People who receive Social Security benefits will see a little more money in their monthly electronic payments starting in January. The Social Security Administration (SSA) announced that benefits payments will increase by 3.6 percent next year based on a cost of living adjustment.
The Social Security Administration (SSA) operates the federal government's retirement and disability benefits programs, which the SSA estimates serves 60 million Americans. The retirement program offers partial benefits to persons who retire at age 62 and full benefits to those who work until reaching full retirement age (which varies based on date of birth). The SSA also makes Supplemental Security Income (SSI) payments to adults and children who are disabled or blind and have limited income and resources. Social Security Disability Insurance (SSDI), on the other hand, is available to disabled persons, their spouses and children, regardless of income and resources, if the disabled person has made sufficient payments into the Social Security system.
The SSA generally calculates monthly benefits payments based on what it calls "average indexed monthly earnings," a method of summarizing up to 35 years of a worker's indexed earnings. The figure is often adjusted to reflect cost of living changes based on inflation. While the new adjustment is the first in three years, 2010 and 2011 were the first two years since 1975 in which the SSA did not adjust payments based on living costs. According to the Associated Press, monthly Social Security payments average $1,082, or about $13,000 a year.
The move is likely to draw fire from some politicians, including many seeking the Republican Presidential nomination, who have called for a Social Security overhaul, including an increase in the retirement age combined with cost of living adjustment cuts. The New York Times' Jackie Calmes reports that even President Obama supports "changing the formula for cost of living increases in Social Security to a less generous one."
Additionally, Congress is widening the base from which Social Security's programs draw their funds. The SSA announced that the maximum amount of earnings subject to the Social Security tax will increase to $110,100 from $106,800, beginning in 2012.
Social Security disability benefits are generally available to persons who are unable to work for a year or more due to a physical or mental impairment (or combination thereof). A person seeking benefits must file a claim with the SSA, starting what is often a timely and confusing process through which the SSA determines whether the applicant is indeed eligible for benefits. An experienced Social Security disability lawyer can play a vital role in the process by gathering the necessary information and documentation to prove the claim, completing the claim forms and submitting them on behalf of the claimant.
Unfortunately, the SSA initially denies the majority of disability benefits claims filed, including many with merit. A disability attorney can also assist the claimant by appealing this decision and representing the claimant at hearing before an SSA Administrative Law Judge, where the lawyer will argue on the claimant's behalf and cross examine witnesses.
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