U.S. Social Security Administration announces monthly Social Security and Supplemental Security Income (SSI) benefits will increase 2 percent in 2018.
How much COLA for 2018? The U.S. Cost of Living Adjustment (COLA) will be 2% in 2018.
Monthly Social Security and Supplemental Security Income (SSI) benefits for more than 66 million Americans will increase 2 percent in 2018, the Social Security Administration announced. The 2 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 61 million Social Security beneficiaries in January 2018. Increased payments to more than 8 million SSI beneficiaries will begin on December 29, 2017.
(Note: some people receive both Social Security and SSI benefits)
The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics. Some other adjustments that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $128,700 from $127,200. Of the estimated 175 million workers who will pay Social Security taxes in 2018, about 12 million will pay more because of the increase in the taxable maximum.
Based on the increase in the Consumer Price Index (CPI-W) from the third quarter of 2016 through the third quarter of 2017, Social Security and Supplemental Security Income (SSI) beneficiaries will receive a 2.0 percent COLA for 2018. Other important 2018 Social Security information is as follows:
|NOTE: The 7.65% tax rate is the combined rate for Social Security and Medicare. The Social Security portion (OASDI) is 6.20% on earnings up to the applicable taxable maximum amount (see below). The Medicare portion (HI) is 1.45% on all earnings. Also, as of January 2013, individuals with earned income of more than $200,000 ($250,000 for married couples filing jointly) pay an additional 0.9 percent in Medicare taxes. The tax rates shown above do not include the 0.9 percent.|
|Past COLA Rates|
July 1975 - 8.0%
January 1998 - 2.1%
|(1) The COLA for December 1999 was originally determined as 2.4 percent based on CPIs published by the Bureau of Labor Statistics. Pursuant to Public Law 106-554, however, this COLA is effectively now 2.5 percent.|
Information about Medicare changes for 2018, when announced, will be available at www.medicare.gov
The Social Security Act provides for how the COLA is calculated. To read more, please visit www.socialsecurity.gov/cola