$2,400 increase could be on the way

The news of the lack of Social Security trust funds is nothing new. The trustees announced during these last few months that by the year 2035 there would be economic problems for retired citizens of the United States. These financial problems mean a 20% drop in total benefits. Therefore, it is not the best time for Social Security and its economic stability.

However, it is possible that this reduction will not happen. Social Security would have some changes that will reduce this problem. It is still too early to be afraid of a reduction, but we must pay attention. Among the proposed changes to Social Security fundraising, one of them may be an increase of $2,400 per year.

Is a Social Security increase possible?

Yes, it is possible. What’s more, every year there is a Social Security increase through the COLA. With the COLA, American citizens receive a larger amount of money in their Social Security checks. This change is made every year, so every year the benefits increase. It should be noted that this change is made so that pensioners do not lose purchasing power.

The increase we are talking about is $2,400 per year. This means that Social Security pensioners would receive $200 more per month. Thanks to this bill pension payments would be higher. This Bill would increase taxes for all people earning a high salary. Therefore, this bill would only affect a very few people, although it would benefit many more.

That said, it is important to think of all the benefits that this increase in Social Security can bring. Although the ultimate idea is that pensioners do not lose purchasing power, any increase in pensions is welcome. It will probably not be enough because of the current inflation, but it will help to alleviate the situation a little.

Does the COLA also apply?

Another important question people might ask if this Bill turned out well is about COLA. If with that $ 200 per month increase, retirees could have more money per month, would the COLA apply? Being separate things, the two concepts are compatible. The cost of living adjustment takes place every year without taking into account the rest of any increases.

But we have to be very careful with this information. There is still nothing real that could reassure us that we will have a $ 2,400 per year Social Security pension increase. This increase is a guess, but if we look at the data it will be possible. The only option left for now is to wait for the last word of the US government and Congress.

The Social Security COLA will be announced in October, so the increase for next year’s retirement 2023 could be doubled. Anyway, there is nothing final yet and we have to wait. It is better to be patient and increase your savings just in case.