Five Noteworthy Changes for Social Security in 2015

For many Americans, Social Security is a lifeline that they depend on year after year. Although it experiences a number of changes each year, most of them are for the better. This year’s changes to Social Security aren’t any different: we’re seeing cost of living increases, a change in the way statements are handled and other pieces of good news for anyone who is planning to include Social Security as part of their retirement package. Look for these changes to Social Security in 2015:

Increased taxable income cap. You probably know that only a portion of earned incomes are actually taxed under the Social Security program. In 2014, the cut-off was at $117,000 — meaning that anyone earning more than this amount would not be allowed to pay extra into the system. In 2015, that cap has been increased to $118,500. This change is estimated to only affect about six percent of workers, but for them it will have long term benefits in the form of a bigger Social Security benefit at retirement.

Larger full retirement benefit maximum. Just how much you can draw from Social Security is determined by how much you pay in and the age at which you retire. For 2015, the max benefit for workers retiring at age 66 is $2,663 monthly, or $31,956 yearly — up from $2,642 monthly in 2014. If you’re planning for a 30 year retirement, that’s an extra $7,560 if your benefits consistently bump the cap.

Higher earning limits for recipients. If you have or plan to claim early benefits and continue to work, there’s good news — your earning limit has been increased! People under age 66 and collecting Social Security can now earn up to $15,720 before it affects their benefits. Anyone still working who will turn 66 this year can earn up to $41,880 in 2015.

Cost of Living Adjustment. The Social Security Administration included a 1.7 percent cost of living adjustment this year, so if your check seems a little bigger than usual — it is. The typical retiree should expect to see about $22 a month if they’re single; retired couples who are both receiving benefits will average about $36 extra dollars each month. It may not seem like a lot, but with the still-sluggish economy, many people were surprised that Social Security included a COLA at all for 2015.

The return of paper statements. Paper statements were discontinued in 2011, but have returned this year for workers who will turn 25, 30, 35, 40, 45, 50, 55, 60 in 2015. Expect a statement to arrive about 3 months before your birthday.  It’ll include all the vitals of years past, including your payments to date and your projected benefit. You’ll have the option to sign-up for the mySocialSecurity site at http://www.socialsecurity.gov/myaccount for more up-to-date information on your benefits, as well.

The changes for Social Security in 2015 aren’t Earth-shattering, but if you’re considering using these benefits as part of your retirement plan or are already taking advantage of them, you’ll agree that slow and steady is completely acceptable. Small changes can make a huge difference to your retirement account down the line, so it’s important to keep an eye on Social Security news year after year.

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