The rumored fourth stimulus check is nowhere to be seen, but with the COVID-19 pandemic still not over, a surprise payment boost starting next month could offer some relief to millions of Americans. These surprise coronavirus stimulus checks are the result of a new cost-of-living adjustment (COLA). Specifically, this new COLA will ensure bigger Social Security checks for millions of Americans.
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More than 64 million Americans will directly benefit from the new adjustment as their Social Security checks are set to increase to about $1,600 per month. The Social Security checks will increase by 5.9% due to the cost-of-living adjustment, the highest since 1982.
In October, retired workers received about $1,562.66 on average, but starting next month, this payment will increase to an average of $1,654.65 following the COLA. On average, the Social Security checks are estimated to increase by $92 starting in January.
Aside from the Social Security checks, those receiving Supplemental Security Income (SSI) will also see an increase in their monthly checks. On average, the payments will increase by $34 to $621 in January, compared to an average of $587 earlier.
Even though the 2022 COLA-related hike is big, many beneficiaries are unlikely to see the full increase in their checks. This is because of the Medicare Part B premiums, which are subtracted directly from the Social Security retirement payments.
COLA Not Enough
Partly due to inflation, the premium for Medicare Part B increased to $170.10 for 2022. It was $148.50 in 2021. This jump in the Medicare Part B premium will offset the increase in the check amount (due to the COLA).
For instance, suppose an individual is set to receive a monthly benefit of $1,657 in 2022, up from $1,565 in 2021. After the Part B deduction of $170, their net check amount is just $1,487.
Thus, recipients with the smallest Social Security benefit will be hit the hardest because of the increase in Medicare. The Social Security COLA payments have increased by over 18% from 2013 through 2022. On the other hand, Part B premiums have jumped by over 57% during the same period, according to the Senior Citizens League, a nonpartisan advocacy group.
This is one primary reason why repeated requests are being made to President Joe Biden to provide an additional stimulus check to seniors. For instance, in a letter to Congress, the Senior Citizens League requested a one-time $1,400 Social Security stimulus payment for seniors.
A point to note is that the advocacy group started its campaign for additional stimulus check even before the announcement of the 5.9% cost-of-living adjustment. Still, the advocacy group argues that the adjustment is not enough and continues to push Congress to issue more stimulus money to the elderly.