Social Security changes in 2024: What you need to know
(CNN, KYMA/KECY) - Managing finances can be especially challenging for retirees or people who plan to retire soon, but there will be changes to Social Security payments and Medicare this year, and AARP experts share advice about how to adjust people's outlook.
U.S. inflation continued to decline in 2023, and the financial picture for Americans, including retirees, is improving.
For that reason, monthly Social Security payments will only rise by 3.2% this year based on the cost of living adjustment.
AARP Senior Vice President Bill Sweeney says the boost is a bit disappointing in contrast to 2022's 8.7% increase, a 40-year-high.
"This is probably not enough for them to, to, to be able to feel comfortable and confident about their savings," Sweeney added.
Concerns and bright sides
Another concern: Standard premiums for Medicare Part B are back on the rise. The portion of medicare that covers doctor visits and other outpatient treatment is up 6%.
On the bright side, people who haven't retired yet can now sock more money away. People 50 and over can contribute up to $30,500 to a 401k or another type of deferred compensation plan this year.
"That's a little bit extra money that you can put away in your retirement, which is a great way to save and get caught up before you retire," Sweeney shares.
Finally, four decades after Congress voted to slowly raise the full retirement age from 65 to 67, the goal close to being achieved, reaching 66 and eight months in the final half of 2024.
While you can begin collecting social security before age 67, your payments will be permanently reduced. On the other hand, waiting until 70 earns you a bonus.
"We really urge people to think about what is the right age to start claiming Social Security to maximize how much money you can get," Sweeney expresses.
