What is a Cost of Living Adjustment (COLA)? How does it affect my SSDI?
Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) are two programs implemented by the Social Security Administration (SSA) designed to provide financial relief to individuals who are disabled. SSI is also recoverable by those who are blind and who are aged 65 and older.
For those who receive SSDI and SSI, a Cost of Living Adjustment (COLA) can affect your benefit amounts. For all you need to know about a COLA and how it may affect you, refer to the following. If you ever require legal assistance in securing a fair benefit amount, then contact Rob Levine, the Heavy Hitter ® at 866-LAW-SSDI.
What is COLA?
So what is COLA? In 1973, legislation was enacted that provided COLAs for those receiving Social Security benefits. The legislation was enacted to ensure that the benefits amount keeps up with the pace of inflation. For example, a benefit amount may be increased if the cost of living increases.
How does COLA affect benefit amounts?
The latest COLA (payable as of January 2014) increased Social Security and Supplemental Security Income payments by 1.5 percent, according to the Social Security Administration. This means that a person receiving disability benefits of $1,914 before COLA is now receiving $1,943 in benefits after COLA, or an additional $29. As such, COLA is a very beneficial adjustment to those who receive Social Security benefits.
For Supplemental Security Income, the maximum amount payable for an individual in 2014 is $721 per month, which computes to $8,657.26 per year for 2014. In 2013, though, before a COLA was made, the amount was less: $8,529.32.
Student Earned Income Exclusions for Supplemental Security Income
Supplemental Security Income is reserved for those who are aged, blind or disabled, and have limited income or resources. Students who qualify and who regularly attend school may have earnings not counted against SSI benefits. A COLA may have an effect on income exclusions for students who for Supplemental Security Income.
For example, in 2013, the earned income exclusions for students for Supplemental Security Income was not more than $6,960 in 2013 (but not more than $1,730 per month); in 2014, that was increased by 1.5 percent to $7,060 or $1,750 per month.
How are COLAs calculated?
In order to determine COLA, the Social Security Administration applies a formula. The formula is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, which are calculated monthly by the Bureau of Labor Statistics.
If there is a percentage increase in the Consumer Price Index (CPI) for Urban Wage-Earners and Clerical Workers, then the increase is rounded to the nearest one-tenth of a percent. If an increase is not present, then a COLA will not be implemented for that year. There were no COLAs for 2009 and 2010, for example.
Need help with Social Security disability benefits? Contact Rob Levine now!
If you believe that you should be awarded Social Security disability benefits or Supplemental Security Income, an attorney can help you. Applying for Social Security Disability Insurance and Supplemental Security Income can be an intensive process that requires a thorough understanding of Social Security disability benefits law, as well as a detailed and accurate application for benefits.
In order to help you receive the benefits that you need and to which you’re entitled, the attorneys at Rob Levine & Associates will provide you with the support and legal know-how that you require. To speak with Rob Levine, the Heavy Hitter®, call us now at 866-LAW-SSDI.