Social Security Changes for 2021
1. Partly Cloudy: Slight Cost of Living Increase
It's not as big as the 2.8% increase retirees received in 2019, but the 2021 cost-of-living adjustment (COLA) of 1.3% is, at least, something. And it's intended to cover increased Medicare costs. For the average retiree, the increase means about $20 more each month.
2. Sunny: Maximum Benefits Go Up
The maximum wage cap limits the amount of your income that's subject to Social Security taxes. That limit increased in 2021 to $142,800—up from $137,700. The maximum monthly benefits limit, or how much you can collect, also increased to $3,148. This should be good news in retirement for workers who may be at the top of the income scale.
3. Sunny: Make More Money Without Raining on Benefits
If you collect Social Security and work part-time, the amount you can earn without your benefit being reduced has been raised. How much depends on whether you've reached full retirement age (FRA)—the age at which you can receive100% of your benefits.