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Social Security rising 1.5%

By Jennie L. Phipps · Bankrate.com
Wednesday, October 30, 2013
Posted: 3 pm ET

Social Security confirmed today that the average cost of living adjustment, or COLA, will be 1.5 percent in 2014 -- one of the lowest increases since the program was first adjusted for inflation in 1975.

To put this in perspective: In 1987 and 1999, the COLA was only 1.3 percent. There was no adjustment in either 2010 or 2011. The largest adjustment was in July 1980, when inflation drove up benefits 14.3 percent.

The average Social Security payment for an individual will rise $19 a month from $1,275 to $1,294. The average couple will get $31 more, their benefit rising from $2,080 to $2,111.

In some years, the Social Security increase brought about by the COLA was eaten up by an increase in Medicare Part B, which automatically is subtracted from most people's Social Security payments. In 2014, Medicare Part B, which covers doctor's office visits, won't rise from its current level of $104.90. That's good retirement planning news.

If you are strictly on the paying end of this and not yet ready for retirement, maximum taxable earnings on which Social Security payroll taxes are levied will rise in 2014 to $117,000, up from $113,700 in 2013. To qualify for Social Security, you must work a total of 40 quarters, earning at least $1,200 a quarter in 2014, up from $1,160 in 2013.

If you are between 62 and full retirement age -- 66 for people turning 62 in 2014 -- and you continue to work while claiming, you will have to pay back a portion of your Social Security payments if you earn more than $15,480 in 2014. That's up from $15,120 a year in 2013. The year that you reach full retirement age, you can earn as much as $41,400 without penalty, an increase of $1,320 from 2013.

The COLA also affects benefits for federal government retirees, disabled veterans and people who get Supplemental Security Income, the disability program for the poor.

Opposition to proposed COLA changes

Many organizations supporting improvements to Social Security are using today's announcement as an opportunity to explain why they think this year's COLA is unfair to middle-income people who are dependent on the program. They are particularly opposed to proposals to adopt the Chained Consumer Price Index, or Chained CPI, which would further reduce Social Security COLAs. A poll released by Democracy for America says that people across the political spectrum reject the Chained CPI, with 74 percent opposing it in red states like Kentucky; 64 percent against it in blue states like Hawaii; and 70 percent opposing it in swing or purple states like Iowa.

Another survey by the Senior Citizens League says that more than 78 percent of people older than 65 either favor, or somewhat favor, requiring workers with incomes higher than $117,000 in 2014 to pay Social Security taxes on all of their wages. If that were the case -- and people making more than $117,000 received no additional benefit from their additional taxes, the Social Security's Office of the Chief Actuary says the deficit would disappear. If there were no maximum earnings cap and additional benefits were paid to high earners, about 43 percent of the shortfall would be eliminated.

If we raised the cap on Social Security taxable income, how much -- if any -- additional Social Security benefits should be allocated to people who earn more than $117,000 a year? Or should this be a straight tax increase with no benefit increase to high earners?

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102 Comments
Ray Thomas
November 07, 2013 at 12:53 pm

Put our elected officals on social security and medicare like the rest of us and then we will have more money to spend elsewhere. also if obomacare is suppose to be good enough for us
why isn't it good enough for our elected officials? They need to overhaul social security and put it in an account for the person who is paying it in and to where it can't be touched by the government and let it draw interest until the person retires,
then pay the rest that is left to their family where it should go
because they are the ones who paid it in to start with. We also need to start drug testing all people who receive SSI. Thanks for letting me comment on this subject just take it to heart and listen to what the American people are sayingand don't try and be dictators.

damita
November 07, 2013 at 12:53 pm

THERE IS NO WAY WE ARE GOING TO BE ABLE TO LIVE OFF THESE FEW DOLLARS THEY GIVING US NEXT YEAR. HELL! THEY TAKE IT RIGHT BACK WITH DOCTER COPAYS AND MEDICINE. I FEEL LIKE THAT 104.00 THE TAKE OUT FOR PART B SHOULD TAKE CARE OF COPAYS ALSO. NO ONE GOES TO THE DOCTER EVERY MONTH. ADD UP THAT TIMES 12 MONTHS THAT IS ALOT OF MONEY BEING TAKING FROM US.

Frances Bellgardt
November 07, 2013 at 12:25 pm

I agree with Betty Gearhart. Also they have raised our supplement insurance plus our part D.

Charlene
November 07, 2013 at 12:05 pm

I am just surprise its so easy for people to blame P Obama for all the problems in government when the same old trouble makers were in the government long before he came maybe that's why we have problems get rid of those old southern trouble makers for good and for the country,there was never just one race that built this country.

An American who Care’s
November 07, 2013 at 11:32 am

I have been on SSD for some yr's now due to health issues and I get a little over $800.00 a month and they say when the expense for living go's up they give you more money,which people who live off the money know it's no help,,(that's what they call it)The one's who sit up there in office have no clue, they could never live off what they give us,You pay your bill's and there's nothing to live off the rest of the month,if they was really giving you money to live, then it would be at least $1500.00 a month.When you pay rent,gas&elec,food,med,and so forth,how do they think anyone could live off such small amounts.They know,but they turn a blind eye and make it the peoples falt and you have to find a way to make ends meet and if you do things that breake the law then your wrong,but what chose do they give,Don't get me wrong, Thank god I get what I do,cause I would be another person homeless and jobless and if you die off your just one less person they( The Government) has to worrie about.The Government really need's to worrie about the well being of the people,Cause with out us there is no WORLD!!!!!!!!!!!!

Tony Orti
November 07, 2013 at 11:29 am

The Goverment as wasted Trillions of Dollars on Black Ops Projects Money that is never accounted for these projects are the ones that has caused the deficit in 2001 the Government could not account for 3.2 Trillion Dollars and this stated by Donald Rumsfeld. Read and Weep my Friends

Randy Atkins
November 07, 2013 at 10:54 am

yes the Soc Sec system is going broke because our elected officials keep taking that money and spending it on other things..that money was meant to sit there and draw interest for retirees...if that would have been done there would be more than enough money to pay Soc Sec benefits...all of these idiots need to be voted out of office and get people in office who will do the right thing by seniors...the ones like me, who have been working since they were 15 or 16 y.o. and have been putting money into the system for over 50 yrs.

charity schlosser-ashworth
November 07, 2013 at 10:53 am

I respect everyones opinion we all have the freedom to speak what our feelings are. I live my life by honesty and Integrity, therefore, I feel 1.5% is a Total waste of time put it towards a bigger problem, where the money will do more to help out our current situation, get the mucky mucks out of office, and off their golf courses and yachts, tax the hell out of Alcohol, and pay off the nastional Deficit. Remember (K>I>S>S)(keep it simple stupid ). We forgot that chlique. Getting President Ohbama to step down, at this point would possibly be in our best
intrest. Sincerely Charity Schlosser-Ashworth

SunshineladyIL
November 07, 2013 at 10:47 am

Sorry folks about the typo...
A little bit of something is better than a whole lot of nothing

Betty Gearhart
November 07, 2013 at 10:44 am

They never tell you about the numbers of people who don't come anywhere close to the $1200.00 check that a lot of SS goes to. But my check, and a lot of others I know, is not even half of that figure.
When they cut the COLA that much and then raise Medicare payments there are times I end up with as little as $2.00 increase.
That does not help much at the grocery store or at the gas pump.
Not complaining, just stating a fact.

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