These are the three main changes in Social Security for 2024
The Social Security Administration makes regular changes to the benefits system in the US. These are the most impactful for you in the coming year.
Social Security was first introduced in 1935 by President Roosevelt and it has become a key source of income for tens of millions of households every month.
The program is nearly 90 years old but is constantly evolving and there are a number of changes coming in 2024. All recipients will enjoy an increase on their monthly payments in the New Year, but the work credit requirement has been upped so it will be slightly harder to qualify in the future.
Here’s three key changes to Social Security in the coming year…
COLA increase will boost payments
The most publicised of the changes coming in January is the cost-of-living adjustment (COLA) increase. Every year the Social Security Administration (SSA) enacts a percentage increase on all monthly payments to ensure that they keep up with inflation.
Social Security recipients will receive an 3.2% COLA raise next year. This is significantly lower than the 8.7% increase for 2023.
Work credit requirements will be increased
Recipients of Social Security payments must have earned at least 40 work credits to be eligible, assuming they are not claiming on the work history of their spouse.
The maximum amount you can earn in a year is four credits, but you have to have made a certain amount of money to do so. In 2023 that figure was $1,640, but in 2024 that will rise $1,730 per credit . For low earners or part-time workers, that could mean that you won’t receive the full four credits next year.
An increasing retirement age
Annually, the Full Retirement Age increases by two months. Consequently, individuals born in the first three months of 1958 will exclusively meet the eligibility criteria for Full Retirement Age in 2024, set at 66 years and 8 months for this specific birth year. This incremental pattern culminates in a Full Retirement Age of 67 for individuals born in 1960 and beyond.
Those that aren’t quite ready to retire can increase their maximum Social Security benefits if they keep working until they are 70.