If energy prices hold steady for the next two months, he said, the COLA could be as high as 9.3%. Some of that might even out a bit here in 2023. The group estimates that the shortfall is roughly $58 a month on a $1,656 monthly Social Security benefit. "The actual COLA we received has fallen short of actual inflation," Johnson said. For year over year in June, the inflation index climbed 9.1%. Over the 12 months ending in July, the consumer price index rose 8.5%. Inflation has been running at a much hotter pace than the 5.9% inflation adjustment that was given in 2022 to retirees and people receiving Supplemental Security Income payments, which are made to those with a disability or blindness who have income and resources below specific limits. While an inflation adjustment for Social Security benefits helped this year based on 2021 data, for example, it did not reflect all the continued inflationary pressures in 2022. Retirees couldn't keep up with inflation this year, though, as many pensions aren't adjusted for inflation - and many retirees do not have pensions at all. July did show improvement when the month-to-month change was flat, reflecting in part a 7.7% decline in gasoline prices in the month. Inflation was high last year - and it soared even more so far in 2022. While you can trim some spending by turning to generic brands, eating less meat or going out for lunch less often, everything we buy isn't discretionary and cannot be scratched off a shopping list.
If you need about 10% more money now, for example, to buy the exact same groceries and other goods you bought a year ago, you're going to drain whatever savings you have much faster.
#2022 social security increase free#
"Every COLA is meaningful," Johnson told the Free Press, "because Social Security is one of the only forms of retirement income that is adjusted for inflation." Johnson said the deepest impact of inflation has been felt by those older adults who aren't bringing home any paycheck, even a small one as well as seniors who don't have a pension or any savings.
"This will be one of the highest COLAs ever paid in the history of the program," predicted Mary Johnson, a Social Security policy analyst for The Senior Citizens League, a nonprofit advocacy group.īut you'd have to go back to 1979, 19 for any inflation adjustment that would be 9% or higher. We must wait until October for the official cost-of-living adjustment (COLA) for 2023 to be announced by the Social Security Administration. A cost-of-living adjustment in this example would be an additional $1,800 a year. On average, a retiree could see about an extra $150 a month - if there's a 9% cost-of-living adjustment to Social Security for next year - based on an example of current benefits of around $1,656 a month. Thanks to surging inflation, though, those collecting Social Security benefits can look forward to a Social Security payout that's roughly 8% to 9% higher in 2023, based on early estimates. Inflation is brutal for lower-income consumers, including millions of retirees, who don't have any or much savings to tap into as the cost of gas, groceries and rent climb higher and higher. And for many retirees, the budget relief can't be quick enough. A bigger inflation-boosted Social Security check and, yes, hope for some relief from the headaches caused by high prescription drug costs are on the horizon.
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