With 2022 just beginning, we thought we’d share with you some of the changes to Social Security. The Social Security Administration has issued a 5.9% cost-of-living adjustment (known as a “COLA”) for 2022, the largest COLA in nearly 40 years. How much of a difference this will make in your life really depends on your overall financial needs and situation. The increase in Social Security benefits can help offset inflation. However, it will not reduce the amount of Required Minimum Distributions (RMDs) you will still be required to take from your retirement accounts (for example, your IRA.) It’s possible you won’t need your RMD to offset inflation, because COLA helped you do that. There are options available for using that RMD money to further increase your income later on in retirement.
We’re always here to help, and are happy to explain some choices you may not have thought of.