2020 Changes to Cost Of Living Adjustment
In October of every year the Social Security Administration announces a bunch of numbers that are determined by the rate of inflation over the prior 12 months. The most eagerly awaited number is the cost-of-living adjustment (COLA), or the amount by which Social Security checks will be raised.
The cost-of-living adjustment for 2020 was 1.6%. This means if your current benefit is $800, you’re getting an extra $12.80 a month. The higher your benefit is, the higher your COLA is. If your benefit is $3,300, which could happen if you are a maximum earner and you claimed your benefit at age 70, you’ll be getting a cost-of-living adjustment of over $52 per month.
But here’s the kicker: If you are enrolled in Medicare and having your Medicare premium taken out of your Social Security check, you may not see this much of an increase. Part of your COLA may be absorbed by Medicare premiums.