Each year around this time, Social Security publishes its list of changes for the following calendar year, including important cost-of-living adjustments. This year, based on the Consumer Price Index, only a very small cost-of-living increase of .3 percent is being applied.
This means the monthly benefits paid to the disabled and retirees and their dependents under Title II of the Social Security Act (the part of the program that pays benefits based on your or a family member’s work record) will go up just a little effective in January 2017. The maximum monthly Social Security benefit will now be $2687, up from $2639. The average benefit will be $1360 for retired workers and $1171 for disabled workers. In addition, the maximum monthly SSI benefit (the needs based program for the disabled and retired that is not based on any earnings record) will now be $735 per month, up from $733.
Other changes in the program, not necessarily related to the cost of living but that are subject to annual changes, include the maximum amount of earnings which are subject to FICA taxes for wage earners to pay into the system. This amount will now be $127,200 per year, up from $118,500 in 2016. A person who has retired early (before their full retirement age) can earn up to $1410 per month or $16,920 per year before having their retirement benefit reduced. For persons retiring at full retirement age, the maximum earnings allowed for months in that year prior to the attainment of full retirement age before reduction in their benefit is $44,880. (Beginning with the month the retiree attains full retirement age, there is no earnings limit.)
The substantial gainful activity (SGA) limitation is now $1170 per month. This is the maximum amount a disabled worker can earn without a potential impact on disability benefits. In addition, earnings of $1300 are now required for a worker to be credited with a quarter of coverage for Social Security Disability Insurance benefits.
For all of the changes and updates, check out the Fact Sheet available on Social Security’s website at www.ssa.gov.