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Monthly benefits for nearly 64 million Americans will increase 1.7 percent in 2015, the Social Security Administration announced Wednesday.
That translates to an increase of roughly $20 a month for the typical Social Security recipient.
The 1.7 percent cost-of-living adjustment (COLA) will begin with benefits that more than 58 million Social Security beneficiaries receive in January. Increased payments to more than 8 million Supplemental Security Income beneficiaries will begin on Dec. 31.
The annual COLA change is tied to the Consumer Price Index, which posted an anemic 0.1 percent increase in September after dropping 0.2 percent a month earlier. Inflation remained tame, due in large part to low energy prices.
Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $118,500 from $117,000. Of the estimated 168 million workers who will pay Social Security taxes in 2015, about 10 million will pay higher taxes because of the increase in the taxable maximum.
With inflation running low, it's the third-straight year that the COLA will be less that 2 percent.
—The Associated Press contributed to this report.