2024 Social Security changes

2024 Social Security

Find out how your benefits have changed.

Average Retirement Benefits

Starting January 2024

Average Benefits — All Workers

• 2024: $1,907/mo (+$80)

• 2023: $1,827/mo

Maximum Benefits for Workers Retiring at Full Retirement Age

• 2024: $3,822/mo (+$195)

• 2023: $3,627/mo

An 3.2% cost of living increase for Social Security retirement benefits and SSI payments begins with December 2023 benefits (payable in January 2024).

Increase your Social Security retirement benefits by 5-8% per year when you delay applying until you’re age 70.

Social Security Revenues & Expenditures

Revenue Sources = $1.22 trillion

• 3.9% — Taxation of benefits

• 5.4% — Interest

• 90.7% — Payroll taxes

Expenditures = $1.24 trillion

• 0.6% — Administrative expenses

• 0.4% — Railroad Retirement financial interchange

• 99.0% — Benefit payments

SOURCE: 2023 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Disability Insurance Trust Funds, Table II.B1.

2024 Social Security & Medicare Tax Rates

If you work for someone else, your employer pays 7.65%

If you work for someone else, you pay 7.65%

If you’re self-employed, you pay 15.3%

NOTE: The above tax rates are a combination of 6.2% for Social Security and 1.45% for Medicare. There is also a 0.9% Medicare wages surtax for those with wages above $200,000 single ($250,000 joint filers) that is not reflected in these figures.

Item 2024 2023 Change

Max amount you may pay in SS taxes $10,453.20 $9,932.40 +$520.80

Max earnings amount SS will tax at 6.2% $168,600.00 $160,200.00 +$8,400.00

• 182+ million people work and pay Social Security taxes

• Social Security has provided financial protection for Americans since 1935

Social Security Payments Explained

• Social Security (SS) retirement benefits are for people who have paid into the Social Security system through taxable income.

• Social Security Disability (SSD or SSDI) benefits are for people who have disabilities but have paid into the Social Security the system through taxable income.

• Supplemental Security Income (SSI) benefits are for adults and children who have disabilities, plus limited income and resources.

Maximum SSI Payments

Filing Status 2024 2023 Change

Individual $943/mo $914/mo + $29

Couple $1,415/mo $1,371/mo + $44

How does Social Security work?

• When you work, you pay taxes into Social Security.

• The Social Security Administration uses your tax money to pay benefits to people right now.

• Any unused money goes into Social Security trust funds and is borrowed by the government to pay for other programs.

• Later on when you retire, you receive benefits.

How to qualify for retirement benefits

When you work and pay Social Security taxes, you earn credits toward benefits. The number of credits you need to earn retirement benefits depends on when you were born.

• If you were born in 1929 or later, you need 40 credits (10 years of work) to receive retirement benefits

• You receive one credit for each $1,730 of earnings in 2024

• 4 credits maximum per year

Did you know you can check your benefits status before you retire?

• You can check online by creating a my Social Security account on the SSA website. If you don’t have an account, you’ll be mailed a paper Social Security statement 3 months before your 61st birthday.

• It shows your year-by-year earnings, and estimates of retirement, survivors and disability benefits you and your family may be able to receive now and in the future.

• If it doesn’t show earnings from a state or local government employer, contact them. The work may not be covered within Social Security.

Sources: SSA.gov

One of my primary objectives is to help you achieve your financial goals through a holistic approach that is tax-efficient in my wealth management and tax resolution practice. For more information, visit www.fredtfoxiii.com.

Fred T. Fox III is a Lawton native who owns

his own business.