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😁 8.7% Social Security Cost Of Living Increase!

(22 comments) Well it is "official" - I get $85 more in my Retirement Social Security Benefit payments.

 

Had gotten an email yesterday, just checked online.

 

I am assuming we get this starting in JANUARY 2023?

 

Social Security Site seems to say this month, DECEMBER 2022. πŸ€”

 

GRATEFUL!

 

Lol now to see how much my food bill INCREASES at Walmart. πŸ€£πŸ˜‚

 

Thanks,

Nicole πŸ™‚

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@OneStepAtATime I am providing a link to most of the January 2023 SS pay dates https://www.ssa.gov/pubs/EN-05-10031-2023.pdf For some folks, it appears the earliest pay date in January will be Tuesday January 3, 2023. However, most of us will receive the December 2022 SS payment which includes the revised COLA on the Second, Third, or Fourth Wednesdays in January 2023 (depends on your birthday). There is a small group of folks eligible for SSI (payable on the first of the month) who may have already received their check on either December 29th or December 30th due to the Holiday and Saturday non business day. Hope this helps all readers. Also, it may eliminate unnecessary phone calls to the SSA. Happy New Year!

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(1 comment) You are welcome @Tonster521 and lol, thank you for your "kind" responses. I have had to "not" ask some members questions AGAIN. You are ALWAYS "kind". πŸ™‚ Hate feeling I am bothering folks. πŸ˜‰

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@OneStepAtATime I understand the Online Community and its Forums are designed for  people to ask questions and exchange information. The Retirement and Social Security topics are complicated. I worked with both and will say that most available written information is "as clear as mud". Sometimes people read and reread and still ask questions. That is how I learned about these topics. it was also helpful working with these programs in real time for over 30 years So, I would continue with your approach. You are not bothering me. As you may already know, there are other folks in the Online Community that are very knowledgeable with these topics.

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2 comments (1/1/23) Hi @fffred , any tips on how an American would set up their account to receive their Retirement Social Security in a foreign country? No pressure to respond. Thanks, Nicole πŸ™‚

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@OneStepAtATime 

 

I assume you are pulling our collective legs but I will play along.  πŸ™‚

 

You need to set up a bank account in the foreign country. This may be a very difficult step unless you have residency in that country. But wait! There are the Cayman Islands, they take anyone. Once you have the bank account set up then you submit form SSA-1199 to the SSA. There are some few countries to which the SSA cannot make payments to, whether by direct deposit or check; though they do retain these funds and will pay you should you move residence out of such country at a later date (there are about 5 such countries, including North Korea, Iran, et al).

With your bank account and form SSA-1199 you will get your benefits in that foreign bank. 

 

But then there is the problem, or matter of, are you a resident of that foreign country? or are you still residing in the US? If the latter then you have to move your funds from The Caymans to your local bank in Kansas. This will cost some money that you pay to the foreign exchange company. Last I was there, Winn-Dixie nor Publix accepted Cayman Dollars, nor Philippine pesos (I have this connection through my wife's family), nor Canadian Dollars. On the other hand, there are so many Canadian snowbirds in Florida that it is possible that Publix may soon start accepting Canadian currency..

 

One thing about having your funds deposited in a bank outside of the US is that the IRS and Treasury will become very chummy with you. You will become good friends and there will be letters back and forth each year.

 

Ooops, I have to go out and shovel snow now!

Bronze Conversationalist

@fffred There is another issue, Federal Income Tax Withholding, that needs to be reviewed before one uses a foreign bank. I am not sure of the current rules with the SSA. However, if one receives a pension (and maybe an annuity) and that money is sent to another country that does not have a Tax Treaty with the USA, 30% must be automatically withheld for FIT. This may not be the person's actual tax bracket, but it ensures that the person will file a tax return to receive a refund, if any. If this is also the case with the SSA, 30% of 85% of the person's SS Benefit is withheld. This is 25.5% of the person's Gross SS Benefit. The IRS maintains the database of Tax Treaties. It is amazing which popular countries do not have Tax Treaties. I believe you are OK in Canada. Happy New Year! 

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1 comment (1/1/22) Hey @Tonster521 , I am "confused" as usual/lol πŸ€£πŸ˜‚

 

YOU STATED:

 

In fact, there are millions of folks that will not receive a net COLA increase amount to cover the Medicare Part B deduction because their SS gross benefit amount is less than $1,895.40 ($164.90 divided by .087).

 

MY QUESTION:

 

I get less than $1,895.40, not on Medicare yet, will be in a few months. And yes the $85 COLA increase will not cover the $164 Part B I will start getting "deducted" from my Retirement Social Security. 😭 Hmmm, are you saying IF I was getting more Social Security, my COLA would be more? Seems "unfair" as I have "less" to pay for Part B. 😀 Oh well, am I surprised? Nope!

 

Thanks,

Nicole πŸ™‚

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@OneStepAtATime The answer is Yes. COLA was increased 8.7% (.087) of your SS Benefit. So, if your SS Benefit is $1,895.40, your COLA increase is $164.90 which happens to be the Medicare Part B deduction for 2023. If your SS Benefit is $2,000, your COLA increase is $174.00 ($2,000 X .087) and so on. In my reply to @Jerseystorm, I used the Medicare Part B comparison since Jersey included that expense in  the initial posting. I try to keep it "apples to apples" and avoid confusion.

 

I agree that the COLA calculation is unfair. In fact, the folks with a greater SS Benefit receive a greater COLA even though they probably do not pay more for the items/expenses (i.e., food, gasoline, etc.) that are tracked/used to develop the cost of living increase from year to year, if any.  I read another posting wherein someone suggested that the COLA should be the same for everyone. There may be merit and value to this approach especially if it provides more SS Benefits for the lower paid SS Beneficiaries.

Thanks for your positive replies.

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(2 comments) So we start getting our BIG checks on Monday - 2023 has arrived! πŸ™„

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@OneStepAtATime I am providing a link to most of the January 2023 SS pay dates https://www.ssa.gov/pubs/EN-05-10031-2023.pdf For some folks, it appears the earliest pay date in January will be Tuesday January 3, 2023. However, most of us will receive the December 2022 SS payment which includes the revised COLA on the Second, Third, or Fourth Wednesdays in January 2023 (depends on your birthday). There is a small group of folks eligible for SSI (payable on the first of the month) who may have already received their check on either December 29th or December 30th due to the Holiday and Saturday non business day. Hope this helps all readers. Also, it may eliminate unnecessary phone calls to the SSA. Happy New Year!

Gold Conversationalist

@Tonster521 

 

I actually received my payment for December, 2022 deposited to my chequing account on December 30. Double-checking this now I see that the deposit is still there although it shows a date of January 3, 2023 (today being January 1).

Interesting because as a Canadian resident I get my SS retirement benefit on the third of each month. And because of changes in the US banking system a couple years ago some automated payments (not only SS) are actually credited to the recipient's account a few days early (my US company pension sees this as well, going into my US bank).

 

I recently began using the SSA's utility to directly deposit benefits into my foreign bank (in Canada) in Canadian currency. This seems to give very efficient exchange rates and no additional fees, as I might get through some other exchange mechanism.

This was also my first month's benefit after cancelling Medicare Part B so I am seeing a bigger boost in addition to the COLA. Also, due to the currency exchange rates the dollar amount (in Canadian dollars) "looks" a lot more than in US (about 1/3 more). My wife thinks this is great, but of course it is an illusion...I tell her that the "name" of the currency (dollars, yen, pesos, etc.) does not give a meaningful comparison when considering different countries of issue. ...meaning that just because the currency has the same name does not mean anything special.

Yes, indeed, if I ever move back to the US and want to re-up with Medicare Part B I will have to pay the 10% per year of absence surcharge on the premium. This is understandable and is not a concern for me.

Regular Contributor

I received the letter as well regarding the increase.  Since all SS payments are for the prior month, the increase for December 2022 will be received in January 2023.  Since I will be turning 65 next year, and will have to pay for Medicare Part B, my increase will amount to only $6.00 a month beginning in April.  On the bright side, it's $6.00 more than I had.  πŸ˜

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@Jerseystorm I understand the math regarding your new SS gross amount less the Medicare Part B deduction of $164.90 will leave  a small net increase of about $6.00. This gross to net calculation affects all SS beneficiaries who are eligible for Medicare Part B (less the folks that receive financial help with the Medicare Part B deduction - low income). In fact, there are millions of folks that will not receive a net COLA increase amount to cover the Medicare Part B deduction because their SS gross benefit amount is less than $1,895.40 ($164.90 divided by .087). They will see a net decrease. In addition to the above folks, the higher income folks that are subject to an Income Related Monthly Adjustment Amount (IRMAA) for Medicare Part B will see a decrease as well. So, a $6.00 increase is on the bright side. Hope this helps understand your COLA increase and future deduction for Medicare Part B. Happy New Year!

Honored Social Butterfly

You might try replacing your  current health insurance with regular  medicare and a F or G  plan  supplement.  Possibly a medicare advantage plan might be considered like Humana.It is worth seeing if you will save money.If you have regular health insurance ,you won`t be penalized if you switch now to all medicare  now.

Regular Contributor

Easyed598, I'm one of the lucky ones.  Upon retirement I received lifetime medical and prescription coverage at no cost to me.  My husband is also covered under my plan.  I gave up 4 years of raises to receive this.  When I turn 65 Medicare will become my primary and my current insurance will then become my secondary.  

Honored Social Butterfly

Wife gets $110.00/month more. Still haven`t got my notification but estimating around $200/month(less medicare premium on both).  

Honored Social Butterfly

Medicare premium pumped up to $164.90

Honored Social Butterfly

EDITED FOR CORRECTNESS 12/02/2023

When Will You See The COLA Increase -

If one is getting Social Security Retirement, Spousal or Survivors or Social Security Disability (SSDI) benefits, the COLA (8.7%) for 2023 increase will show up in your benefit paid in January 2023, regardless that these benefits are paid 1-month in arrears, the beneficiary will see it in the benefit auto-deposited in January on whatever their correct date for deposit (see the Calendar - link below).

Now if one gets Supplemental Security Income (SSI) which is only administered by the SS Administration also, but is NOT a Social Security benefit, it is paid and deposited for the same month and does not have any lag. Any COLA for SSI beneficiaries will be deposited or put on one's direct pay card on or around (due to holiday) 12/30/2022.

If you happen to be one that gets a mixed benefit of SSDI and SSI then you will see this COLA increase in your benefit deposited on January 03, 2023.

Here is the 2023 Calendar of deposits; note the footnotes if you don't know what benefit you are getting - NOTE: This is a pdf file or a download.

SSA.gov - Schedule of Social Security Benefit Payments 2023 Calendar

It's Always Something . . . . Roseanna Roseannadanna
Gold Conversationalist

errrr, yes'm, I am confused.

I am finally "on" SS old age (retirement) benefits and this is the first time I will experience a "COLA". I have read that the COLA takes effect in January and that the benefit payment is made in arrears (so January's benefit is paid in February, etc).

But this document from the SSA indicates the COLA takes effect with the December benefit, "Social Security benefits will increase by 8.7 percent beginning with the December 2022 benefits, which are payable in January 2023." (See under Latest Cola at this page https://www.ssa.gov/oact/cola/latestCOLA.html) That italicized phrase agrees with the COLA letter in my own My Social Security.

This SSA post says "The 8.7 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 65 million Social Security beneficiaries in January 2023. " (See https://www.ssa.gov/cola/).

My own recent COLA letter in My Social Security outlines my new benefit and that it is payable in January for the December, 2022 benefit.

I have been confused with references like this in the past to the SS COLAs. I think the confusion comes in because they aren't always precise with indicating if this is "benefit month" or "payment month".

So I think that the COLA will actually show up in payments for December, 2022 benefits as made in January, 2023 payments (and even as early as December 30, 2022 for some recipients, according to one page at the SSA).

(sorry for the lack of paragraphs. The AARP html overlord is giving me a very hard time about improper/invalid html.)


@GailL1wrote:

When Will You See Your Increase -

If one is getting Social Security Retirement, Spousal or Survivors or Social Security Disability (SSDI) benefits, the COLA (8.7%) for 2023 increase will show up in the benefit paid FOR January 2023 and since these benefits are paid 1-month in arrears, the beneficiary will see it in the benefit auto-deposited in February on whatever their correct date

Confused yet??? πŸ˜‹


Honored Social Butterfly

@fffred

My apologies - you are correct on the Social Security benefits COLA dates. I will try to edit my post on the SS COLA dates. I made the mistake because my personal balancing system always picks up the benefits deposited at the beginning of the following month -

As to your problem with the html - once you get the error notice - try hitting the "clear formatting editing tool - Ix - and then hit reply again and it should take.

Again - sorry - I am getting OLD. Thanks for correcting me - I always strive to give accurate info -

It's Always Something . . . . Roseanna Roseannadanna
Gold Conversationalist

@GailL1

It is understandable confusion. Even the SSA is not always clear in their documents (I was afraid that I had messed up my application for benefits at age "70" because the application was not clear on this "benefit month" vs "payment month" issue).

In any event, I am like only a young grasshopper in the light of the Master (you). Sometimes I read through older threads, in other AARP forums, and I am always struck by your wide field of (in-depth) knowledge about all these benefit/government/etc issues. You are such a valuable resource to the AARP forums!

Bronze Conversationalist

Thats a decent bump up. I heard January.

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