Experts are predicting that the Cost Of Living Adjustment or COLA will be between 9.3% and 10.1% for next year.
The Bureau of Labor Statistics points to an 8.5% inflation from July 2021 to July 2022, a slight decrease from June’s 9.1% inflation.
If the COLA increases, Social Security beneficiaries will see a boost in their benefits to help them meet their basic needs, but that’s not necessarily good news.
Why is receiving more money from Social Security bad news?
COLA is dependable on the Consumer Price Index for the working class on the third quarter.
According to The Senior Citizen League (TSCL), the latest data in June shows that COLA could be at 9.6%.
This number is still an estimate, as inflation has the power to lower it or raise it in just an instant.
TSCL’s Social Security and Medicare policies analyst, Mary Johnson said that the average benefits for retired citizens will see a boost of $158.98 each month, bringing the total to $1,656.
But this might not be enough, as Johnson told The Sun, as she thinks this amount is $58 less than what’s needed per month.
The increase in the benefits will start in December 2022 and will begin being sent out from January 2023 and on.
COLA will also affect the Supplemental Security Income
Supplemental Security Income will also be affected by the rise in the COLA.
The actual average payment is $621 per month, with the highest payment handed out being $841.
If COLA reaches the 9.6% mark, the average payment would increase around $60 dollars, while the maximum payment would also be elevated by about $80.
The negative impact of higher COLA
An increase in the amount of money received through Social Security isn’t always a good thing, as it could mean that some people could be left out of the maximum earnings required to receive other assistance programs.
TSCL posted a study that reveals how from May to July, 14% of the participants saw their assistance benefits for low-income residents reduced due to the rise in COLA.