As living costs rise, Social Security recipients will get a $92 increase in monthly benefits.
According to the Associated Press, millions of Social Security recipients will receive an extra $92 per month as a result of a cost-of-living adjustment (COLA) for increased expenses during the coronavirus outbreak.
Starting next year, the increased COLA, which is the greatest in 39 years, will offer the average retiree a 5.9% increase in overall benefits. Over the last ten years, cost-of-living adjustments have averaged 1.65%.
With the revised adjustment, the average retiree will earn $1,657 per month, while a typical couple will receive $2,753 per month.
Cliff Rumsey, a retiree in Hilton Head Island, South Carolina, who is caring for his wife, told the Associated Press that since the pandemic began, he has noticed cost-of-living hikes in various categories, including food prices, caregiver wages, energy bills, and personal care products. He remarked, “It goes really rapidly.”
See the list below for more Associated Press reporting.
For nearly 1 in every 5 Americans, the COLA has an impact on their household budget. This includes approximately 70 million people, including Social Security beneficiaries, handicapped veterans, and federal retirees. It will be the largest rise in the lives of baby boomers who retired within the last 15 years.
“It’ll be welcomed,” said Mary Johnson, an analyst with the nonpartisan Senior Citizens League advocacy group. “However, we’ve heard that even with the COLA, purchasing power would be reduced because price rises will continue.” The COLA, according to policymakers, was created as a safeguard to keep Social Security benefits from losing purchasing power in an ever-changing economy, not as a pay raise for retirees. About half of seniors live in households where Social Security payments account for at least half of their income, and a quarter rely entirely or virtually entirely on their monthly payment.
“You never want to discount the value of the COLA, whatever of its magnitude,” said retirement policy expert Charles Blahous, a former public trustee who oversaw Social Security and Medicare finances. “The number that is released has a significant impact on what people are able to buy. In many cases, we’re talking about basic essentials.” The Social Security trustees report this year exacerbated concerns about the program’s long-term financial soundness, but there is yet hope. This is a condensed version of the information.