.

2 hours ago

Kathy Brandel and Ralph Hendry, from Virginia, were spending the winter cruising the Eastern Caribb...

Sharif Paget, Chris Boyette and Polo Sandoval, CNN

2 Americans believed dead after yacht allegedly hijacked in Grenada

The family of two Americans who may have been killed after prison escapees allegedly hijacked their yacht in Granada are clinging to hope the couple might be found alive.

4 hours ago

A paddle boarder tows an inflatable unicorn on a temporary lake in Death Valley on Thursday, Feb. 2...

Ty O'Neil, John Locher and Stephanie Dazio, The Associated Press

Kayakers paddle in Death Valley after rains replenish lake in one of Earth’s driest spots

Kayakers have been paddling in one of the driest places on Earth after a series of record rainstorms battered California’s Death Valley and replenished Lake Manly.

5 hours ago

Kingsley Ben-Adir, izquierda, protagonista de "Bob Marley: One Love" posa con el hijo de Marley, Zi...

Jonathan Landrum, Jr., The Associated Press

‘One Love’ receives more love at the box office, claiming No. 1 spot for second straight week

For a second straight week, biopic “ Bob Marley: One Love ” continues to exceed expectations by claiming the No. 1 spot at the box office, overcoming two debut films and Sony's “Madame Web” that's still producing subpar numbers.

6 hours ago

Sponsored Articles

Modern chandelier hanging from a white slanted ceiling with windows in the backgruond...

Lighting Design

Light Up Your Home With These Top Lighting Trends for 2024

Check out the latest lighting design trends for 2024 and tips on how you can incorporate them into your home.

Technician woman fixing hardware of desktop computer. Close up....

PC Laptops

Tips for Hassle-Free Computer Repairs

Experiencing a glitch in your computer can be frustrating, but with these tips you can have your computer repaired without the stress.

Close up of finger on keyboard button with number 11 logo...

PC Laptops

7 Reasons Why You Should Upgrade Your Laptop to Windows 11

Explore the benefits of upgrading to Windows 11 for a smoother, more secure, and feature-packed computing experience.

Stylish room interior with beautiful Christmas tree and decorative fireplace...

Lighting Design

Create a Festive Home with Our Easy-to-Follow Holiday Prep Guide

Get ready for festive celebrations! Discover expert tips to prepare your home for the holidays, creating a warm and welcoming atmosphere for unforgettable moments.

Battery low message on mobile device screen. Internet and technology concept...

PC Laptops

9 Tips to Get More Power Out of Your Laptop Battery

Get more power out of your laptop battery and help it last longer by implementing some of these tips from our guide.

Users display warnings about the use of artificial intelligence (AI), access to malicious software ...

Les Olson

How to Stay Safe from Cybersecurity Threats

Read our tips for reading for how to respond to rising cybersecurity threats in 2023 and beyond to keep yourself and your company safe.

Social Security benefits to jump by 8.7% next year