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Expect A Slight Boost In Social Security

If you’re one of the more than 56 million people receiving Social Security, you’ll see a slight boost in your monthly benefits come January.

But the 1.7% cost-of-living increase for 2013 announced this week by the Social Security Administration is still the sixth-lowest increase since the SSA began making annual automatic adjustments in 1975.

And some of that increase is expected to be eaten up by higher Medicare premiums.

If you’re wondering what you’ll see in your check, it will equal a $21-a-month boost for the average retired worker, according to the SSA. Average monthly benefits will increase from $1,240 to $1,261.

The increase applies to the more than 8 million Supplemental Security Income beneficiaries. They’ll begin seeing their increase on Dec. 31.

The annual COLA change is based on the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers, according to the SSA website.

The COLA adjusts Social Security and SSI benefits to this measure of inflation.

The maximum taxable earnings will also increase in 2013, to $113,700 from $110,100. The SSA estimates that of the 163 million workers who will pay Social Security taxes in 2013, nearly 10 million will pay higher taxes due to this increase.

That increase falls on top of an expiring tax break that cut employee contributions to Social Security by two percentage points.

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