Social Security Disability Insurance (SSDI) is a program that offers financial support to people with disabilities who have previously paid Social Security taxes. In 2024, there will be important updates to SSDI payments due to a change called the Cost-Of-Living Adjustment (COLA). Let’s explore what these changes mean for SSDI beneficiaries.
SSDI Overview
SSDI provides financial aid to individuals with disabilities who have contributed to the Social Security system through their work. Starting in 2024, SSDI benefits will increase by 3.2% because of the COLA adjustment. This adjustment is designed to help benefits keep up with the rising cost of living in the U.S.
Payment Increases
In 2024, SSDI recipients will see a rise in their monthly payments. For example, the maximum monthly payment for disabled workers will increase to $1,537 from $1,489 in 2023.
This increase is due to the 3.2% COLA adjustment. Note that this is an average amount; the actual payment might differ depending on individual circumstances.
Breakdown of 2024 Payment Increases
| Benefit Type | 2023 Amount | 2024 Amount | Increase |
|---|---|---|---|
| Disabled worker | $1,489 | $1,537 | $48 |
| Disabled widow(er) | $897 | $926 | $29 |
| Aged widow(er) | $1,720 | $1,775 | $55 |
| Spouse of retired worker | $885 | $913 | $28 |
| Retired worker | $1,847 | $1,906 | $59 |
These updates help to maintain the value of Social Security benefits in the face of inflation.
SSA Notifications
In December 2023, the Social Security Administration (SSA) will send out letters to beneficiaries explaining the changes to SSDI and other Social Security benefits.
These letters will detail the new payment amounts based on each person’s situation. Beneficiaries can also check their COLA notices in the message center of their my Social Security accounts.
Payment Timing
Some Social Security beneficiaries will start receiving their increased payments as early as December 29, 2023. The SSA expects about 71 million people enrolled in various Social Security programs to receive higher benefits in 2024.
What is COLA?
Cost-Of-Living Adjustments (COLA) are annual increases in Social Security benefits to counteract inflation. For 2024, the COLA is set at 3.2%, as announced by the SSA on October 12, 2023. This adjustment helps ensure that the value of Social Security benefits does not decrease due to inflation.
Historical COLA Figures
Here are the COLA adjustments from previous years:
- 2022: 5.9%, with an average of $1,358 per month for disabled workers.
- 2023: 8.7%, with an average of $1,483 per month for disabled workers.
These adjustments show the SSA’s effort to maintain the purchasing power of Social Security benefits.
Tax Rates and Thresholds
Even though SSDI benefits are increasing, the tax rates for employees and self-employed people will remain the same in 2024:
- Employees: 7.65%
- Self-employed: 15.3%
The Maximum Taxable Earnings threshold is set at $168,000 for 2024. This is the highest amount of earnings that are subject to Social Security taxes.
Key Takeaways
The 2024 SSDI payment increase is aimed at helping beneficiaries manage the higher cost of living. Staying informed through SSA notifications and using the my Social Security portal will ensure beneficiaries get the most accurate and timely information.
With these updates, SSDI continues to play a vital role in providing financial security to people with disabilities, helping them live more stable and independent lives.
What is SSDI?
SSDI is a program that provides financial support to people with disabilities who have paid Social Security taxes through their work.
Why are SSDI payments increasing in 2024?
Payments are increasing due to a 3.2% Cost-Of-Living Adjustment (COLA) to help benefits keep up with inflation.
When will the new SSDI payments start?
Some beneficiaries may start receiving their increased payments as early as December 29, 2023.
How will I be notified of the changes to my SSDI benefits?
The SSA will send letters in December 2023 detailing the changes. You can also check your COLA notice in your my Social Security account.
Will my taxes on SSDI benefits change in 2024?
No, the tax rates for employees and self-employed individuals will stay the same in 2024.
