The Social Security Administration said monthly benefits would increase 2.3 percent for more than 54 million Americans in 2008.
It is the smallest increase since 2001, when benefits rose just 2.1 percent. The government bases the amount of the cost-of-living adjustment on the rise in the Bureau of Labor Statistics' Consumer Price Index for Urban Wage Earners and Clerical Workers, which was also 2.3 percent. Last year, benefits rose 3.1 percent and in 2006 went up 4.1 percent.
Next year's increase will give retirees an average of $24 extra per month, going from an average of $1,017 to $1,041 for widows and widowers, and $1,722 to $1,761 for married couples.
Starting in January, the maximum amount of earnings subject to the Social Security tax will increase to $102,000 from $97,500. As a result, nearly 12 million workers will pay higher taxes.
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