Every year, the Social Security Administration (SSA) administers a regular increase in Social Security payments due to the Cost of Living Adjustment (COLA). These payments, which span a diverse pool of beneficiaries encompassing retirees and those with disabilities, are based on inflation rates and hinge on changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
The age at which Social Security retirement beneficiaries begin receiving benefits influences the amount they receive. However, the calculation differs for Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) recipients, being primarily based on their capacity to work.
Certain factors may also decrease a recipient’s Social Security benefits, such as receiving other government benefits, working while collecting benefits, or residing outside the United States for an extended duration.
Payments are distributed based on birthdates; those born between the 1st and 10th, 11th and 20th, and 21st and 31st of the month receive their payments on the second, third, and final Wednesday of each month, respectively.
However, payments come earlier in the month for recipients who retired before 1997 or are SSI beneficiaries.
Deciphering Social Security payment dynamics
In cases where a person qualifies for both SSI and regular Social Security benefits, the SSI payment arrives at the beginning of the month, followed by the regular benefit within three days.
The SSA makes necessary adjustments in the payment schedule when standard dates coincide with public holidays or weekends, thus ensuring people dependent on these benefits do not experience undesirable interruptions.
Payment amounts vary based on individual circumstances. The SSA approximates that the average payment for retired employees is around $1,907, with figures altering based on factors such as the beneficiary’s lifetime earnings and marital status.
COLA plays a crucial role in mitigating the effects of inflation, facilitating annual increases in Social Security payments. The intent of this annual raise is to counterbalance the rising costs of fundamental services and goods, consequently preserving the real value of Social Security benefits over time despite potential inflation.
