Social Security Cost-of-Living Adjustment for 2021

calculator with financial paperwork

Disclaimer: With Medicaid, VA, and insurance regulations frequently changing, past blog posts may not be presently accurate or relevant. Please contact our office for information on current planning strategies, tips, and how-to's.

Yesterday, the Social Security Administration announced the cost-of-living adjustment (COLA) for 2021. The increase will be 1.3%, which is in line with expectations based on consumer price index data. The 1.3% bump applies to about 70 million Americans who receive Social Security and Supplemental Security Income benefits.

In 2021, the estimated average monthly benefit will increase by $20 for retirees and by $16 for disabled workers. The maximum amount of wages taxed for Social Security will be boosted by about $5,000 next year.

The Social Security COLA for 2021 is a bit smaller compared to recent years. The increase was 1.6% for 2020 and 2.8% for 2019. In 2010, 2011, and 2016, however, the COLA was zero. Since 2010, the COLA has averaged a 1.4% increase per year.

Get the full Social Security 2021 Fact Sheet here.

Read the full article from CNBC.