What Is 2017’s Cost of Living Adjustment (COLA)?
On October 18, the Social Security Administration announced a 0.3% COLA for the year 2017.
In terms of benefits, that means:
-An average Title II disabled worker’s benefits will increase $4 per month from the current $1166.46.
-Supplemental Security Income (SSI) will increase to $735 for individuals (up from $733), and $1103 for couples (up from $1100).
The COLA is based on the price of a basket of goods as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). A low rate of inflation for that basket in 2016 translates to a low COLA for 2017.
Automatic COLAs took effect in 1975, and since then, there have been three years with no COLA: 2010, 2011, and 2016. The highest ever COLA increase was 14.3% in 1980, and the lowest is 2017’s 0.3%.
The coming year will also usher in a number of other noteworthy changes for disability beneficiaries:
-The Substantial Gainful Activity (SGA) threshold will increase to $1170 per month (up from $1130); for those who are blind, it will increase to $1950 per month (up from $1820).
-The Trial Work Period level will increase to $840 per month (up from $810).
-The taxable maximum (earnings above which are exempt from Social Security taxes) will increase from $118,500 to $127,200.
The SSA reports that around 173 million people will pay Social Security taxes in 2017. About 12 million of these people will be affected by the increase in the taxable maximum.