Acting Social Security Commissioner Larry G. Massanari said the increase, which will affect 50 million people, is tied to changes in the Consumer Price Index (CPI). The CPI is one of the government’s chief measures of inflation
The figure announced Friday lags the 3.5 percent hike that recipients started getting in January.
For Social Security beneficiaries, the average monthly benefit amount for all retired workers will rise from $852 to $874. The maximum federal SSI monthly payment to an individual will rise from $531 to $545. For a couple, the maximum federal SSI payment will rise from $796 to $817.
Lower energy prices have helped inflation remain tame this year. In the first eight months of this year, consumer prices moved up at an annual 2.5% rate. That compared with 3.4% for all of 2000.
Some other changes that take affect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will jump to $84,900 from $80,400 in 2002