Now you’ll need to earn more to get a Social Security credit: the changes for 2023

Now you’ll need to earn more to get a Social Security credit: the changes for 2023

In order for a person in the United States to obtain the necessary credits for retirement, they must be 40 and each credit has a value

By 2023, Social Security Administration beneficiaries will not only receive higher Cost of Living Adjustment (COLA) checks, which were 8.7%, but they will also need to earn more cash to get the necessary credits to retire at some point in your life.

This change means that now, starting in 2023, a Social Security credit will be worth $1,640 dollars and not $1,510, as it was stipulated for the year 2022. Work credits are “building blocks” that the agency uses to find out if you have worked enough to qualify for Social Security benefits.

If you stop working before you have the necessary credits to qualify for benefits, all credits earned up to that point will remain on your record. So, once you go back to work, you can add more credits to the ones you already had, so that you achieve your eligibility.

These credits are based on your income during the year. If you work and pay Social Security taxes, you can get up to four credits per year. As you can see, it is very difficult to obtain these credits, it is not that you accumulate a large number of credits in a short time.

In this sense, the amount of credits necessary to obtain your retirement is changing. So by 2023, you need to earn $1,640 to get a Social Security or Medicare credit and $6,560 to get the maximum of four credits in a year. No matter how high your income is, you will not be able to earn more than four credits in a year.

According to the Social Security Administration (SSA), in order for a person to retire, they must accumulate a minimum of 40 credits. The credits are only to pave the way for eligibility, but do not imply how much money seniors will receive as their benefits.

What will determine the amount that will be obtained during retirement will depend on the years worked and the income obtained during these years.

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