Changes to Social Security for 2018

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Thought we would take an article to share with our readers some of the changes that will affect Social Security in 2018.

COLA (Cost of Living Adjustment) – the 61 million Social Security beneficiaries will receive a 2 percent cost of living adjustment to their benefit amount. This will make the average monthly payment go up from $1,377 per month to $1,404 per month. Be aware that this COLA adjustment may not be seen in your payments because of the increases for some in the Medicare premiums. “About 70 percent of Social Security beneficiaries on Medicare will only see an increase of $2 in their monthly checks,” says Dan Adcock a policy expert at the National Committee to Preserve Social Security and Medicare (NCPSSM).

SHIFTING FULL RETIREMENT AGE – the full retirement age (FRA) will inch up again this year to 66 and 4 months for those born in 1956. This pattern will continue until it reaches age 67. By waiting until FRA, beneficiaries will ensure that they will get the full payout. Delaying beyond that has additional advantages including an increase of 8% annually to your check amount, improved Survivor benefit, utilization of claiming strategies to improve your income stream and others.

EARNINGS CAP – the amount of income subject to tax for the Social Security program will increase in 2018 to $128,400. Earnings beyond that are not subject to Social Security tax. This will result in an estimated 12 million people paying higher Social Security taxes.

HIGHER BENEFIT INCREASE – the maximum benefit will increase by 3.7 percent from $2,687 per month ($32,244 a year) to $2,788 per month ($33,456 a year). This maximum amount is based on your top 35 years of earnings and only a handful of people are eligible for this amount. The average benefit in 2018 is $16,848 for the year.

EARNINGS LIMITATIONS INCREASE – if you decide to draw your benefit prior to your full retirement age, your income per year has limitations. The increase in this amount will be to $17,040 in 2018. For every $2 you earn over this amount, Social Security will withhold $1 from your Social Security check. The year that you turn full retirement age, that limitation increases to $45,360 for that year only. At full retirement age and older, there is no restriction on income amounts.

Do yourself a favor in 2018 – plan ahead and have this benefit reviewed before filing. Your decision about filing is basically a permanent decision. We unfortunately see the sad faces of people that did not educate themselves to the options that are available before filing.

Pillars LLC is in the Corinth, MS area but service all 50 states. Roy and Diane are both National Social Security Advisors and Roy is a former CPA of over 40 years. You may contact them at, on their website at or call at 601-954-0699. KNOW before you GO!!