When it comes to managing your life as a retiree, it almost goes without saying that you’ll need to keep abreast of the yearly Social Security tweaks and adjust your budget accordingly. However, with so much new information to keep track of, it can be easy to forget some of the smaller details, such as when benefit payments are distributed—especially considering that this answer isn’t exactly clear-cut and varies from person to person. As such, we have put together a Social Security benefits payment schedule for 2023, which can be found below.
- Fifty percent of all older Americans reside in households where Social Security benefits account for at least half of their income, while one-quarter depend on their monthly payment for most or all of their earnings.
- Depending on the day when a retiree was born, Social Security retirement, disability, and survivor benefits will be distributed on either the second, third, or fourth Wednesday of each month. Beneficiaries who received benefits prior to May 1997 will instead have their payments distributed on the third Wednesday of each month.
- Beginning in January 2023, approximately 64 million Americans will receive a 8.7% cost-of-living adjustment (COLA) to their Social Security retirement, disability, and/or survivor benefits. Supplemental Security Income (SSI) benefits also will be affected by COLA. This is the largest cost-of-living adjustment since 1981, when it was 11.2%. The largest ever was 1980’s 14.3%.
- The 2023 COLA increase will raise the total average benefit to $1,827 per month for individual retirees and $2,972 per month for couples. The average disability benefit payment will increase to $1,483 per month; disabled workers with a spouse and one or more children will experience an increase to $2,616 per month. Widows and widowers will receive an increase to an average of $1,704 per month; widowed mothers with a minimum of two children will receive a much larger $3,520 per month on average.
- Other major changes include the maximum amount of earnings subject to the Social Security tax increasing to $160,200, the earnings limit for still-employed beneficiaries who are younger than their full retirement age increasing to $21,240, and the earnings limit for beneficiaries who will reach their full retirement age in 2023 increasing to $56,520.
Understanding Social Security Payments
Social Security, officially known as the Old-Age, Survivors, and Disability Insurance (OASDI) program, provides monthly monetary benefits to qualified workers and their dependents (if any). It’s considered an entitlement program, wherein employees, employers, and the self-employed finance these benefits with their Social Security taxes, which are then put into two Social Security trust funds. Eligibility and benefit amounts are based on an individual’s contributions to Social Security and work history (or that of their spouse/parent(s)).
The Social Security Administration (SSA) offers three types of Social Security benefits:
- Retirement: This is the best known variety of Social Security benefit, which is available for individuals age 62 or older who have worked a minimum of 10 years. The amount someone receives in retirement benefits is dependent on their pre-retirement salary and the age at which they begin collecting benefits. Additionally, a retiree’s spouse (whether currently married or divorced) also may be eligible for Social Security retirement benefits, regardless of whether or not they have paid into the program.
- Disability: People who are unable to work due to a disability are eligible for Social Security Disability Insurance (SSDI) benefits, as long as they have worked a certain number of years beforehand. The amount of work required varies based on an individual’s age, while the monthly payment depends on their pre-disability salary. Like retirement benefits, SSDI also may be available for a retiree’s spouse (whether current or former).
- Survivor: Survivors benefits are typically available for widows and widowers, qualifying divorced spouses, and the children of a deceased worker/retiree following their passing. The benefit amount varies based on the worker’s salary and age at death, in addition to the survivor’s age and relation to the deceased individual. An additional death benefit is also available, which is a one-time payment of $255 that is distributed to the spouse or children of a deceased retiree.
Supplemental Security Income
There is a fourth kind of benefit made available by the SSA, though it isn’t part of Social Security. Financed by general tax revenues, Supplemental Security Income (SSI) is a needs-based program designed to help those with limited income and resources who are unable to earn sufficient wages on their own.
Adults and children with disabilities, as well as individuals age 65 or older, are eligible to receive SSI benefits. The amount retirees are given depends on federal and state laws, which take into account their place of residence, who lives with them, and their other sources of income. No work credits are required, and those with enough work history may be eligible for both SSI and Social Security benefits.
Social Security benefit rates rise in tandem with the cost of living, as measured by the U.S. Department of Labor’s Consumer Price Index (CPI-W). This index is boosted by increased inflation rates that raise the cost of goods and services. To offset these costs and ensure that the purchasing power of Social Security benefits isn’t eroded by inflation, the SSA will issue what’s known as a cost-of-living adjustment (COLA).
According to a formula outlined in the Social Security Act, COLAs are based on increases in the CPI-W. Specifically, a COLA is equal to the percentage increase in the CPI-W from the average for the current year’s third quarter to the average for Q3 of the prior year in which a COLA was enacted. Increases must be rounded to the nearest tenth of 1%. Should there be no increase, or if the end result rounds to zero, no COLA is issued for that year.
Managing retirement benefits is an ongoing part of retired life. Therefore, it’s important to understand what you’re entitled to, stay up to date on program changes, and make certain that the SSA has your current information.
Payment Schedule for 2023
Approximately half of older Americans reside in households where Social Security benefits comprise a least 50% of their income, and 25% of this group depend on their monthly payment for the majority (if not all) of their earnings. As such, it’s important for retirees to be aware of when they will receive their benefits. While this is especially crucial to the 0.8% of beneficiaries who need to be on the lookout for a physical check each month, the remaining 99.2% still ought to know when their Social Security income is being direct deposited to ensure that they aren’t spending more money than they actually have.
Social Security retirement, disability, and survivors benefits all are distributed on one of three Wednesdays each month for beneficiaries who began receiving benefits after May 1997. When a beneficiary will receive their payments depends on their birth date, as described below:
- If you were born between the 1st and the 10th, you will receive your Social Security payments on the second Wednesday of each month.
- If you were born between the 11th and the 20th, you will receive your Social Security payments on the third Wednesday of each month.
- If you were born between the 21st and the 31st, you will receive your Social Security payments on the fourth Wednesday of each month.
SSI benefit payments follow a different schedule. Specifically, SSI benefits are distributed on the first of each month. Should the first of the month fall on a weekend, then the new payment date will be the last Friday of the prior month. For 2023, there will be no SSI benefit payments in January, April, July, and October, while beneficiaries will receive their payments at both the beginning and end of March, June, and September.
Exceptions to the Payment Schedule
There are several cases where the default payment schedule isn’t followed and Social Security benefits are paid at a different time. The current exceptions include:
- Payment to children or spouses who receive benefits based on someone else’s work record will be paid on the same day as that primary beneficiary.
- Benefits to individuals who also receive SSI due to disability, age, or blindness will be paid on the 1st of each month.
- Individuals whose payment date falls on a federal holiday or weekend will be paid on the weekday immediately prior.
In addition, Social Security payments will automatically be issued on the 3rd of each month to individuals who:
- Filed for benefits before May 1, 1997.
- Also receive Supplemental Security Income payments.
- Have their Medicare premiums paid for by the state where they live.
- Live in a foreign country.
Getting Your Payments
The SSA began phasing out paper checks roughly a decade ago. Social Security benefits are now issued electronically. Individuals receiving benefits have a few digital options.
First, Social Security benefits can be distributed via direct deposit. Individuals can visit their local branch or contact their Social Security office to sign up. Individuals should be prepared to present their Social Security number, their financial institution’s routing number, their account number, and their account type (checking or savings).
Social Security benefits can also be awarded via a Direct Express card. A Direct Express card is a debit card that can be used to access benefits without the use of a bank account. Monthly benefits are deposited directly to the card, and individuals can use the card to make purchases. The Direct Express card can also be used at ATMs, banks, or credit unions to get cash.
The 8.7% COLA also applies to the approximately 8 million SSI payments that go out and will begin on Dec. 30, 2022. Some beneficiaries will receive both Social Security and SSI benefits.
What If Your Payment Hasn’t Arrived Yet?
For several reasons, Social Security payments may sometimes be late. Those reasons can include but are not limited to:
- Delays for initial Social Security benefits
- Process slowdowns at the SSA
- Updates to your personal information, such as your mailing address
- Changes to your payment information, such as a new checking account
- Inclement or severe weather
If your Social Security payment is late, contact the SSA immediately. For delays potentially caused by changes in your personal information, contact your local SSA office.
The SSA often issues notices of delays that collectively impact a region or number of individuals. For example, the SSA may post updates on delayed payments in areas affected by severe weather. For delays potentially impacting other individuals, monitor SSA communication and media channels.
Consider waiting a few business days for nonemergency delays. Benefits, though not yet received when they should have arrived, may already be in transit and late due to the post office, bank, or SSA. Contact the SSA when you feel it’s appropriate, recognizing that it may request that you wait longer to ensure payment has truly gone missing.
Workers who have reached full retirement age or older for the entire year are not subject to a limit on earnings.
What Beneficiaries Can Expect in 2023
On Oct 13, 2022, the SSA announced its annual changes to the Social Security program for 2023. Starting Jan. 1, 2023, more than 65 million Americans will receive an 8,7.% COLA to their Social Security benefits.
This represents the largest cost-of-living adjustment since 1981, due to a spike in inflation resulting from ongoing economic difficulties caused by the COVID-19 pandemic. In 2022, the increase was 5.9% and, prior to that, COLA averaged just 1.65% per year over the previous 10 years while inflation remained low.
According to estimates released by the SSA, this increase will amount to more than $140 for the average retired worker, raising their total benefits to $1,827 per month in 2023. Couples, meanwhile, will experience an average benefits increase of $238 to $2,753 per month.
Disability benefit average payments will increase $119 to $1,483 per month. Disabled workers with a spouse and one or more children will experience an average $133 increase to $2,972 per month. Lastly, widows and widowers will find their average benefits increasing by $209 to $2,616 per month. Notably, widowed mothers with a minimum of two children will receive an average $282 increase to $3,520.
In addition to the COLA, several other major Social Security changes will go into effect in 2023:
- The maximum amount of earnings subject to the Social Security tax, also known as the taxable maximum, will increase to $160,200.
- The earnings limit for workers receiving retirement benefits who are younger than their full retirement age will increase to $21,240. Recipients who go above this limit will have $1 of benefits deducted for every $3 earned above $21,240.
- The earnings limit for still-employed beneficiaries who will reach their full retirement age in 2023 will increase to $56,520. Recipients who go above this limit will have $1 of benefits deducted for every $3 earned above $51,960 until the month they turn their full retirement age.
- The retirement age for Social Security is currently set to increase by two months each year until it reaches 67 for those born in 1960 or later. The full retirement age for anyone who turns 64 in 2023 is 66 and 10 months.
- For 2023, the credit-earning threshold will increase $130 to $1,640 in earnings per credit.
What is the Social Security payout schedule for 2023?
Social Security benefits will be paid on either the second, third, or fourth Wednesday of each month. Which of these three is chosen will depend on the day of the month when a retiree was born.
What will the 2023 cost-of-living adjustment (COLA) for Social Security be?
Beginning in January 2023, a 8.7% COLA will increase Social Security benefits for more than 65 million Americans. Skyrocketing inflation amid ongoing economic difficulties caused by the COVID-19 pandemic have resulted in the largest cost-of-living adjustment in 41 years.
How much will Social Security Disability Insurance (SSDI) be in 2023?
SSDI benefit payments will increase an average of $119 to $1,483 per month for all disabled workers in 2023. Meanwhile, those with a spouse and one or more children will benefit from an average $209 increase to $2,616 per month.
When does the Social Security Administration (SSA) distribute Supplemental Security Income (SSI)?
Individuals who were born prior to May 1997—or who receive both Social Security and SSI—will receive a payment for Social Security on the third day of each month. Should the third of the month be a weekend, payments will instead be issued on the first Friday of that month. Payments for SSI (if applicable) will arrive on the first day.
Does Social Security pay a month ahead or a month behind?
Social Security benefits are paid in the month following the month in which they are due. For example, the payment for Social Security benefits awarded in January are paid in February.
The Bottom Line
When it comes to Social Security, there are many rules and much detailed information to be mindful of. Even minor mistakes can have a noticeable impact on your life in retirement. Accidentally overspending on your weekly budget because you thought your monthly Social Security benefits had already been deposited shouldn’t be something you have to worry about, so consider marking the appropriate dates listed above on your calendar.