People’s cost of living adjustments (COLAs) have arrived but you may have missed it…as it’s once again pretty small. This year’s 1.5% increase amounts to an average of an extra $19/month. This is the 4th year in the last 5 of little to no increase.
Some Washington lobbyists believe that this small increase is still too generous and are advocating to change the current COLA formula to tie to the Consumer Price Index (CPI). Yet, this would result in an immediate benefit cut for millions of people. Many advocates are urging Congress to instead adopt a fairer COLA formula called the Consumer Price Index for the Elderly (CPI-E). This formula would take elders’ higher health care costs into account when calculating the annual Social Security COLA.
For more info, see the National Committee to Preserve Social Security & Medicare’s article: The CPI-E: A Better Option for Calculating Social Security COLAs.
