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11 big money changes in January

A NEW year often entails a lot of changes that can affect your finances – and the start of 2022 is no different.

Are from Social Security and the minimum wage increase on student loans, we’ve rounded up some of the key changes you need to know about from January.

Social Security claimants are getting a pay increase from January

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Social Security claimants are getting a pay increase from JanuaryCredit: Getty

It comes as December is filled with frantic holiday shopping and spending.

But there are also some key money moves you can make this month to help you achieve financial success in the new year – we’ve rounded these up in our guide.

1. Federal Student Aid Ends

Since the beginning of the pandemic, the United States has make pause on student loan repayment.

For now, the moratorium on interest payments and collections will expire on January 31.

The education ministry announced the “final extension” of the student loan moratorium in August.

Moving means you will have to keep paying from February 1, unless it is renewed again.

2. California’s Last Stimulus Test Goes Out

California has released stimulus checks for the second half of 2021 according to Golden State Stimulus II programme.

The final batch will ship from December 27 to January 11, 2022, marking the end of GSS II.

California residents earning less than $75,000 per year, and those who filed their 2020 taxes by October 15 are eligible for the payment.

It is estimated that a total of nine million people in The Golden State will be tested for the state’s stimulus, worth up to $1,100, under the initiative.

Californians may receive another round of stimulus next year thanks to a surplus fund of $31 billion, but this is not guaranteed.

3. No more prepaying the child tax credit

January is the first month without advance child tax credit payments, usually up to $300 per child.

These have been outed by tens of millions of families each month since July.

The final payment will be made on December 15, which means it may be time to reassess your finances to prepare for losing that money in January.

However, you may be entitled to a one-time, one-time payment of up to $1,800 when you file your 2021 tax return.

Child tax credits are worth $3,600 for each child under the age of six in 2021, $3,000 for each child age six to 17, and $500 for college students age 24 and up. down.

We explain more about child tax credit payments in our guide.

Social Security changes from January

4. 5.9% increase in retirement payments

In October, the Social Security Administration (SSA) confirmed the cost of living adjustment (COLA). will increase by 5.9% in January.

It means average test in 2022 for a retired worker will increase by $92 – from $1,565 to $1,657 a month.

Meanwhile, a typical couple’s benefit would increase by $154 – from $2,599 to $2,753 per month.

Social Security claimants are usually notified by mail as early as December of their new benefit amount.

COLA is given to the recipient when inflation goes up, and prices rose 5.4% in the 12 months ending September.

5. Enhanced Testing for Americans with Disabilities

The 5.9% COLA increase also applies to Social Security Disability Insurance (SSDI).

In fact, the average monthly benefit for disabled workers would increase by $76 – from $1,282 to $1,358 a month.

SSDI aims to provide relief to people with disabilities who are no longer able to work or are unable to work as before.

This benefit is intended to partially replace a qualified worker’s salary.

6. Income limit to increase

if you work while receiving Social Security benefits, your benefits may be reduced, depending on how much you earn.

If your income is more than $18,960 in 2021, the SSA will withhold $1 for every $2 you earn over the limit if you’re under full retirement age.

However, starting in 2022, this threshold will increase to $19,560.

If you reach retirement age in 2022, you’ll be able to earn $51,960 next year – up $1,440 from the 2021 annual limit of $50,520.

In that case, $1 is retained for every $3 earned above that threshold.

If you were born in 1960 or later, your full retirement age is 67. For everyone else, it’s 66 and a specific number of months.

7. Increase credit income threshold

If you were born in 1929 or later, you must have earned at least 40 credits during your working life to be eligible for Social Security benefits.

This is set to a maximum of four per year.

The amount needed to earn one credit increases slightly each year – and it will increase from $1,470 in 2021 to $1,510 in January – a $40 increase.

Meanwhile, the number of credits required for a disability depends on how old you were when you became disabled.

8. Workers pay more tax

Along with the COLA increase, the SSA also confirmed that the maximum earnings amount follows Social Security Tax will increase in January.

This figure will increase from $142,800 to $147,000, after the average salary increases.

It means that high-wage workers will have to pay tax on a larger percentage of their income.

9. New Federal Tax Rate

Internal Revenue Service (IRS) recently announced the tax rates for 2022, will come into effect from January.

Adjustments take into account the increase inflationary this year, with the latest data showing consumer prices rose to a 30-year high in October.

From January, the standard deduction (the amount of tax not due) for couples will increase to $25,900, up $800 from this year.

For single file people, this threshold will increase to $12,950 from $12,550.

You can check how much you will have to pay taxes from January depending on how much you earn our guide.

10. Medicare premiums skyrocket

Medicare premiums also set to jump in January, hitting the pockets of millions of Americans.

Medicare Part B standard premiums will increase 14.5% in 2022, meaning those who rely on coverage will face increases of more than $21 a month.

In addition to the standard premium, the deductible for Part B will also increase next year, from $203 to $233.

That’s a 14.8% increase from 2021 to 2022.

The Medicare Part A deductible is also increasing and will increase by $72 to $1,556.

11. States raise minimum wages

Last but not least, workers in nearly two dozen states could get a pay rise from next month when the minimum wage rises.

The federal minimum wage has stayed flat at $7.25 an hour for more than a decade — but some states are solving problems of their own.

For example, California is now placed as the first to implement a $15 minimum wage.

And other states are on track to raise wages in 2022, with 20 of them starting next month – you can check which states are doing it. our guide.

Scammers are trying to steal tax credits for kids by bombarding families with text messages and calls, IRS warns

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https://www.the-sun.com/money/4221998/big-money-changes-january-social-security/ 11 big money changes in January

DevanCole

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