Changes in Social Security for 2019 – 2019 social security changes fact sheet, Changes are a necessity of every program. The same is true for the Social Security program in the US. Every year in the month of October, the SSA introduces the changes on a yearly basis to the program. This year also, there are a number of changes that will take effect from the initial month of 2019, i.e. January. There is an annual fact sheet by the SSA, which gives complete details about the changes that will be going to work this year.
So, start reading those changes if you are willing to become a knowledgeable individual about the Social Security program in the United States. Here is a glimpse:
Changes in Social Security for 2019
An increase in the full retirement age will continue
When it comes to the earliest age to get Social Security retirement benefits, is 62. If you claim before the normal or full retirement age, then it will give the reduced payout on a permanent basis. For people who reach the age of 62 in 2018, then 66 and 4 months is the full retirement age for them.
While on the other hand, if a person reaches the age of 62 in 2019, then his or her full retirement age will extend to 66 and 6 months. Till the 67 age is hit, there will be an increase in the full retirement age by 2 months every year.
According to this update, if any person is born in 1960 or later, then 67 will be the full retirement age. In any case, if a person delays claiming the benefits of Social Security earlier than his or her full retirement age, then he or she can get more than the full disbursement.
Higher taxable paychecks will rise to $132900
It is a known fact that an employee was needed to pay the Social Security tax, which is equal to 6.2% on salary up to $128400 in 2018. If the salary is higher than this limit, then there was no need of paying the tax. When it comes to the 2019 update, the rate of the tax will be the same at 6.2%, however, there is a change in the tax cap limit, which is extended to $132900.
It states that the higher amount of paychecks used by the Social Security Administration to compute retirement benefits is dependent on the taxable maximum increase. In the previous year, the maximum benefit for an employee retiring at full retirement age was 2788 dollars on a monthly basis. However, this year, it will be $73 to $2861 per month.
A rise in payments to 2.8 percent for beneficiaries
This year would be great for people who will get the 2.8 percent in expenses as a beneficiary. Expenses are all about COLA (Cost of Living Adjustment). Based on the update, it is concluded that more than sixty-seven million beneficiaries of Social Security will receive this change. The objective of this increase is to overcome the effect of inflation.
According to the calculation of the BLS for CPI-W, it makes sure that an individual Social Security check has the same purchasing power as in the last year. If there will be a hike in the Consumer Price Index for Urban Wage Earners and Clerical Workers to 0.1 percent or above every year between the 3rd quarter of the last year and the 3rd quarter of the recent year, then it will affect the check by increasing it to the same amount.
There has been a rise of 0.8% in COLA from the last year and it is the biggest since 2012 when Social Security benefits turned up to 3.6%. Being an average recipient of the Social Security, this 2.8% increase will be subject to only $39 for every month. And the average payout on the monthly basis will be increased from 1422 dollars in the last year to 1461 dollars in 2019.
The limit of earnings will increase
When you are going to collect the benefits of Social Security and if you are working at that time, then all or a part of the benefits will be withheld on a temporary basis, based on your earnings. But if we see the change in 2019, then the income limits will be extended slightly.
This update implies that before reaching the full retirement age, a person can earn up to 17640 dollars in 2019. Afterward, the amount of $1 will be subtracted from his or her payment for every 2 dollars that goes beyond the limit. According to the 2019 annual limit, there will be a $600 extension in the limit of the last year, i.e. 17040.
If a person reaches the full retirement age in 2019, then he or she can earn $46920. The Social Security benefits will be decreased by $1 per $3 earned over the limit of 2019, but there is a condition for this, which states that it will apply only to that money a person has earned in the months before entering the full retirement age. Once he or she reaches the full retirement age, no Social Security benefits will be suspended if people carry on working.
Must Read: Social Security Attorneys: The Importance, the SS Application Process, and the Benefits!
The disability thresholds will also rise
There are more than 10 million American people who apply for disability payments of Social Security and are eligible for it. This 2019’s update will also make the thresholds increased. People who are legally blind will get a maximum of 2040 dollars every month.
For non-blind persons, the higher Social Security benefit will rise by $40 to $1220 every month. These changes will start taking effect in January month in 2019. In addition, the COLA notice can be seen online without any hassle.
Final Verdict
Last but not least, Social Security changes in 2019 can be proven successful and great for the American people, if they completely realize them and start making the right strategies to claim their Social Security benefits. For more updates, you can go online and refer to the authorized website of the Social Security Administration.