Social Security to See Significant Adjustment for 2023

Your 2023 Social Security Benefits

Find out how your benefits have changed

Average Retirement Benefits

Starting January 2023

• All workers in 2022: $1,681/mo

• All workers in 2023: $1,827/mo (+$146)

• The 2023 maximum Social Security retirement benefits for a worker retiring at full retirement age: $3,627/mo

An 8.7% cost of living increase for Social Security retirement benefits and SSI payments begins with December 2022 benefits (payable in January 2023).

Increase your Social Security retirement benefits by 5 to 8% per year when you delay applying until you’re age 70.

Social Security Revenues & Expenditures

Revenue Sources = $1.09 trillion

• 3.5% - Taxation of benefits

• 6.4% - Interest

• 90.1% - Payroll taxes

Expenditures = $1.14 trillion

• 0.6% - Administrative expenses

• 0.4% - Railroad Retirement financial interchange

• 99.0% - Benefit payments

SOURCE: 2022 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Disability Insurance Trust Funds, Table Il.B1.

2023 Social Security & Medicare Tax Rates

If you work for someone else...

• Your employer pays 7.65%

• You pay 7.65%

If you’re self-employed...

• You pay 15.3%

NOTE: The above 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.

Item: Maximum amount you may pay in Social Security taxes

2023: $9,932.40

2022: $9,114.00

Change: + $818.40

Item: Maximum earnings amount Social Security will tax at 6.2%

2023: $160,200.00

2022: $147,000.00

Change: + $13,200.00

• 165+ 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

Filing Status 2023 2022 Change

Individual $914/mo $841/mo + $73

Couple $1,371/mo $1,261/mo + $110

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.

• Later on when you retire, you receive benefits.

Here’s how you 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 retirement 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 $1,640 of earnings in 2023

• 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.

• It shows your year-by-year earnings, and estimates of 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.

Sources: SSA.gov