Social Security cost-of-living adjustment will be 8.7% in 2023, highest

5 Likes

yep, saw that too - probably inflation will eat up most of the increase. Government giveth and taketh away, right? LOL

1 Like

Our Medicare payments will be going down, so that helps.

3 Likes

Looks like our RMDs will be lower too. Less income taxes to pay.

2 Likes

I didn’t see that in the article.
Does COLA affect the calculation for RMDs?
I thought it was strictly actuarial based on life expectancy (so that all deferred taxes are paid in the expected time). Given that life expectancy has dropped overall, shouldn’t that actually increase the RMDs?

1 Like

I could be wrong but since the market in general is down you can expect your year end balance in your IRA to be down as well. When you go to the table to look up your multiplier even though it will be larger the result of the calculation will more than likely be lower than what it was last year. Good luck if you understood the gobbly-guck I just wrote.

4 Likes

Nah, it was perfectly clear. I forgot that part about the year-end balance, but I doubt if it’s a permanent condition. Might turn out to be just bigger increases in future years (from a low base as it were).

Were today 31 December 2022, my 2023 RMD would be around $33,000 less than my 2022 RMD. Unfortunately, I don’t know what will happen between now and the end of the year.

COLA has no impact on calculation of your RMD; however, your 2021 RMD can have an impact on whether you will see any or all of the 8.7% increase in Social Security benefits.