The government announced this Wednesday that millions of Americans who rely on federal benefits will see a 1.7 percent increase in their monthly payment next year.This is the third year in a row when the increase was less that 2 percent. The amount increased by about 20 dollars a month for an average Social Security Recipient.
The COLA [cost-of-living adjustment] helps beneficiaries of all ages maintain their standard of living, keeping many from falling into poverty by providing partial protection against inflation,” said Jo Ann Jenkins, who heads AARP.
This law is based on inflation which is below historical averages this year. Because inflation is low, the cost-of-living adjustment is going to be low too, since it is meant to compensate for inflation. According to the September inflation report, gasoline prices have dropped over the past year while the cost of clothing is up by less than 1 percent. Additionally, the cost of meat, fish and eggs is up by 10 percent, yet the overall cost of food is up just 3.1 percent. Medical costs are up 1.9 percent this year as well.
Over the course of the first 35 years, the COLA was less than 2 percent only three times. Next year, the COLA is expected to be less than 2 percent for the fifth time in six years. Currently, about 59 million retirees, disabled workers, disabled veterans, spouses and children get Social Security benefits.
News of the cost-of-living adjustment for the coming year always is eagerly awaited by the countless Americans who rely on the increase to keep up with the rising price of food, housing, transportation and medical care,” Beaudoin said in a statement. “However, despite the partial relief this COLA will provide, the announcement is a reminder that our method for calculating the increasing cost of goods and services is out of sync with the reality faced by millions of federal (retirees), Social Security recipients and military retirees.”
Read more here – “Social Security benefits to go up by 1.7 percent,” (The Washington Post).
Anna is a current student at The George Washington University in Washington, DC with a concentration in Marketing and Communication. She specializes in social media outreach and has experience working in government contracting.