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Social Security Benefits to See a Modest Rise in 2024

As we look ahead to 2024, over 71 million Americans who depend on Social Security and Supplemental Security Income are set to receive a 3.2% increase in their benefits. This uplift, announced by the Social Security Administration, is designed to help retirees’ benefits keep pace with inflation. On average, this adjustment translates to an additional $50 in the monthly retirement benefits, bringing the average to about $1,907 per retiree.

While this increase marks a significant step for financial adjustments, it falls short of the 8.7% increase beneficiaries experienced this year, which was a response to soaring inflation rates. The rise in 2024 is closer to the average adjustments seen over the past two decades, which hovers around 2.6%.

However, the true impact on each retiree’s finances will also hinge on the upcoming announcement of the Medicare Part B premiums for 2024, which are typically deducted from Social Security payments.

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Despite the planned increase, the reality of inflation continues to pinch many retirees, making it clear that every dollar counts. The sentiment is echoed by AARP’s Chief Executive Jo Ann Jenkins, who acknowledges the ongoing financial pressures faced by older Americans. Advocates continue to push for a reevaluation of how cost-of-living adjustments are calculated, proposing the Consumer Price Index for the Elderly (CPI-E) as a potentially more accurate reflection of the financial challenges seniors face.

While the upcoming increase is welcomed by organizations like Justice in Aging, there’s recognition that it may not fully bridge the gap for those seniors living on the edge of poverty, who are still struggling to afford basic necessities like housing and healthcare.

This situation also brings to light a less discussed consequence of increased Social Security benefits: the potential for low-income beneficiaries to lose access to other essential assistance programs, or face higher taxes on their benefits, due to inflexible income thresholds.

In the midst of these challenges, Social Security remains a cornerstone of retirement income, though it’s often noted to be a modest one. Mary Johnson of The Senior Citizens League reminds us that Social Security was never designed to fully replace pre-retirement earnings, highlighting the need for a broader conversation about the support system for America’s seniors.