Social Security recipients could get a 3.1% increase next year in their benefit, compared to the 8.7% Cost of Living Adjustment received in 2023.
The Social Security Administration will announce the actual cost of living adjustment for 2024 in October.
To arrive at the figure, SSA will compare the average consumer-price index from the third quarter of 2023 with the average data from the same period last year.
The Senior Citizens League, a nonprofit organization, estimated the underlying data that goes into the calculation to arrive at 3.1% and will update its projection monthly until the actual adjustment is announced in the fall.
In its May press release, the Senior Citizens League posted some interesting statistics on inflation, specifically regarding the fastest growing costs for older Americans.
The note highlights that between January 2000 and February 2023, Social Security COLAs increased benefits by 78%, averaging 3.4% annually, while the cost of goods and services purchased by typical retirees rose by 141%, averaging about 6.2% annually over the same period.
For many retirees, Social Security income is significant, but only part of their total income picture.
However, this information highlights the pernicious effect of inflation, the need to keep an eye on recurring expenses, and the importance of a long-term financial plan that takes into account the effects of rising costs over time.
RK