Talk With Us

Social Security Cost-of-Living Adjustment Largest in Decades

Social Security Cost-of-Living Adjustment Largest in Decades

Effective Jan. 1, 2022, Social Security recipients will see an increase in their monthly checks. Additionally, the cap on taxable income to help fund Social Security benefits will also be increasing.

The cost-of-living adjustment (COLA) will be 5.9% in 2022, affecting nearly 70 million Americans. This is the largest increase to the benefits in nearly 40 years. The COLA will amount to a little under $100 per monthly Social Security check, on average. Historically, the COLA had been under 2% for much of the past decade. The increased 2022 COLA is aimed to help offset rising costs and high inflation, according to industry groups.

“Today’s announcement of a 5.9% COLA increase, the largest increase in four decades, is crucial for Social Security beneficiaries and their families as they try to keep up with rising costs.”

Additionally, maximum earnings subject to Social Security payroll taxes will rise to $147,000 in 2022, up $4,200 from 2021.

This means some individuals may see a smaller net pay on their paychecks.

What’s Next?

Employers should be aware of the rising COLA and inform affected employees that they may see slightly reduced paychecks.

Employers should also ensure their payroll systems are updated to account for the increased taxable wage cap.

© 2021 Zywave, Inc. All rights reserved.

Human Resources

Karen Shannon

Vice President, Business Consulting/CHRO

Karen Shannon
Carolyn O’Kelley

Human Resources Consultant

Carolyn OKelley
Kenya Pearman

Human Resources Consultant

Kenya Pearman
Shynia Valenzuela

Human Resources Generalist

Shynia Valenzuela
Employee Benefits
  • Categories

  • Search for news articles by category.

  • Service Options

  • Manage your account quickly and easily.

    • Account Login
    • Report a Claim
    • Make a Policy Change
    • Request a Certificate
    • Request an Auto ID Card
    • Pay Your Bill
    • Review Your Policy