More than 22 million people receive Social Security benefits every year and the federal government pays almost Rs 64 million for this. Social Security benefits are of great help for the retired and disabled people. For many families in the USA. Social Security is the only source of income. As such any changes in the Social Security benefits affect them magnificently. But what can be done? Social Security changes per year. 2020 is no exception.
Social Security changes over the years. If you wish to get the maximum advantage, then it’s essential to know the Social Security benefits changes that are coming up in 2020. So let’s start right away.
There will be a 1.6% cost-of-living increase in terms of monthly checks from next year onwards. This means that a retired worker would receive $1503 every month instead of $1479. Couples who receive 2 benefit checks will receive $2531 per month.
Those who receive benefits based on a family member’s work record, they will also be happy in 2020. They will get more money every month. Widows with 2 kids will receive $2394 every month, which is $46 more than what they used to get previously.
A normal disabled worker will get $1258 per month, which is again $20 more than what he used to get previously. Surviving spouses will receive $1422 per month, which is $22 higher than what they used to receive every month.
Are you set to retire in 2020? Well, in that case, there is good news for you. If you’re eligible for the maximum benefit, then you’ll get more money than those who retired in 2019. If you continue working until your full retirement age before receiving benefits, then the maximum amount you can get is $3011, and that is $150 up from the previous year limit.
Here is the complete breakdown of how much retirees will get from 2020.
|Social Security benefits||2019||2020|
|Retiring at 62 years||$2209||$2265|
|Retiring at 65 years||$2757||$2857|
|Retiring at 70 years||$3770||$3790|
The main source of income for Social Security is the payroll tax, and that will increase in 2020. Those who belong to the high-income bracket have to pay a $12.4% tax in 2020.
The basic difference between 2019 and 2020 payroll tax can be understood from the table quite well.
|2019||Earned income above $132,900||Exempt|
|2020||Earned income above $137,900||Taxable|
In 2020, wealthy people have to pay an extra $4800 for payroll tax.
Amongst the various Social Security changes proposed, one of the most crucial ones is that early retirees will have a higher full retirement age in 2020. People who turn 62 years in 2020, will have a higher retirement age than those who turned 62 in 2019.
If your dad was born in 1958, then his full retirement age will be 66 years and 8 months. This is 2 months older than those who were born in 1957 and reached the age of 62 in 2019. Due to these kinds of Social Security changes to a federal benefit payment, 62-year-old workers will have a 28.33% reduction in their monthly payment in comparison to what they used to receive at their full retirement age. It’s 0.83% more reduction than what is given to 2019’s 62-year-old people.
Social Security benefits are not just for retired workers. These are also meant to help disabled people every month. Social Security benefits provide income to 10 million people each month, out of which there are 8.4 million long-term disabled workers.
In 2020, non-blind disabled beneficiaries will be able to earn up to $1260 per month before benefits cease. It’s $40 per month higher than what they get in 2019. Again, blind disabled recipients may earn up to $2110 every month, up by $70 from 2019. The benefits won’t stop in the next year.
Social Security changes to federal benefits will make most people happy. The new changes are likely to boost the retirement income of many people in the country. All that people need to do is know how to maximize Social Security benefits and have mental peace at the same time.