SOCIAL SECURITY

Senior citizens and other recipients of Social Security benefits will see their payments increase in 2012, according to a new government announcement. This 3.6 percent cost-of-living increase is the first granted for Social Security recipients since 2009.

Low Inflation Impacted Previous Years’ Social Security Payment Increases

By Casey Bond

Social Security at risk of running dry at some point in the future–a point that once seemed distant and not quite real to many young workers. Unfortunately, for the children and grandchildren of baby boomers, that day is now fast approaching.

A recent report issued by the Social Security inspector general revealed the office makes it a habit of issuing payments to deceased beneficiaries. This is at a time when the Social Security Administration is already in danger of running out of money for living recipients when they retire.

Social Security Has Paid $40.3 Million to Dead

The trust fund that supports Social Security disability benefits is expected to run out of money by 2017, according to new congressional estimates. If this occurs without Congress making adjustments, the program will be unable to pay full benefits to retirees in a few short years.

Baby Boomers Draining Social Security Trust Fund

Individuals who plan to sign up for Social Security or other federal benefits after April 30 should be prepared to receive their money electronically. Benefits will no longer be issued via paper check starting next month. The switch in issuance is a part of the government’s plan to phase out paper checks for all recipients in the coming years.

Direct Deposit Mandatory for New Federal Benefits Recipients

The Social Security tax reduction taxpayers have received has resulted in a 1-percent personal income boost, says a new report from the Commerce Department. However, despite this increase in income, consumers have only increased their spending slightly, most likely because they’re waiting to see improvement in the economy.

Social Security Tax Reduced 2 Percentage Points

In 2011, you should see a 2 percent increase in your paycheck, in addition to any other raises you receive. You don’t have to do anything to get this windfall, and you’ll never have to pay it back or include it on your tax return. Your check will be a little bit bigger this year–with no fanfare or effort on your part.

Finally, some good financial news. And from the IRS, no less!

Creating a mandatory retirement age is something an overwhelming number of U.S. retirees are opposed to, according to a new survey released by Extend Health, Inc. In fact, out of those surveyed who were asked if the U.S. should set a mandatory age, a whopping 85 percent said “No.”

Retirement Age Survey Results

Photo: Washington Times

Those receiving Social Security checks will be disappointed for the second year in a row as the annual cost-of-living increase will not be implemented for 2011. The 2010 failed increase was the first time in three decades that Social Security recipients did not receive their cost-of-living adjustments and it’s happening again.

Low Inflation Equals Failed Increases