The way to estimate your month-to-month funds for 2022
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After the Social Security Agency announced a record high cost of living adjustment for 2022, many beneficiaries ask, “How much bigger will my monthly checks be?”
Individuals on social security or supplementary insurance income or SSI benefits will receive a 5.9% increase in their payments over the next year.
That’s the highest increase since 1982. The last time COLA got close was in 2009 when it was 5.8%.
More than 64 million social security recipients are expected to receive major controls in January. The same applies to around 8 million SSI receivers.
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The annual adjustments are based on inflation. Larger monthly checks mean that consumer prices have also risen. As a result, the extra money can’t go that far.
The average monthly pension will increase by $ 92 – to $ 1,657 in 2022 from $ 1,565 in 2021.
However, the amount of the increase varies depending on the beneficiary.
“Anyone currently receiving a benefit should look at their performance and imagine what an approximately 5.9% increase in that benefit level will bring,” said Stephen Goss, senior actuary with social administration, in a recent webinar hosted by the company non-partisan policy center.
However, there is one thing that offsets the size of these checks: the Medicare Part B premiums.
These Medicare Part B payments are often deducted directly from the beneficiaries’ monthly checks. However, not everyone has Medicare Part B coverage, especially if they are still covered by employer health insurance or if they have not reached the Medicare eligibility age of 65.
The standard Medicare Part B premium is expected to be $ 158.50 per month, up from $ 148.50 this year. However, the prices for next year have not yet been officially announced.
If you’re not covered by Medicare Part B, you can multiply your monthly benefit amount by 1.059 to roughly match your payment for the next year, said Joe Elsasser, founder and president of Covisum, a social security claims software company.
If you’re covered by Medicare Part B, subtracting $ 10 from that calculation could get you pretty close to your monthly payment for 2022, Elsasser said.
There is a caveat, however. Individuals with incomes above a certain level pay more for Medicare Part B coverage. This is known as the earnings-related monthly adjustment amount, or IRMAA.
A new table of Medicare Part B premiums for 2022 has also not yet been released. However, this year’s IRMAA rates will likely be pretty close, Elsasser said.
Both social security and SSI beneficiaries will be informed by post in December of the amount of their benefit payments for the next year. This information will also be available online through personal My Social Security accounts.
New benefit amounts for 2022 will not be calculated for Medicare policyholders until the premiums for the next year have been announced. Medicare changes for 2022 will be available at Medicare.gov.