Many senior living residents may have a bit more money to spend next year. For that, they can thank a 2.8% cost-of-living adjustment to their Social Security benefits, starting in January.
The Social Security Administration announced the largest COLA increase since 2011 last week. For the average retired worker, that means the benefit will increase by $39 a month next year, to $1,461. For a retired couple, the amount will increase $67 per month, to $2,448.
“For more recent retirees, the 2019 [cost-of-living adjustment] will be the largest increase they have gotten to date,” said policy analyst Mary Johnson, a spokeswoman for the Senior Citizens League.
Many pro-senior organizations welcomed the increase. But they said it would be improved with the adoption of the Consumer Price Index for the Elderly, which they claim is based on retirees’ actual spending habits.
The government, however, also announced that the wage base— which is the maximum amount of earnings subject to Social Security tax — will go up by 3.5% to in 2019. Currently, the base is $128,400. For about 12 million high-earning workers, that will mean a higher tax bill.
Social Security is financed by a 12.4% wage tax. Workers and their employers each pay half of the amount.
