From various news sources
COLA increase =$22
The U.S. government will raise benefits for Social Security beneficiaries by 1.7% in 2015, the Social Security Administration said today. This is the third consecutive year in which the increase will be under 2%.
The agency said it expects to send out checks to about 64 million people next year, most of whom are pensioners. The average monthly payment to a retired worker will increase by $22 to $1,328. Social Security benefits are also given to disabled workers, spouses and children, with the overall average monthly payment remaining around $1,192. The 1.7% increase means the average retired couple will get a $36 increase to $2,176.
The annual cost-of-living adjustment (COLA) affects payments to over 70 million federal, postal retirees, disabled veterans and Social Security recipients, or about one fifth of the country.
For the second year in a row, Medicare Part B premiums, which are withheld from retirees’ Social Security benefits, will remain unchanged at $104.90 a month per person. Additional Medicare Part B premiums charged to higher income seniors will also remain unchanged.
Retiree COLAs-The 2015 COLAs for CSRS and FERS benefits are based on the increase in the average CPI-W between the 3rd quarter of 2013 (230.327) and the 3rd quarter of 2014. The 3rd quarter of 2014 average CPI-W was calculated today at 234.242, so the 2015 retiree COLAs will be 1.7%. CSRS annuities receive full COLAs; COLAs for FERS annuities are payable for retirees 62 and older and may be reduced by up to one percentage point from the increase in the CPI. The COLAs will be included in CSRS and FERS payments starting in January 2015. NALC
COLA Announcement Renews Need for New Inflation Formula
National Active and Retired Federal Employees Association
Alexandria, VA – Following the Bureau of Labor Statistics announcement of a 1.7 percent cost-of-living adjustment (COLA) for 2015, Joseph A. Beaudoin, president of the National Active and Retired Federal Employees Association (NARFE), released the following statement on the impact to federal civilian retirement annuities and Social Security benefits:
“News of the cost-of-living adjustment (COLA) for the coming year always is eagerly awaited by the countless Americans who rely on the increase to keep up with the rising price of food, housing, transportation and medical care. However, despite the partial relief this 1.7 percent COLA will provide, the announcement is a reminder that our method for calculating the increasing cost of goods and services is out of sync with the reality faced by millions of federal annuitants, Social Security recipients and military retirees, who spend more than twice as much on medical care than the population measured by the current CPI-W formula.
“The average 3.8 percent increase in health care premiums for federal employees and retirees in 2015 shows that medical costs continue to outpace the COLA as it is calculated presently. We need a cost-of-living formula that doesn’t force these Americans to take one step forward, then two steps back.
“As members of Congress and the President develop their budget proposals for fiscal year 2016, I urge them to include a switch to the CPI-E formula, a more accurate measure of inflation that accounts for health care and other costs facing seniors.
“Conversely, they should reject previous proposals to switch to the Chained CPI, which would only make a bad situation worse by further decreasing the hard-earned benefits of Social Security recipients and federal retirees, while increasing taxes on lower- and middle-income taxpayers.”
Press Release from Social Security Administration
Monthly Social Security and Supplemental Security Income (SSI) benefits for nearly 64 million Americans will increase 1.7 percent in 2015, the Social Security Administration announced today.
The 1.7 percent cost-of-living adjustment (COLA) will begin with benefits that more than 58 million Social Security beneficiaries receive in January 2015. Increased payments to more than 8 million SSI beneficiaries will begin on December 31, 2014. The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics.
Some other changes that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $118,500 from $117,000. Of the estimated 168 million workers who will pay Social Security taxes in 2015, about 10 million will pay higher taxes because of the increase in the taxable maximum.
Information about Medicare changes for 2015 is available at www.Medicare.gov.
The Social Security Act provides for how the COLA is calculated. To read more, please visit www.socialsecurity.gov/cola.