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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsSocial Security cost-of-living hike coming, but might not matter for many
Social Security recipients are in for their biggest cost-of-living increase in years in 2022, but much of the extra cash is likely to get eaten up by higher costs. Beneficiaries could see their payments rise 6% to 6.1% in January, according to a recent estimate from the Senior Citizens League, an advocacy group for seniors. The Social Security Administration typically announces its annual cost-of-living increase in October and it then takes effect in January. That would be the biggest cost-of-living hike since 1983, when a 7.4% increase took effect.
Much of the extra cash will probably be consumed by higher prices and rising Medicare premiums, according to The Motley Fool, a finance website. Medicare Part B monthly premiums will rise 6.2% next year, the Fool said. Thats higher than the cost-of-living increase predicted by the Senior Citizens League.
Rising prices throughout the economy will also consume some of the raise beneficiaries will get. In July alone, consumer prices were up 5.4% year over year, according to Yahoo Finance. In August, food inflation was up 3.7% and electricity was up 5.2%, according to The Motley Fool. Shelter inflation was up 2.8%.
The figures suggest many Social Security beneficiaries will simply see their cost-of-living hikes disappear thanks to higher prices. Social Securitys overall purchasing power has declined 30% since 2000. That means if you spent $100 in benefits today, youd wind up with nearly a third less in goods and services than you would have two decades ago.
https://www.pennlive.com/news/2021/10/social-security-cost-of-living-hike-coming-but-might-not-matter-for-many.html
The Grim Reality of Social Security's Record "Raise" in 2022
https://www.fool.com/investing/2021/09/26/grim-reality-social-securitys-record-raise-in-2022/
MineralMan
(146,189 posts)The COLA is important, although a major rejigger of the benefit is long overdue. If the COLA is not enough, the answer is not to skip it, however.
duforsure
(11,882 posts)Low and middle income people retired should not have any taxes coming out of their Social Security checks either. Cola is not keeping up enough, and those on Social Security just keep losing ground.
Lucinda
(31,170 posts)AllaN01Bear
(17,346 posts)before we even know about it and the cola is absorbed .
left-of-center2012
(34,195 posts)"Much of the extra cash will probably be consumed by higher prices ..."
Kaleva
(36,145 posts)From the article:
"Social Security recipients are in for their biggest cost-of-living increase in years in 2022, but much of the extra cash is likely to get eaten up by higher costs. "
https://www.pennlive.com/news/2021/10/social-security-cost-of-living-hike-coming-but-might-not-matter-for-many.html
The best one can hope for with a COLA increase is a net wash.
in2herbs
(2,942 posts)start in November. I'll have to wait and see before I believe there's a bigger increase than that.
left-of-center2012
(34,195 posts)Social Security increases always start with January's check.
in2herbs
(2,942 posts)left-of-center2012
(34,195 posts)link?
I found nothing on google saying that.
in2herbs
(2,942 posts)said it would be two months for the change of banks to take effect bc the checks are already done being processed bc they're prepared two months in advance.
Midnight Writer
(21,541 posts)It is not designed to increase the benefit.
It is designed to compensate for price increases.
Keeping up with inflation does matter to seniors.
left-of-center2012
(34,195 posts)The article could have stated it better.
As it has been commented on above.
fescuerescue
(4,448 posts)"Social Security recipients are in for their biggest cost-of-living increase in years in 2022, but much of the extra cash is likely to get eaten up by higher costs."
SSN is rising BECAUSE it's needed for those higher costs.