2024 Social Security
Find out how your benefits will change in the upcoming new year.
1. Average Retirement Benefits
An 3.2% cost of living increase for Social Security retirement benefits and SSI payments begins with December 2023 benefits (payable in January 2024).
Starting January 2024
Average Benefits – All Workers:
- 2024: $1,907/mo (+$80)
- 2023: $1,827/mo
Maximum Benefits for Workers Retiring at Full Retirement Age:
- 2024: $3,822/mo (+$195)
- 2023: $3,627/mo
Tip: Increase your Social Security retirement benefits by 5-8% per year when you delay applying until you’re age 70.
2. Social Security Revenues & Expenditures
Revenue Sources = $1.22 trillion
- 3.9% – Taxation of benefits
- 5.4% – Interest
- 90.7% – Payroll taxes
Expenditures = $1.24 trillion
- 0.6% – Administrative expenses
- 0.4% – Railroad Retirement financial interchange
- 99.0% – Benefit payments
3. 2024 Social Security & Medicare Tax Rates
The below tax rates are a combination of 6.2% for Social Security and 1.45% for Medicare. There is also a 0.9% Medicare wages surtax for those with wages above $200,000 single ($250,000 joint filers) that is not reflected in these figures.
If you work for someone else, your employer pays 7.65% in taxes.
If you work for someone else, you pay 7.65% in taxes.
If you’re self-employed, you pay 15.3% in taxes.
|Maximum amount you may pay in Social Security taxes:||$10,453.20||$9,932.40||+$520.80|
|Maximum earnings amount Social Security will tax at 6.2%:||$168,600.00||$160,200.00||+$8,400.00|
Social Security Facts:
- 182+ million people work and pay Social Security taxes
- Social Security has provided financial protection for Americans since 1935
Social Security Payments Explained:
- Social Security (SS) retirement benefits are for people who have paid into the Social Security system through taxable income.
- Social Security Disability (SSD or SSDI) benefits are for people who have disabilities but have paid into the Social Security the system through taxable income.
- Supplemental Security Income (SSI) benefits are for adults and children who have disabilities, plus limited income and resources.
Maximum SSI Payments:
How does Social Security work?
- When you work, you pay taxes into Social Security.
- The Social Security Administration uses your tax money to pay benefits to people right now.
- Any unused money goes into Social Security trust funds and is borrowed by the government to pay for other programs.
- Once you retire, you receive benefits.
How to qualify for retirement benefits:
When you work and pay Social Security taxes, you earn credits toward benefits. The number of credits you need to earn to receive benefits depends on when you were born.
- If you were born in 1929 or later, you need 40 credits (10 years of work) to receive retirement benefits.
- You receive one credit for each $1,730 of earnings in 2024.
- You can receive 4 credits maximum per year.
Did you know you can check your benefits status before you retire?
- You can check online by creating a my Social Security account on the SSA website. If you don’t have an account, you’ll be mailed a paper Social Security statement 3 months before your 61st birthday.
- This statement shows your year-by-year earnings. It also estimates the retirement, survivors and disability benefits you and your family may be able to receive now and in the future.
- If it doesn’t show earnings from a state or local government employer, contact them. The work may not be covered within Social Security.
Questions about Social Security and the 2024 benefit changes? We are more than happy to answer any questions at dpcpa.com/contact.