According to Money.USNews.Com, Social Security beneficiaries won't get bigger payments in 2016. There wasn't enough inflation in 2015 to trigger a cost-of-living adjustment to monthly benefits. However, there are a few ways Social Security will change next year.
No payment increase. This is the third time there has been no Social Security payment increase since automatic cost-of-living adjustments began in 1975. There was also no increase in payments in 2010 and 2011. In January 2015 the cost-of-living adjustment was 1.7 percent. Social Security payments are adjusted to keep up with inflation as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers, but are not decreased when the index does not detect inflation. The average monthly benefit for retired workers is expected to be $1,341 per month in 2016, and retired couples who are both receiving benefits will receive an average of $2,212 monthly.
Stagnant tax cap. In years when there is no cost-of-living adjustment, there is also no change in the maximum amount of earnings subject to the Social Security tax, which will remain $118,500 in 2016. Earnings above this amount are not subject to the Social Security portion of the payroll tax or used to calculate retirement payouts.
Earnings limit unchanged. The Social Security earnings limit for people who work and claim Social Security payments at the same time will remain $15,720 in 2016 for people ages 65 and younger. Social Security beneficiaries who earn more than this amount will have $1 in benefits temporarily withheld for every $2 in earnings above the limit. For people who will turn 66 in 2016, the earnings limit climbs to $41,880, and the reduction in payments for earning too much declines to $1 withheld for every $3 in excess earnings. Once a retiree turns 66 in 2016, the earnings limit no longer applies and benefit payments are recalculated to factor in withheld payments and continued earnings. Source: money.usnews.com
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