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Social Security Benefits Get a 5.9% Raise This Year -- Here's When You Should See That Extra Money

By Maurie Backman – Jan 7, 2022 at 7:02AM

Key Points

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Many seniors are eager to see their incomes rise. Here's when this year's cost-of-living adjustment takes effect.

Last year, the Social Security Administration announced that seniors would be getting their largest cost-of-living adjustment, or COLA, in decades. Fueled by rampant inflation, Social Security benefits are in line for a 5.9% boost this year.

That's money many seniors may be counting on before it even arrives. If you're not sure exactly when your raise will take place, here's what you need to know.

It's all about your date of birth

The first Social Security payment you'll receive in 2022 should reflect that 5.9% COLA. And the timing of that payment hinges on your date of birth.

If your birthday is between the 1st and 10th of the month, your benefits should arrive on the second Wednesday of every month. As such, you should see your Social Security COLA hit on January 12.

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Image source: Getty Images.

If your birthday is between the 11th and the 20th of the month, your benefits should arrive on the third Wednesday of every month. That means your raise should take effect on January 19.

Finally, if your birthday is between the 21st and 31st of the month, your benefits should arrive on the fourth Wednesday of every month. So you should see your COLA on January 26.

You may not get your COLA in full

If you're collecting Social Security but have yet to enroll in Medicare, then you should see your monthly benefit increase by 5.9%. But if you're enrolled in Medicare Part B and therefore pay your premiums directly out of your benefits, your raise may look less substantial.

The reason? Medicare Part B premiums have risen this year to $171.10, up from $148.50 in 2021. That's an increase of $21.60. As such, when you get your first Social Security payment of the year, it will reflect a 5.9% COLA minus that Part B premium hike, leaving you with less money to pocket.

How to make the most of your COLA

It's been many years since Social Security has gotten anywhere close to a 5.9% raise. Even if you're losing some of that money to higher Medicare costs, it still pays to bank as much of that raise as you can to build yourself a financial cushion.

Granted, that may be a difficult thing to do at a time when living costs are up across the board and everything from groceries to gas to apparel costs extra. In fact, the whole reason this year's COLA was so generous is that inflation levels from the third quarter of 2021 triggered a larger raise. Had inflation been less rampant, seniors would've seen a less generous COLA come through.

But if you are able to eke out a little bit of monthly savings thanks to this year's COLA, it's a good idea to sock that money away in savings. We don't know what future Social Security COLAs will look like, but in recent years, they've fallen short (and in some years, seniors got no COLA at all). So it pays to build some cash reserves if you have the opportunity.

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