Hi Larry, I apologize if this question has been asked before. I looked for it in the asked questions and didn’t see it. Can you explain how the COLA affects the family maximum benefit?

On a separate note, I read where there may be a $200 increase for recipients instead this year. . Have you also heard this? You are always so helpful. Thank you so much.

Hi. Social Security cost of living (COLA) increases are applied to family maximum benefit (FMB) rates at the same percentage as the COLAs applied to individual benefit rates. So, if several beneficiaries are collecting benefits from the same account and if they are collectively being paid the FMB, they will still receive their full individual COLA increases.

For example, let's say 4 children are splitting the FMB payable from their deceased father's account. The FMB is $2000, and each child is paid $500 (i.e. $2000/4). If there is a subsequent COLA increase of 5%, the FMB would increase to $2100 (i.e. $2000 x 1.05) and each child would receive $525 (i.e. $500 x 1.05, or $2100/4).

And, no, there isn't going to be an across the board $200 increase to Social Security benefits this year, although an unusually high percentage COLA is expected to occur effective with benefits paid in January 2023.

Best, Jerry