Lately, there’s lots of chatter about the COLA for next year being the biggest since 1980 when it was 14.3 or 1981 when we received 11.2. Anything in the double digits would be huge for us. It would be a first for me. My VA disability started, in 1991 and my SSDI didn’t start until 1998 I think.
Since 1982, there hasn’t been a cost-of-living adjustment (COLA) above 10%. The last time it happened was, in 1982 when the COLA went up 11.2%.
What is scary is several sources say Americans will stop receiving their full Social Security benefits in 2035 if lawmakers don’t act.
Yahoo/Finance The Wednesday Consumer Price Index report showed that June’s inflation surged by 9.1%. According to the Senior Citizens League, the COLA (cost-of-living adjustment) for 2023 will be approximately 10.5%. This is great news for seniors struggling to keep up with the rising living costs.
Fool.com According to Mary Johnson, a Social Security policy analyst at The Senior Citizens League (TSCL), a nonpartisan senior advocacy group, the program’s COLA could be as high as 11.4% in 2023 if inflation continues to surge in the third quarter.
Here is a link to Google Search for COLA 2023 so you can keep track of the news on the 2023 COLA as we get closer to its announcement in October 2023.
The COLA is designed to keep your Social Security and Supplemental Security Income (SSI) benefits from losing value to inflation. It’s based on the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of the last year a COLA was determined to the third quarter of the current year. If there’s no increase, there can be no COLA.
The CPI-W is determined by the Bureau of Labor Statistics in the Department of Labor. By law, it is the official measure used by the Social Security Administration to calculate COLAs.
In 1972 Congress enacted Social Security Amendments, and automatic annual COLAs began in 1975. Before that, benefits were increased only when Congress enacted special legislation.
Beginning in 1975, Social Security started automatic annual cost-of-living allowances. The change was enacted by legislation that ties COLAs to the annual increase in the Consumer Price Index (CPI-W).
The change means that inflation no longer drains value from Social Security benefits.
The 1975-82 COLAs were effective with Social Security benefits payable for June (received by beneficiaries in July) in each of those years. After 1982, COLAs have been effective with benefits payable for December (received by beneficiaries in January).
(1) The COLA for December 1999 was originally determined as 2.4 percent based on CPIs published by the Bureau of Labor Statistics. Pursuant to Public Law 106-554, however, this COLA is effectively now 2.5 percent.