Daily Traders Edge

5 Changes To Social Security You Need To Know For 2018

January 12
15:39 2018

Every October, the Social Security Administration (SSA) announces its annual changes to the Social Security program. Here are the changes set to take effect on Jan. 1, 2018, according to the SSA’s annual fact sheet:

1. Social Security beneficiaries will see a 2% increase in payments

For 2018, 66 million Social Security beneficiaries will see a 2% cost-of-living adjustment (COLA). This increase is meant to counteract the effect of inflation. The Bureau of Labor Statistics (BLS) calculates the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), and this calculation ensures that a person’s Social Security check has the same buying power that it did the previous year. If the CPI-W increases more than 0.1% year over year between the third quarter of the previous year and the third quarter of the current year, Social Security will raise beneficiaries’ checks by the same amount.

The 2% bump in 2018 marks the largest COLA increase since 2012, when benefits increased by 3.6%, and is significantly more than 2017’s 0.3% increase. However, for the average Social Security recipient, this 2% raise will amount to just $27 per month, as the average monthly payout increases from $1,377 in 2017 to $1,404 in 2018.

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