The impact of the Social Security COLA adjustment
SPRINGFIELD, Mo. (KY3) - Social Security recipients can expect an 8.7% increase in their monthly benefits. Taking into account a number of other expenses in this time of still-high inflation, how far does that go?
If a person that is 70 years old retired at 65, after making $50,000 per year annually, their benefit check would have been around $2,063.00 per month under the prior rate.
With the new 8.7% increase, they’ll likely receive a new check amount of $2,242.48, an increase of about $179.00 per month.
At present, the rate of inflation is 7.1%, which is less than the cost of living increase. However, many Social Security recipients also rely on Medicare as their primary insurance and the rates had gone up 9.2% in 2021 and may have experienced another increase in 2022. In addition, out-of-pocket healthcare spending, hospital costs and drug prices increased in 2021.
The Centers for Medicare & Medicaid Services expects health spending to keep going up in the coming years. For some retirees, that cost of living adjustment will not offset the expenses listed above.
Many economists expect a high level of inflation and continued pressures on the economy to last throughout 2023.
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