In 2001, Social Security and SSI benefits will climb 3.5 percent, said Kenneth S. Apfel, commissioner of Social Security.

"Inflation is one of the worst enemies of the elderly. The past eight years, which have seen low inflation rates and a strong economy, have been particularly good for the elderly," said Apfel.

The 3.5 percent boost will begin with benefits that Social Security beneficiaries receive in January of 2001. Increased payments to SSI recipients will begin on Dec. 29.

According to the Administration, for Social Security beneficiaries the average monthly benefit amount for all retired workers will rise from $816 to $845. The maximum federal SSI monthly payments to an individual will rise from $512 to $530. For a couple, the maximum federal SSI payment will rise from $769 to $796.

Social Security and SSI benefits increase automatically each year based on the rise in the Consumer Price Index for Urban Wage Earners and Clerical Workers from the third quarter of one year through the corresponding period of the next, the Administration noted.

In addition, the maximum amount of earnings subject to the Social Security payroll tax will jump to $80,400 from $76,200. As a result, the maximum yearly Social Security tax paid by the employees and employers will increase by $260.40 each, the Administration said. For self-employed workers, it will rise by $520.80.

The amount of earnings required to earn a quarter of coverage will increase to $830, up from $780 last year, the Administration added.

-- SmartPros News Staff

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