Social Security recipients could see biggest boost in 40 years
Social Security beneficiaries could see the largest increase in 40 years, as the U.S. continues to battle record inflation.
The nonpartisan Senior Citizens League estimated on Wednesday the adjustment for 2023 could be as high as 8.6%. That figure comes from April inflation data that showed consumer prices rose 8.3% over the previous year, close to a 40-year high. The annual Cost-of-Living-Adjustment is calculated based on the Consumer Price Index for Urban Wage Earners and Clerical Workers that rose 9.4% over the past year.
If monthly benefits rise by 8.6%, it would mark the steepest annual adjustment since 1981 when recipients saw an 11.2% increase, Fox Business reported. The annual numbers will be released in October.
Social Security beneficiaries received a 5.9% increase in 2022, equaling a boost of about $92 per month for most retired workers and bringing the average benefit to $1,657 per month. Rising inflation has eroded most of that increase, however.
According to the League, Social Security recipients have lost 40% of their buying power since 2000.
“Retirees know all too well that, Social Security benefits don’t buy as much today, as when they first retired,” said Mary Johnson, a Social Security policy analyst for The Senior Citizens League. “To put it in context, for every $100 of goods or services that retirees bought in 2000, today they would only be able to buy $60 worth.”
A League study found that Social Security COLA benefits have risen by 64% since 2000 even as typical senior expenses through March 2022 grew by more than double that rate — 130 percent. To maintain the same purchasing power as 22 years ago, benefits would have to increase by $539.80 per month.