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US Social Security benefits get 1.7 percent increase

October 16, 2012 12:00:00 AM PDT
U.S. Social Security recipients will receive a little extra in their bank accounts starting in January 2013 thanks to a 1.7 percent benefit increase announced Tuesday.

The increase is tied to a government measure of inflation of 3.6 percent over the past year, a relatively low figure. That number determines whether people who receive Social Security get a cost-of-living adjustment, or COLA.

About 8 million people who receive Supplemental Security Income will also receive the 1.7 percent COLA, indicating the increase will affect about one in five Americans.

The increase is among the lowest since automatic annual adjustments were adopted in 1975.

Social Security payments for retired workers average $1,237 a month, or about $14,800 a year.

However, the amount of wages subjected to Social Security taxes is also going up. Next year, it increases to $113,700, which will result in higher taxes for nearly 10 million workers and their employers.

The Associated Press contributed to this report.


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