WASHINGTON (CBSNewYork/AP) — Millions of Social Security recipients and federal retirees will get a monthly increase in benefits of just 0.3 percent in 2017.
There was no increase this year. Next year’s benefit hike will be small because inflation is low, driven in part by lower fuel prices.
The federal government announced the cost-of-living adjustment, or COLA, Tuesday morning. According to the Social Security Administration, cost-of-living adjustments are tied to the Consumer Price Index, which is set by the Bureau of Labor Statistics.
The taxable maximum amount of earnings subject to Social Security tax will also increase from $118,500 to $127,20 at the start of 2017. According to the Social Security Administration, this increase will impact around 12 million of the 173 million estimated workers who pay the tax.
The average monthly Social Security payment is $1,238. That translates into a monthly increase of less than $4 a month.
The increase will take effect on Dec. 30, 2016.
The COLA affects more than 70 million people — about 1 in 5 Americans.
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