A new year means a generous raise for seniors on Social Security. Benefits are going up 8.7% in 2023 thanks to the largest cost-of-living adjustment (COLA) in years.
All told, the average Social Security benefit is expected to rise this month from $1,681 to $1,827. That's a nice boost -- and it could help many seniors gain buying power at a time when living costs are extraordinarily high.
But Social Security's giant COLA could put more seniors at risk of falling victim to scams. And that's something beneficiaries should be aware of.
Image source: Getty Images.
Don't get conned out of your benefits
It's unfortunate that older people tend to be targeted by financial scammers. The logic is that they may be less tech-savvy than their younger counterparts, and therefore easier to trick.
As such, in the coming days or weeks, you may get a phone call out of the blue from someone claiming to work for the Social Security Administration (SSA). That person might tell you that you need to verify your bank account information so your 8.7% Social Security raise can be processed. You may also be told that you need to give the SSA access to your bank account, including your online banking password, so the agency can process that change.
That right there is an easy way for a scammer to empty out your bank account, take the money, and run. And depending on the information you give out, a scammer might also manage to steal your Social Security benefits by diverting those payments to a new account you don't have access to.
That's why it's so important to be vigilant when it comes to Social Security. One thing you should know is that the SSA will never call, text, or email you out of the blue asking for information like bank account details or a banking password. So that alone should raise a red flag.
Also, if you're already collecting Social Security, you don't actually need to do anything to snag your 8.7% raise. All you need to do is sit back and wait for your first benefit payment of 2023.
Social Security COLAs are processed automatically -- you don't need to apply for one or refile a Social Security claim to get that extra money. And anyone who tells you otherwise is probably trying to steal from you.
Stay alert
You may end up getting targeted by a scammer in a context not related to Social Security. For example, someone might call claiming your credit card has been flagged for suspicious activity.
Any time you get any sort of communication out of the blue where you're asked for personal or financial details, ignore it or hang up the phone. If you want to play it safe, be the one to initiative the call to the institution claiming to contact you and ask to speak to a representative.
If you're calling the number on the back of your credit card, for example, then you can rest assured that you're speaking to a legitimate representative. The more vigilant you are, the less likely you'll be to fall victim to a financial scam.
